Storms gather over cloud computing

22 October 2013
Cloud computing seems to be everywhere these days, but a meeting of high level procurement professionals seemed to conclude a healthy dose of cynicism was required to address it.

The roundtable discussion, organised by Investigo Procurement and Proxima, was told cloud computing was being used by suppliers to tempt buyers with something “new and shiny”.

The meeting was told some companies had signed up to technology outsourcing deals and then been “fleeced” by suppliers. An executive said: “I don’t think the contract models on cloud are that innovative. I think they are thinking of how they can come up with terms that will fleece us.” The cloud was referred to as a “red herring”, while someone said buyers should not be distracted by it. “I‘ve already had to unpick a cloud deal because it was a black cloud,” an executive said. The discussion, which included attendees from Carphone Warehouse, Barclays and the Post Office, heard procurement still had an important role to play in technical innovation. One executive said: “As a procurement person, you always have to be curious about new developments.” Another said it was important to answer three questions before signing any IT contract. “What do we want and how much do we want, what is the value to the organisation, and what happens if we don’t want it anymore?” he said. A challenge remained around how the work of procurement is measured in innovation, when the traditional emphasis on cost saving was no longer appropriate. “How do you measure the success of your activity if those cost savings don’t apply?” one executive asked.
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