Brian Madden posed an interesting question on his blog. Five years from now, will a 200-person company need any servers on site?
This is an interesting debate, but I would like to look one step further. In a world where we can literally have everything in the cloud, do we really need to keep investing in our basic corporate IT infrastructure? Is IT still a competitive differentiator?
Both Google and Microsoft have fantastic offerings that allow you to divest yourself of the traditional back-end servers like e-mail, document storage, collaboration and the like. As more Software-as-a-service (SAAS) vendors come online like salesforce.com, we see the elimination of the need for CRM, ERP and other systems. PRIMUS, TELUS and BELL offer VoIP in the cloud offerings for telephony, or alternatively some organizations are eliminating desk-side phones and going purely cellular.
The question becomes what is left? As an organization that is growing internationally, we are already facing the debate over renewing our existing data centres at a local, regional or national level. This debate isn’t about money anymore, it is literally about comfort zones. By hosting our sites at a national collocation service I gain in reliability of the servers and eliminate the power, cooling and basic infrastructure maintenance from my already challenged IT budget. But the debate shouldn’t end there. Since 100% of our server are already virtualized, the natural progression will be to look at a pure cloud or hybrid private cloud. Using a service like Amazon EC2 it wouldn’t be much of a stretch to say that I could essentially eliminate the data centre mentality/need from my organization completely.
I think true debate for the SMB crowd is about “roll your own” infrastructure or true SAAS . There will always be monetary arguments both ways, but it comes down to the pace of innovation I believe.
With a roll your own, you will always be slower to deploy and innovate. Basic change management comes into play here. However you will end up with a tailored solution for your organization and that may be a competitive differentiator, or it may be an anchor around your neck.
With the SAAS, you will be on someone else’s timeline for innovation, however you will be innovating constantly as the products are updated and new features introduced. The downside for your organization is the lack of differentiators between yourself and your competition.
I have my own views on IT as a competitive differentiator. For me the commoditization of IT infrastructure has already occurred and as IT leaders we need to get used to that idea quickly. That means that basic IT infrastructure on its own does not generate revenue in most organizations today. The value we can derive from technology is focused on how quickly we can deploy it, thus allowing the rest of the organization to move forward quickly. The days of spending months integrating products should be long behind us.
So to answer my own questions above;
- No I don’t think a 200 person company will need their own servers.
- No I don’t think most SMB organizations should continue to invest in their basic IT infrastructure but should look at outsourcing/SAAS instead.
- And No, I don’t think IT is a competitive differentiator for most SMB businesses, but is more of a drain on resources and talent.