Enterprise Information Strategy in 2009

If you’ve been in an IT-related role for more than 10 years, you’ve likely enjoyed the boom and bust the economy has provided. Healthier times enhance business capabilities in the form of multi-million dollar, cross organization implementations, while leaner times like these afford only the most critical needs to be fulfilled. So while the volatility wreaks havoc on your organization, one IT spend continues to stay strong. Strategy.

Strategy is a sound investment in prosperous times since the confirmation it provides protects the investment of larger scale initiatives. For example, a company committed to providing better customer service and market additional products into its customer base will undertake a 2 to 3 year set of tactical CRM initiatives. Success factors include the three usual suspects, ‘People, Process and Technology’, and aligning each with an ideal future state vision is critical.

A well executed strategy provides an education for stakeholders and builds consensus among individuals who may have never sat around the same conference room table before. It coalesces and prioritizes goals and objectives, drafts a future state architectural blueprint and describes business processes that will endure, and establishes a long term Road Map that orchestrates incremental efforts and illustrates progress.

So if strategy is a safe bet in better times, why invest in one now?  For executives I’ve met with most recently (Q3 and Q4 2008), a popular form of strategy is analogous to grandma’s attic. At some point, it may have occurred to you to look in grandma’s attic for something that may be useful, and if you’re truly fortunate, there may be something extremely valuable you hadn’t counted on. For C-level executives looking for ways to improve their bottom lines, the same treasure hunt exists in the corporate information they already possess.

To understand whether your enterprise information holds hidden treasures, explore these 10 questions with your organization. Answering ‘No’ or ‘Not sure’ to any questions that have exceptional relevance within your organization may suggest looking into an Enterprise Information Strategy enagement.

1. Do visionaries within my company have visibility to key performance indicators that drive revenue or lower costs?
2. Do I understand who my customers are and which products they own?
3. Am I able to confidently market additional products into my existing customer base?
4. Do I possess data today that would provide value to complimentary industries through new information based offerings?
5. Will my information platforms readily scale and integrate to meet the demands of company growth through acquisition?
6. Am I leveraging the most cost effective RDBMS software and warehouse appliance technologies?
7. Do I understand the systemic data quality issues that exist in the information I disseminate?
8. Do the organizations I support understand the reporting limitations of my current state architecture?
9. Is there an architectural blueprint that illustrates an ideal 2 to 3 year business intelligence future state?
10. Does my company have visibility to a Road Map that timelines planned projects and the incremental delivery of new business insights?

Reshaping your PMO to Beat the Recession

There’s been some buzz lately on how PMOs can help your company spend wisely during a recession. In wading through the recent buzz, it’s important to know that not all PMOs are created equal, and the skills of the PMO leadership can make or break your ability to use a PMO as a weapon in your recession-beating strategy. Because the economic climate has changed drastically, you may be in danger of overspending if you don’t re-evaluate and re-engineer your PMO to meet the needs of the day.

Kristen Caretta, at Search CIO-Midmarket discusses how project management offices are uniquely positioned to cut projects that have spiraled out of control and identify those critical to meeting changing business needs and increasing business efficiency.

An article at CIO.com includes key metrics for gauging PMO success. It’s important to reconsider your metrics during the recession, however, because the shift in business climate may require you to track against different targets.

Look critically at your PMO and the way it operates to see if your organization is guilty of any of these behaviors. All of them can actually cause a drag on your bottom line.

• Undue effort spent on policing project teams for adherence to a standard methodology. A highly functioning PMO evaluates requests for exceptions to methodology standards and helps the teams run with a lean and mean approach that speeds up progress while imposing an identifiable and acceptable level of risk to the business.

• Hyperfocus on metrics. Don’t let the endless tracking of metrics become an end unto itself. The only thing that needs to be reported and addressed are the exceptions-those projects that are riding off the rails. It’s a waste of corporate resources to publish lengthy status updates on projects that are humming along without any problems.

• The half-day weekly PMO meeting with a cast of thousands. Be very clear on the purpose of your regular PMO meetings. Using them to resolve cross-cutting issues and refine project strategy or reprioritize the project portfolio and realign resources is a good use of time. Dragging every project manager through status updates for each project only makes sense if the projects are somehow inter-related.

• The IT PMO-in-a-silo. The biggest bang for your PMO dollar is in its ability to foster alignment between business needs (which may in fact change over the lifespan of a project) and implementation projects. You can only do this if your PMO is an enterprise (as opposed to an IT) entity. The director of your PMO needs to have a solid record of experience in advising and negotiating at the C-level, in addition to rock-solid project and program management skills.

