From Den’s post at ZDNet:

Horses for Sources, an analyst firm specialising in outsourcing ran a webinar on the links between what is happening in the cloud, what business wants from cloud technologies and what this means for the outsourcing community.

Much of the presentation was given over to an interpretation of the results coming out of an extensive survey that HfS ran in conjunction with the London School of Economics. The key message is that business is driving change (no news there) but that there has to be a way to overcome IT’s fear of being further marginalised as a contributor to business value…

…I had two questions:

  • What incentives are needed in order to get IT to play ball?
  • What kinds of business would naturally collaborate to bring value to cloud outsourcing?

As a follow up, Den called Phil Fersht, co-founder HfS to talk through these issues (see video above.) He says the momentum will likely come from the mid-range customers that might consider using – say – NetSuite for outsourcing financials.

It is interesting to see what we believe is an emerging trend. The mid-market could easily take advantage of the opportunities for cost reduction that have helped the top end of the market divest itself of non-core activities. There is no inherent value in keeping books and records beyond the need to comply with legal requirements. If those same cost benefits can be applied to the mid-range then it has the potential to free up resources while at the same time improving the overall quality of record keeping. It’s a tantalising thought but where will the providers come from?

The traditional outsourcers are not geared up for this type of operation. Jon and Den will discuss this in the next show.