How to Confidently Decide to Adopt Cloud Computing
How can I confidently decide to adopt cloud computing?
IT leaders often struggle with the decision to adopt innovations. Often adoption doesn’t get the planned return on investment (ROI) and other expected benefits. This brief examines how having an effective whether-to-adopt decision process increases your chance of success when adopting cloud computing.
Deciding confidently to move to the cloud requires proper timing and focusing on the five factors detailed below. Following a careful approach improves your chances of a successful cloud initiative.
Your firm’s market position relative to your competitor's, signals when you should start the adoption process. Use adoption rate (that is, when others decide to implement) and diffusion cycle (how adoption spreads by firm type) to drive the timing of your decision. (See IT Decision Brief “When to Adopt Cloud Computing” for more about adoption timing.) When the time is right for your firm, base your cloud solution adoption decision upon five primary factors:
- Relative advantage over existing solutions
- Compatibility with your people, processes, technologies, and providers
- Complexity of its management, use, and learning curve
- Trialability of its use
- Observability of results by primary stakeholders
Often IT leaders choose to skip or reorder these five factors, but the order is fundamental to success. Our research shows that IT leaders who focus on adopting technology innovations based on proper timing of these five factors are as much as 87 percent more successful than those who don’t.
What You Need to Know:
Adoption means deciding to accept a new technology, such as cloud computing. Successful adoption is a decision-making process spanning awareness, interest, evaluation, trial, implementation and adaption. Understanding when to start the adoption process is an important element of success. Watch firms that are the same type as yours to determine when to start considering cloud adoption.
Another element of successful adoption is making the decision to adopt by following a specific pattern of activities that enable you to examine the fundamental factors influencing adoption and diffusion. Even with proper timing, many IT projects do not succeed because of a flawed adoption process. Our research shows five factors guide the adoption decision process and predict successful adoption.
What You Need to Do:
Start when market adoption of cloud computing approaches your firm type (i.e., daring, respectful, deliberate, skeptical, or traditional). (See IT Decision Brief “When to Adopt Cloud Computing” for more about firm types and their typical technology adoption rates.) Successful technology adopters learn about an innovation, and then they consider its visible value. Only then does the decision to implement occur. To determine whether you should adopt, take the following actions, in order:
- Determine the relative advantage of the cloud solution for your firm. How much better is the cloud solution than existing or alternative solutions? Consider whether the cloud solution would be preventive or incremental. Preventive innovation lowers the probability of some unwanted future event or risk. Typically, relative advantage is a combination of economic and non-economic motivations. Most IT projects rely upon some form of return on investment (ROI) analysis to establish relative advantage, but relative advantage is not always economic, and ROI determination is often flawed or biased. Seek visible improvements to business and customers first. Then add any cost savings. Relative advantage to IT and customers must be clear and agreed to by all stakeholders. Inability to show sound relative advantage is a strong predictor that adoption would fail.
- Understand, document and confirm the compatibility of the cloud solution. How consistent is the proposed solution with existing values, experiences and needs? Be specific. Use a table or spreadsheet to document requirements. Adoption success rate increases when a cloud solution is consistent with IT needs, such as network capacity and business or customer priorities.
- Study the complexity of the cloud solution. How difficult is it to understand and use? A more complex innovation isn’t necessarily a bad thing. Such innovations often require significant training or retraining to be successful. Understanding the complexity of the innovation enables you to include the appropriate level of personnel training in the adoption process, reducing unexpected post-adoption consequences.
- Make sure the cloud solution has trialability, that is, make sure you can experiment with it on a limited basis in a real-world situation. Establish criteria to validate the cloud solution’s compatibility and complexity. Then perform a trial to verify relative advantage. Be ready for reinvention during the trial, as trials often show that you need to change your relative advantage, compatibility, and/or complexity assumptions for better or worse. The earlier in the diffusion cycle and the higher the costs and risks, the more important a trial is.
- Determine if the expected relative advantage arises from the trial and is visible to others— especially primary stakeholders. In other words, confirm observability. The more visible the benefits and outcomes from using the cloud solution, the more likely the adoption will be successful.