To navigate the recession, don’t assume that your current PMO is already providing exactly what you need to win in a difficult economy. If you don’t have a formal continuous improvement approach in place, a semi-annual review and realignment of PMO approach and operations may be in order.

Generating Revenue through Social Networks: Part I

submitted by Ken Allard

Many organizations are struggling to understand why they should care about online social networks. They narrowly define them as blogs and message boards and dismiss both their relevance and their potential to generate new revenue. I believe that by failing to directly develop initiatives related to community many companies are missing opportunities to take advantage of the inherent network benefits that online services can offer.

Here are five qualifying questions that companies should ask themselves to see if they have an opportunity to generate revenue by fostering the growth of an online social network:

1. Do you act as a broker of goods or services?

2. Do you provide content or advice to a significant percentage of a specific industry or consumer segment?

3. Are you facing new competitors who generate revenue by aggregating audience around your content or by providing meta-content?

4. Do you have data or knowledge within your organization that is obscure to your clients?

5. Do you serve an audience that is highly fragmented?

Any company that answers yes to any of these questions may have an opportunity grow their revenue. In this blog series, I will explore each of these questions and provide case study examples of organizations that have the potential to launch profitable social networking initiatives or those that already have them in place.

Let’s start with the first two questions:

1. Do you act as a broker of goods or services?

2. Do you provide content or advice to a significant percentage of a specific industry or consumer segment?

Companies that can answer yes to either or both of these questions have perhaps the richest opportunity to profit from social networking. Fortunately, a wide variety of organizations fit into this category. Let’s look at four different examples:

Wine Spectator – Wine spectator has an offline paid subscriber magazine that includes access to a Website. The magazine’s content includes stories about wine trends, wine auctions, experiences, travel, food, and other lifestyle content. Perhaps the most valuable content that the magazine provides is its expert ratings and tasting notes about wine. Wine Spectator’s wine experts are so respected and revered that their ratings immediately affect the price and the availability of wine.

While the offline magazine is interesting and a useful wine guide, the Web site has transformed the value of the publication. First it is a database of all the tasting notes and ratings for every wine that the magazine has evaluated. Hence, anyone looking for a review of a specific wine before making a purchase, has immediate access to an expert rating that provides valuable information and pricing guidance. If you haven’t yet figured this out, I am a huge wine enthusiast). The Web site takes this benefit a huge step forward, however, by enhancing the recommendations of their experts with the opinions of the entire Wine Spectator community. The Web site also allows each member to build an online inventory of their own wine collection with their own tasting notes and ratings which they can share with all other members.

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Thus, the publication has greatly expanded the content available to all members and has significantly increased the utility of the Web site. Members share their own entertaining stories about their wine experiences with each bottle, what food they served with it, and their own perspectives about the quality of the wine. This social feature increases the revenue of the site by increasing page impressions (i.e. advertising revenue), engagement, and subscription stickiness. While I do not have access to any proprietary information, I am certain that the renewal rate for members who have entered their entire wine collection online is significantly higher than that of those who are passive readers.

Consumer Reports – Consumer Reports is an enormously respected magazine and Web site, published by the non-profit organization Consumers Union. This organization has been helping consumers make smarter purchases for decades and provides a valuable public protection and public advocacy service. Consumer Reports ratings and rankings of products are distinguished from any other source in that they are independent, objective, and scientific. The organization tests each product with sound, consistent methodologies. (The facilities are amazing. If you are ever in Yonkers, contact the organization to see if you can get a tour of the testing facilities. It is a fascinating experience).

The organization is serious about its mission and the scientific nature of its ratings. Thus, it has chosen to limit and often exclude the product opinions of its readers. Subscribers to the Web site may go to separate forums to discuss product quality, but unlike Wine Spectator or other sites like Amazon.com, member opinions and reviews are not integrated into specific product ratings.

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I believe that the organization is missing an opportunity to increase engagement, page views, and subscription renewals, by limiting the ability of consumers to learn from each other and to participate in the process of evaluating products. On the Web, people want to participate. They want sites to offer utility, convenience, and an integrated experience. Sometimes brands and policies need to evolve to remain relevant.

