Cloud Computing and IT Sourcing for the Enterprise

by Brian J. Dooley

Cloud computing is likely to have a continual and lasting impact on sourcing. While still in its infancy, it is bringing about a "weather change" in how outsourcing is viewed as well as in client expectations. In cloud computing, services are provided on a granular, pay- as-you-go basis through a versatile infrastructure that makes possible innumerable service variations. Cloud services available today include variants on software as a service (SaaS) and infrastructure as a service (IaaS). These offerings are designed to provide simplified access to computing resources that can be added to corporate IT environments. Although it is far too early to assess the full impact, the potential for competition with business process outsourcing can already be seen. Customers that make use of such cloud-based SaaS offerings as Salesforce.com do not need to engage with an overseas supplier to provide the application, for example. Similarly, companies that elect to use IaaS or platform as a service (PaaS) from the cloud may have less need to outsource facilities management or their complete IT operations in the future.