CIOs must prepare for cloud risks

IT chiefs should be ready for unexpected costs...

CIOs must plan for unexpected costs in cloud adoption, says Gartner<

Organisations have to develop realistic contracts and cloud-sourcing strategies that are capable of reducing risk, according to analyst firm GartnerPhoto: Shutterstock

CIOs must be prepared for unexpected costs and risks because of the developing nature of cloud computing, according to analysts at Gartner.

Frank Rider, research vice president at Gartner, said in a statement that cloud service sourcing is "immature and fraught with potential hazards".

In particular, Rider argued that "cloud computing is driving discontinuity", which creates new opportunities on the one hand but also creates "costly challenges" on the other.

The flexibility of cloud sourcing, which makes cloud computing attractive to organisations, also involves CIOs accessing and paying for services in new ways.

To ensure their organisations are prepared for the move to cloud computing, Rider advises CIOs to ensure they fully understand the life cycle of cloud sourcing.

For instance, while in the past outsourcing IT services required lengthy negotiations and heavy customisation of services, cloud sourcing can be done instantly through standardised, ready-made products.

"Organisations need to understand these changes and develop realistic cloud-sourcing strategies and contracts that can reduce risk," Rider said.

Gartner argues that service providers are managing their risks based on terms and conditions that are still relatively young, and CIOs should be aware of the potential pitfalls that may lie ahead.

Experts say the recent outage of Amazon's cloud-based web service, EC2, highlights the fallibility of service agreements, with Quocirca analyst Clive Longbottom predicting that many affected clients will want to renegotiate their terms of service.