Reed Construction – Reed Construction is a business to business service that offers content to the entire construction industry, including contractors, architects, and product companies. Contractors and other suppliers seeking work or new sales can gain access to a database of new projects, building plans, and building specifications. This is a high value, premium content service, with paid subscriptions being the primary source of revenue. Reed, however, is failing to address a large part of the potential subscriber market.

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Reed is a kind of non-traditional broker of goods and services. While not directly enabling a transaction between two parties, their information is directly facilitating a transaction. Currently, Reed only provides content to one half of the purchasing dynamic, the suppliers. With the power of a proprietary social network, Reed could also provide information and advice to the businesses and developers who are seeking products and services. By developing some simple Web applications, data capture standards, and analytical frameworks, Reed could rate, rank, and categorize all suppliers of goods and services, relying largely on outcomes data gathered from the developers. Like Amazon and E-bay do with their networks of consumers and independent sellers, Reed has the opportunity to use the social network of professional developers who may be geographically dispersed but who share a common set of experiences with products and service providers to gather outcomes and ratings data that can be valuable in making future purchasing decisions. By failing to monetize their true network, Reed is leaving at least half of the potential market unserved.

Hamptons Real Estate Online – Hamptons Real Estate Online is the leading source of listings information for anyone looking to buy or rent a house on the east end of Long Island. It is not all that different from any other real estate site except that it is not specific to any specific broker and it offers and extremely easy to use interface and set of search and browse utilities. It is also a little different in that it serves a very specific regional community and its database of rentals and properties for sale is quite comprehensive. In effect, it is the one place to go to for this information. The site makes money by collecting listing fees. It is essentially a new form of a newspaper classifieds.

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Hamptons Real Estate Online is missing a revenue opportunity by failing to fully recognize that it is serving a distinct community. The collection of towns and villages that comprise the Hamptons is essentially a large, linked resort community. People buy and sell houses repeatedly. They often rent a different property every year. Real Estate is a hobby of sorts and the mass of people that returns to the Hamptons each year needs services that are specific to their property rentals or purchases. Yet, the Web site (unlike others that cater to a people seeking information about rentals, e.g. www.vacationrentals.com) does not capture any feedback from previous renters about the quality of the property. It also does not present any advertising or classified information about the services that renters or new home buyers often need such as cleaning, landscaping, pool service, or contractors. Essentially, the site is failing to monetize its community. The site could also greatly add utility to its site by presenting additional information about the homes that are listed (e.g. previous sale price and ownership history all of which is publicly available but fragmented) and allowing users to register and maintain information.

Three Basic Social Networking Strategies

There are three basic approaches that these companies have pursued or should pursue to generate new revenue.

1. Add value to existing content by gaining audience feedback or additional user-generated content. (e.g. Wine Spectator)
2. Capture data about how your community interacts with its suppliers or service providers and about the transaction itself to inform or advise future product development, marketing, or purchasing decisions. (Hamptons Real Estate Online, Reed Construction )
3. Add content to your offering to extend your services beyond your core service. (Consumer Reports)

In the next post in this series I will address opportunities related to question number three:

3.  Are you facing new competitors who generate revenue by aggregating audience around your content or by providing meta-content?

What’s your project collaboration style?

A lot of today’s news has covered inaugural fashion style, but let’s get back to business and talk about collaboration style. We’ve seen a lot of different approaches to project team collaboration, and are wondering how our readers’ project teams work together on shared project files. Please take a moment to answer this poll, and feel free to comment on your answer in the combox.

Now is the Time for Comfort IT

Whenever crisis strikes and people enter uncertain and frightening times they close up like a clam.  They do not take on new risks like new cars or houses, instead they find comfort in life’s little pleasures.  Macaroni-and-cheese, tomato soup, and meatloaf seem to sooth the troubled mind and are the perfect accompaniment to the theater of financial meltdown.  IT has it’s equivalent of comfort foods, short (less than one budget cycle)  projects with easily measurable gains.  Projects which enhance core business functionality and projects which increase visibility are usually easy wins.

Projects like “Let’s Outsource All IT”, “Let’s Go to the Cloud”, or “Let’s Move to Open Source, Oracle, Microsoft, etc. to Save Money” are not Comfort IT and elicit the image of someone running down the hallway with their hair on fire screaming (does not look comfortable to me, let’s skip this one).  These projects will have their time in the sun when the Great Wheel turns again and risk is the entree of the day.  It will be fun to see how fast the major vendors morph their tune to a new reality; they are already shifting from guppy sales representives to bonafide sharks via the layoff lever (I am ever thankful for Email, Voicemail, and Spam Filter Purgatories).

