Introduction to Optimizing Cloud Team Structures for Continuous Product Improvement

Since 2020, many organizations launched digital transformation initiatives to automate their processes and adopt or migrate their technology operations to the cloud. Surveys by large analytics organizations such as McKinsey and Gartner have suggested that most have failed for a variety of reasons.

It is difficult to provide a precise number of failed initiatives as there are no publicly available statistics on the number of digital transformations that have fallen short in corporations since 2020. However, it is generally accepted that the success rate of digital transformation initiatives is not particularly high, with various surveys and reports suggesting failure rates ranging from 60% to 84%.

There are several reasons why digital transformation initiatives can fail, including a lack of clear executive strategy and leadership, inadequate investment in technology and talent (including cloud team structures and staffing mix), resistance to change from employees and customers, and a failure to align digital transformation efforts with business goals and complex customer needs.

It is worth noting that the COVID-19 pandemic has both accelerated the need for digital transformation in many organizations and created new challenges for digital transformation initiatives. Many organizations have had to adapt quickly to new ways of working and engaging with customers, which has put additional pressure on digital transformation initiatives. This has led to an underestimating of complexity of cloud team structures which are needed for a continuous product improvement process that leads to high Quality of Service (QoS) for customers.

In any case, it is clear that digital transformation is a complex and challenging process that requires careful planning, execution, and ongoing adaptation to changing circumstances. While some digital transformation initiatives may fail, it is important for organizations to learn from these experiences and continue to pursue digital transformation in order to remain competitive in today’s fast-paced, digital-first business environment.

The implication is that optimizing the structure and staffing of an IT cloud team can be a challenging, often complex process. There are a few key considerations that executive leadership and upper management can take into account to make the most of their staffing resources:

· Define clear cloud teams, roles and responsibilities

· Determine the necessary skill sets

· Consider the size and complexity of the cloud environment

· Balance in-house and outsourced resources

· Foster a culture of continuous learning, research and development

Define clear cloud teams, roles and responsibilities

The establishment of precise roles and responsibilities within a cloud team is an integral component of accomplishing organizational objectives. This facilitates the comprehension of individual responsibilities, enabling team members to better grasp the impact of their contributions towards the overarching organizational vision. In other words, they see the direct value of their sprint team contributions to solving customer problems. This methodology also serves to remove redundancies and channel the team’s efforts towards areas of high importance. Further, it is imperative to ensure sufficient staffing levels in each role to guarantee optimal customer service delivery.

The monitoring team, for instance, can be staffed adequately to proactively identify and troubleshoot customer problems before the customer discovers them. In the case of large organizations, the establishment of a personnel-to-client, product, or project ratio is a judicious decision to ensure the effective allocation of resources. Aligning team member counts to project ratios helps to provide good coverage to the number of clients and customers your organization has. This is especially important for B2B client scenarios, where having one or two developers may not be enough for 20 large B2B clients, each with millions of users.

Determine the necessary skill sets

For any given cloud or digital transformation project, there are certain skills need that must align with user requirements with emphasis on scaling the number of skilled workers with the size of the customer (B2B) or customer base (B2C). It is essential to identify the highly specialized skill sets required to support cloud infrastructure, including proficiencies in:

· distinct cloud platforms (SaaS, PaaS, IaaS)

· programming languages, and

· security protocols

This strategy aids in directing recruitment and training endeavors and guarantees that the team possesses the appropriate blend of expertise.

Consider the size and complexity of the cloud environment

The magnitude and intricacy of the cloud environment can significantly affect the personnel requirements of the team. A diminutive and less intricate environment may demand a modest team, while a vast and multifaceted environment may necessitate multiple and more specialized teams.

Let’s unpack this a bit. Assume that a company is using a public cloud service provider (CSP) for their operations. They have established a dedicated cloud monitoring team to oversee and manage their cloud infrastructure. In this scenario, the size and complexity of the company’s cloud environment would be the primary determinants of the necessary staffing levels for the monitoring team. Some organizations ignore this critical factor to their detriment, which is often where cloud migrations and digital transformations fail.

