Cloud Smart: Strategic Considerations for Information Leaders in the AI Era

As information professionals navigate the rapidly evolving technological landscape, the democratization of technology — particularly cloud services — presents both opportunities and significant challenges. With AI accelerating this trend, it's more important than ever to approach technology decisions with a strategic mindset.

Beyond "Cloud First" to "Cloud Smart"

While cloud services offer tremendous benefits, especially for smaller organizations without extensive IT resources, the approach shouldn't be "cloud first" but rather "cloud smart." This means:

• Understanding what data, you are moving to the cloud and why
• Recognizing that the data is no longer under your direct control
• Evaluating the specific risks and benefits to your organization

The Hidden Risks of Democratized Technology

Software-as-a-Service (SaaS) is an example of the democratization technology offering. The benefit is easy accessibility to technology solutions, because with a credit card you can subscribe to a SaaS solution. However, easy accessibility can often lead to overlooking critical considerations, such as:

• Data extraction challenges: How will you get your data back if you want to change providers?
• Vendor viability concerns: What happens if your provider goes bankrupt or gets acquired?
• Data jurisdiction issues: Do you know where your data is being physically stored?
• Business continuity risks: What to do if access is disrupted due to technical problems or civil strife in another region?

These concerns become particularly acute when dealing with mission-critical data, where relying on cloud providers introduces unknown risks outside your direct control. This is called third-party risk management — which is entirely a different discussion and outside the scope of this blog.

The Shadow IT Challenge in the AI Era

One of the more interesting developments I've observed with respect to SaaS is the increase of "shadow IT" systems — technology solutions used without formal IT department involvement to complete a risk and impact analysis on business operations, business continuity, data usage, privacy, etc. If you do not ask fundamental questions before and during the initial adoption of a SaaS solution — questions about data access, storage locations, backup and disaster recovery, security, etc. — your organizations may find themselves unable to effectively leverage this data for AI applications. These risks are further amplified for AI solutions, because they are designed to process large quantity of data. Unfortunately, most organizations do not have a good understanding of the risks and the business value of their data stored in various repositories.

Information professionals are now trying to understand the "dark data" from shadow IT systems, plus other IT systems, and incorporate the dark data into their AI knowledge base. This creates a compelling business case for your organization to tackle its “shadow IT” landscape and operational risks that may have previously been overlooked.

Balancing Benefits and Risks by being “Cloud Smart”

I believe cloud services are tremendously useful for a lot of organizations. If you're a small operation, it makes sense because you don't have the time or money to have staff with the skills to look after complex IT infrastructure. Whereas, cloud-service providers do have people that are experts and they'll have the tools to keep your data safe. The key is understanding and asking strategic questions, such as:

• How to accurately measure the ROI if moving to a cloud-based AI solution?
• Which data truly needs to be hosted in the cloud?
• What security measures are appropriate for different data that will be hosted in the cloud
• How to maintain appropriate governance and control of my data?

Concluding Thoughts: To Be Smart, Be Curious

I continue to see that the trend is to move more towards cloud-based solutions, because cloud services remain invaluable for many organizations. This is why it is important to be cautious and ask questions to understand the risks versus the benefits by being “cloud smart.”