If your organization is light on legacy projects and issues, now is the time to start some (ha ha ha!).  All joking aside, this period is a breather in the steady march of technological leverage of the corporation.  Companies can leapfrog past the painful pioneering process inherent in most technical innovation, at a bargin price.  Just about every hardware, software, and services vendor will have capacity to sell.  It is a buyer’s market , which gives the most comfort of all. 

This is the perfect time to review projects.  Determine cost-to-complete, or can it be completed.  Will it enhance the business process and ultimately be welcomed by its users, or is it a statue to political personal vanity (or an ediface to technology).  Sacrificing projects on the altar of the crisis is considered a statesman-like action and a career-saver for both the guilty and innocent.  For the fearful, consultant priests are available to both identify and cleanse  corporate IT sins for a small fee in these times (put another project on the fire!).  Nothing like a second opinion to sooth the soul, a true IT comfort food.

The Surprising Link Between Web Usability, Customer Satisfaction and ROI

A just released survey of the top 40 e-commerce sites asked users to rate their satisfaction with the buying experience. In the results, the survey director notes “higher customer satisfaction ratings often translate into loyalty and purchase intent”.

It is amazing that we still need surveys to tell us that. Web usability started as an art and is now an established science that uses audience personas, usage stories and needs mapping to optimize site flow, calls to action and creating an engaging yet efficient experience tailored to each visitor.

Jacob Nielsen in recent studies found an improvement of 83% to 138% in KPI’s resulting from a web usability redesign. In about 12% of the cases, the increase was tenfold.

With every web initiative need to provide Return On Investment (ROI) justification, most sites and applications have huge potential for improvement and can easily justify usability upgrades.

How to build a strong ROI case

The common formula for the commerce site business potential is based on the simple concept of getting as many visitors as possible and converting them into paying customers.

Business = Visits x Conversion Rate X Average purchase amount (For each revenue stream on the site)

Let’s look at each of these 3 components that largely determine site performance: volume, conversion and purchase size and see where the usability comes in.

Volume: traffic is comprised of new traffic and repeat traffic (V = Vnew + Vrepeat). Attracting new visitors to the site can be expensive and the acquisition cost is often reduced from the total revenue generated. Repeat and loyal visitors are essential to profitability and any improvement in the repeat visitor rate has significant impact on the bottom line. Good user experience that contributes to customer satisfaction will increase the number of repeat visits and add traffic without the acquisition cost.

Conversion Rate: The other critical role of usability is to make sure each visitor is provided with their specific needs which are not always a direct purchase. In a previous post I looked at the new e-commerce paradigm that acknowledges the multiphase shopping experience and provides information, interaction and solutions for visitor in every phase of their purchasing decisions. User experience optimization can have a dramatic effect on converting a visitor to a customer.

Purchase Size: Amazon started product merchandizing, upsells and recommendations more than a decade ago but many companies still are not perfect at providing users with additional options and suggestions throughout the checkout process.

Therefore the impact of usability on the Business consists of the increase in repeat traffic (∆Vrepeat), the increase in conversion rate ∆CR and the increase in purchase size ∆PA or in a formula: B = (Vnew + (Vr + ∆Vr)) x (CR + ∆CR) x (PA + ∆PA)

Usability contributions to cost reduction and savings:

• Reduction in marketing spend for new customer acquisition. The same traffic goals can be achieved with more repeat traffic reducing marketing expenses for new traffic generation.
• Reduction in calls to phone support

Other factors to consider:

• The cost of doing nothing. Not improving usability can actually hurt the factors listed above as the market is not static. The overall web usability standards have increased with rich interfaces and Ajax style functionality. Sites that have not caught up, look dated and clumsy. The competition is not static either. If your site’s experience is inferior to the competition, traffic will move there.
• Social media and word of mouth quickly spread good experiences and bad one to an extremely wide audience.

And lastly, without good web analytics program and measurements, you may not know to identify the challenges of poor usability or the contributions of improvements so consider setting an analytics baseline prior to any substantial improvements.

Top 10 Reasons for System Implementation Failure

Insurance carriers are not typically custom development or system integration experts – their business is insurance, not software.  There are some national carriers that have built their company around providing insurance directly over the web and have created proven methods of software development and integration.  That is not the case for most, especially small- or mid-size carriers.  These carriers see the need to improve  products, speed to market, and flexibility. They address the underlying system needs by buying, building, or a combination, and introducing new systems into their technology ecosystem.  Unfortunately, too many times these projects fail.