For a smaller cloud environment with limited cloud resources and services, the monitoring team may comprise a few personnel with a general understanding of cloud infrastructure and basic monitoring tools. The small mom and pop IT shops won’t be dealing with several major B2B clients or millions of users in their customer base. On the other hand, a larger and more complex cloud environment, with multiple cloud services and resources, may require a more extensive monitoring team with highly specialized roles, such as cloud security specialists, network monitoring experts, cloud architecture professionals, and data analysts.

In this way, the staffing requirements of the cloud monitoring team would depend on the size and complexity of the cloud environment, and the necessary skill sets for the team members would be based on the specific cloud services and resources being utilized.

Balance in-house and outsourced resources

It is crucial to identify the most advantageous equilibrium between in-house/onshore and outsourced/offshore resources. This could involve utilizing third-party vendors for particular functions, such as cloud security, while maintaining essential development and maintenance tasks in-house. For instance, cloud monitoring and alerting might require 24/7 operation with coverage in various regional time zones, necessitating multiregional team coverage.

Determining the optimal balance between in-house/onshore and outsourced/offshore resources can have several cost advantages and disadvantages for an organization. One of the primary cost advantages of outsourcing is the potential for reduced labor costs. Outsourcing to offshore locations may allow companies to benefit from lower labor costs in countries with lower wage rates, thus reducing overall operational expenses. Additionally, outsourcing specific functions, such as cloud security or data entry, may be more cost-effective than hiring in-house staff with the same expertise.

On the other hand, outsourcing may have a few drawbacks. For instance, communication issues may arise due to language/cultural barriers or time zone differences, which may impact project timelines and increase costs. Time zone difference can be a big factor in managing quality of service (QoS) for customer service level agreements. Monitoring and alerting, for instance, can be rendered useless if a major B2B client in the Central Time zone has to wait for Level 1 or Level 2 support in an Asian time zone. There may also be additional costs associated with managing the outsourced team, such as oversight and coordination expenses. Additionally, outsourcing may reduce the level of control and oversight that an organization has over its operations and data, potentially leading to security risks.

Maintaining in-house staff can be advantageous in terms of control and flexibility. An in-house team is typically easier to manage and can respond more quickly to changing business needs. Additionally, it can be easier to ensure the quality of work when it is done in-house. However, in-house staffing may also be more expensive than outsourcing, as it requires investing in hiring, training, and retaining staff with specialized skills and knowledge.

Ultimately, the most cost-effective approach will depend on various factors, including the size and complexity of the organization’s operations, the expertise required for specific functions, and the cost of labor in different regions. Therefore, it is essential to carefully weigh the advantages and disadvantages of each approach and determine the most effective strategy for the organization.

Foster a culture of continuous learning, research and development

Cloud technology is constantly evolving, so it’s important for the team to stay up-to-date with the latest developments and trends. Management can foster a culture of continuous learning by providing access to training and development opportunities and encouraging team members to stay current with industry developments. Having an R&D team, in association with a corporate training team, can ensure that the organization is discovering new technologies that can improve team productivity. The training team can continuously plan and coordinate training for new technologies.

Conclusion

In conclusion, there are certain strategies management can plan and implement to optimize the structure and staffing of their IT cloud team, ensuring that it is well-positioned to support the organization’s strategic objectives. The process of digital transformation is a challenging and intricate journey that necessitates meticulous planning, implementation, and continuous adaptation to dynamic conditions.

While a number of organizations may experience setbacks during their digital transformation (DT) initiatives, it is crucial to derive lessons from these experiences and pursue DT to remain competitive in the rapidly evolving, digital first business world. Industrial era management strategies are obsolete. Optimizing the structure and staffing of an IT cloud team while transitioning from the industrial mindset can also be a complex process.

As such, there are key considerations that executive leadership and upper management can take into account to maximize their technical staffing resources. By adopting a strategic and comprehensive approach to staffing, organizations can leverage the benefits of cloud technologies and improve their business outcomes.