Own your cloud journey—through a cloud transformation management office

A blog by Tim Potter, principal, Deloitte Consulting LLP; and Akhila Gudla, senior manager, Deloitte Consulting LLP.

Steering your cloud journey forward

Today, organizations are increasingly adopting cloud to support business growth and deliver new digital solutions for their employees and customers. However, maximizing the value from an investment in cloud often requires an organization to shift its operating model and transform its technology service delivery. To ensure an organization’s goals are top of mind throughout the process, it is beneficial to establish a cloud transformation management office (CTMO), a governance and management structure to guide the transformation and prepare the organization for the journey to the cloud.

Why you need a CTMO

Organizations may face multiple challenges when adopting cloud.

• As cloud becomes more widely used across the enterprise, there is a risk that the organization may lose focus and forget the original business case for the transformation.
• There is also a risk of project delays and budget overruns if the multiple interdependent activities across various lines of business, cloud, security, risk, and other business functions are not centrally governed.

A CTMO helps mitigate these risks by ensuring the commitment and ongoing support of key stakeholders and communicating value realization to executive sponsors. A CTMO also provides focused guidance and governance that ensures successful and timely completion of transformation initiatives. 

A mature CTMO identifies, prioritizes, and tracks cloud transformation goals and ensures that the value of transformation (e.g., faster speed to market, lower cost of operations, greater access to innovation) is realized by focusing on the key performance indicators identified at the outset of the project. It also oversees the allocation of budget and resources across transformation projects while holding stakeholders accountable for budget and resource management. Further, it prepares the organization to continually innovate and transform once cloud has been adopted, ensuring not just that benefits are sustained, but also that they grow over time.

How it works: Core CTMO capabilities

Key capabilities within a CTMO that enable oversight of various initiatives and their management are:

• Decision facilitation and interdependency management. A CTMO provides guidance to business stakeholders in managing priorities and addressing problem areas while migrating or modernizing applications. It also helps organizations identify and resolve issues within and across strategic priorities, and it facilitates decisions and risk remediation plans.
• Business strategy alignment and investment prioritization. A CTMO ensures that transformation initiatives are aligned with the overall enterprise technology strategy, reallocating funds from underperforming areas to higher-value projects, such as data and analytics modernization and deployment automation.
• Benefits realization and tracking. A CTMO drives expected business outcomes and quantifies the impact created and value realized (i.e., financial and nonfinancial) through a set of executive-level performance metrics like customer experience improvements, time-to-market acceleration, and product and service innovation. It can also help organizations emerge from a period of economic volatility into a position of strength while providing transparent reporting and tracking key results.
• Program governance and execution. A CTMO maintains an integrated road map with critical milestones and clearly identified dependencies.
• Culture, change management, and communications. With a focus on program-level change management, a CTMO engages employees, managers, leaders, and external stakeholders with a variety of targeted communications campaigns to drive awareness and adoption.

Getting it right: A quick-start guide to CTMO implementation

Implementation of a CTMO is unique to each organization, but there are broad steps that can be taken to make the implementation of a CTMO more effective.

• Govern effectively. Empower the CTMO to govern and remove roadblocks. For maximizing the effectiveness of the CTMO, it is important to have the the CTMO report directly to the CIO, CTO, or COO.
• Manage the changes to scope. Drive transparency on evolving requirements and changes to scope. Assess the impact on stakeholders, and serve as a clearinghouse for significant changes.
• Develop initial plans and constantly drive alignment. Bring stakeholders together through working sessions and manage changes throughout the transformation.
• Focus on value. Articulate, measure, and communicate the business value for different stakeholder communities, from initial planning through migration through modernization.
• Be agile. Connect the dots by closely examining and breaking down complexities and focusing on execution and quick wins.
• Prepare for the future. Focus on workforce enablement as a part of organizational change management.

CTMO in action

Deloitte recently chartered and ran a CTMO for a major real estate client that moved more than 95% of its applications to the cloud while modernizing its core systems. The team established early goals and objectives, defined a clear transformation road map, and drove ongoing governance and coordination across the organization. As a result, the CTMO oversaw the migration of more than 600 applications from three data centers to the cloud in less than 12 months. The organization achieved reduced IT service delivery costs, improved speed to market, and faster software release cycles, as well as increased productivity and improved technology recovery capabilities. 

Clearly, a CTMO can be a game changer for an entire organization.