There are many different reasons why  system implementations to fail, but this is the top 10 in my experience.

1)       No experience running an RFP to begin their selection. The RFP was pulled from the internet, modified slightly and sent out.  Out of 4 responses, three eventually dropped out, so they went with the one remaining, never taking a close look at what they were buying.

2)       Inadequate Project / Program Management Process. The project was driven by hard completion dates without having a valid work breakdown structure for a project plan to really understand what it would take.  One high level executive ran the project, and no one was empowered to reveal that the emperor had no clothes.

3)       The software development company was located in Europe and the stateside representation was a consulting company that did not understand the carrier’s business.

4)       The carrier failed to properly check the vendor’s references of successful installations, of which they would discover there were none.

5)       The carrier wanted to perform too much of the work themselves, learning as they go, and not allowing the experts to do what they do best.

6)       Tried a big bang (All lines, all states, and all systems on day one).

7)       Scope management. Tried to put everything in the first release afraid that if it was not there, they would never get it.  As a result, they got nothing.

8)       The carrier’s requirements were actually pretty good, but they did not know how to manage them. They could not set and hold on to their agenda, rather than letting the vendor set the agenda.

9)      Not enough involvement in the process by the business.  After the selection all the work was done in a “black box” and what was delivered was not what the business wanted.

10)   Poor or no Quality Assurance process.

Taking the Plunge into SaaS

Under pressure to reduce IT budgets, many businesses will make their first attempts at implementing Software as a Service (SaaS) in 2009. While there are real savings to be gained by phasing SaaS into the enterprise architecture, careful planning can help steer around some of the common difficulties.

1. Start with a realistic assessment of your application portfolio to determine where your best SaaS conversion options lie. Customizations are a complicating factor when moving to the SaaS model. It can be done, but manage expectations within the business aggressively to let them know that the SaaS solution will be implemented as close to out-of-the-box as possible.  Your first attempts at moving to SaaS might be best steered towards the applications with fewer points of integration, as these will complicate the implementation (see point #3, below).

2. When doing your initial scan for SaaS solutions, make sure you have second sources lined up for each application, and thoroughly vet out the differences in their offerings from the application functionality, service offering, and cost perspectives.

3. Model your integration points rigorously. Identify all possible interface failure points and document exactly who is responsible for identifying and fixing these failures. Include the failure scenarios in your SaaS migration test plan.

4. Service level agreements are key to making the relationship work. Even some of the oldest SaaS offerings, such as Salesforce.com, have outages from time to time that leave users high and dry. Every service component needs several service level agreements explicitly defined in the contract. These include:

• Application uptime as well as maximum length of downtime per outage episode
• Time to resolve trouble tickets by email and by phone
• Required advance notification for scheduled maintenance outages

5. Pre-sale due diligence is not enough. The Satyam scandal has taught us that. Use every means available to stay ahead of news on all your SaaS partners, including monitoring twitter, technorati, Google alerts, and traditional media for hints that they might be experiencing customer satisfaction or business issues that could impact the quality and longevity of their service.

Are you really listening to your customers?

If the pressure to obtain and implement Customer Relationship Management software is any indication, companies are recognizing the increasing importance of customer knowledge. Indeed, customer insights can lead companies to their best opportunities for growth far more accurately than that marketing presentation in the boardroom. The increasingly-reluctant-spending-customer needs to be better understood because company growth depends on it. The challenge is that customer interactions are not typically structured information that is easily analyzed to be acted upon, but are increasingly emails, phone conversations, web-based chat support and other unstructured information.

Outbound direct mail or telemarketing is simply not getting results for marketing departments. The focus needs to shift to creating a great customer experience on the inbound approach as an alternative. Doesn’t everyone enjoy doing business with a company that makes it easy to find and obtain what you are looking for? You don’t have to look far for proof of this idea. No longer able to differentiate on brand reputation, leading companies instead are focusing on customer experience—the all important feelings that customers develop about a company and its products or services across all touch points—as the key opportunity to break from their competition. Evidence of this new emphasis is found in the emergence of the “Chief Customer Officer (CCO)” role across the Fortune 1000 community. Companies such as United Airlines, Samsung and Chrysler have all recently announced chief customer officers as part of their executive suites.

The first challenge faced by these newly minted executives is customer experience management (CEM)—the practice of actively listening to customers, analyzing what they are saying to make better business decisions and measuring the impact of those decisions to drive organizational performance and loyalty. Enter a new technology to address all of the unstructured information that comes from customer interactions – text analytics. Text analytics is specialized software that annotates and restructures text into a form suitable for data mining. Text mining comes from data mining, a statistically rooted approach to classification, clustering, and derivation of association rules. Fortunately, there is much to be learned about how to handle unstructured data from two decades of struggling with similar problems in the structured data world. We now know as needs change and evolve, organizations will require the flexibility to integrate the most appropriate text processing technologies to extract desired information. They must enable users to apply time-tested analytical approaches that can be modified or expanded upon as understanding of issues and opportunities emerges from the data itself. For example, a call center should be able to apply a multi-dimensional analysis (i.e., “slice and dice”) to call center logs and email text for assessing trends, root causes, and relationships between issues, people, time to resolution, etc. Organizations should have the infrastructure, storage, and user interfaces to process and efficiently explore large volumes of data. And they need to easily leverage their existing BI and data warehousing (DW) tools presently used only for structured data analyses, to analyze unstructured data alongside structured data.

When text analytics are implemented against unstructured customer information, Customer Experience Management will drive significant, quantifiable benefits for the enterprise. In the most effective approaches to CEM, companies use text analytics to collect and analyze intelligence from all of the varied sources of feedback available inside and beyond the enterprise. They grow more intimate with their customers and more agilely adopt informed improvements. The focus is a real-time feedback loop that will result in a continual, systematic capability for measuring and improving customer experience.

The real magic always lives in the intersection of key technologies. Using text analytics for identifying the opportunities and trends from your customers then requires action – cross-selling or up-selling, generally implemented using automated workflows during the customer interaction. The faster and smoother the customer transaction occurs will help ensure “positive” feelings for the customer experience. A carefully architected solution implementation will drive this all important synergy for outstanding competitive results – and happy customers seeking out your company. The new mantra for marketing: Listen to your customers and make them happy.

Cloud Computing: Where is the Killer App?

As an avid reader, I have read too many articles lately about how the bleak economy was going to drive more IT teams to use cloud computing. The real question: what are the proper applications for Cloud Computing? For the more conservative IT leader, there must be a starting point that isn’t throwing one of your mission-critical applications into the cloud.

One of the best applications of cloud computing that I have seen implemented recently is content management software. One of the challenges with content management is that it is difficult to predict the ultimate storage needs. If the implementation is very successful, the storage needs start small and immediately zoom into hundreds of gigabytes as users learn to store spreadsheets, drawings, video and other key corporate documents. Open source content management software can be deployed quickly on cloud computing servers and the cost of storage will ramp up in line with the actual usage. Instead of guessing what the processor needs and storage will be, the IT leader can simply start the implementation and the cloud computing environment will scale as needed. My suggestion is to combine wiki, content management and Web 2.0 project management tools running in the cloud computing space for your next major software implementation project or large corporate project.

A second “killer” application for cloud computing is software development and testing. One of the headaches and major costs for software development is the infamous need for multiple environments for developing and testing. This need is compounded when your development team is using Agile development methodologies and the testing department is dealing with daily builds. The cloud computing environment provides a low-cost means of quickly “spinning up” a development environment and multiple test environments. This use of the cloud  is especially beneficial for web-based development, and testing load balancing for high traffic web sites. The ability to “move up” on processor speeds, number of processors, memory and storage helps establish real baselines for when the software project moves to actual production versus the traditional SWAG approach. The best part is that once the development is complete, the cloud computing environment can be scaled back to maintenance mode and there isn’t unused hardware waiting for re-deployment.

The third “killer” application is data migration. Typically, an IT leader will need large processing and storage needs for a short term, to rapidly migrate data from an older application to a new one. Before the cloud, companies would rent hardware, use it briefly and ship it back to vendor. The issue was guessing the necessary CPU power and storage needs to meet the time constraints for the dreaded cut-over date. The scalability of the cloud computing environment reduces the hardware cost for data migrations and allows flexibility for quickly adding processors on that all important weekend. There is simply no hardware to dispose of when the migration is complete. Now that is a “killer” application in my humble opinion. By the way, cloud computing would be an excellent choice for re-platforming an application, too, especially if the goal is to make the application scaleable.

In summary, if your IT team has a short term hardware need, then carefully consider cloud computing as a cost effective alternative. In the process, you might discover your “killer app” for cloud computing.