Cloud Growth Requires Cloud Governance

November, 2022

With continued migration to the cloud, governance becomes even more critical. An organization with an informal and inconsistent cloud governance program will face multiple challenges. Increasing cloud costs, multiple vendors, and complexity can all creep in without a set of policies and practices to govern the use of cloud computing. Therefore, it is not surprising that many organizations see the vital role cloud governance plays in their daily operations, and practice rates are high compared to most best practices in our annual study.

Cloud governance provides a complete overview of an organization’s cloud resources and how they should be managed. In one sense, cloud governance is just one part of overall IT governance. At the same time, an organization with significant cloud infrastructure and applications will need a greater emphasis on vendor management, resource planning, and demand management.

Figure 3 from our full report, Cloud Governance Best Practices, shows where organizations are at each level of adoption. The three green bars make up the practice rate: 21% practice informally, 32% do so formally but inconsistently, and only 28% do so formally and consistently (the maturity level).

Practice Adopotion Stages Cloud Governanced 1030x687 - Cloud Growth Requires Cloud Governance

However, with growth and scale comes complexity. The growth in hybrid and multicloud environments can easily result in data silos as business units adopt cloud tools and platforms without centralized coordination or governance. Fragmented and decentralized systems can certainly be a problem with on-premises systems, but the problem is compounded in complex cloud environments.

Financial management should also be a key focus of the cloud governance program. Cloud costs can escalate rapidly due to poor governance practices. Enterprises must add discipline to multicloud management to achieve cloud optimization and gain greater control over cloud spending. One way to add the necessary structure to cloud governance is the implementation of FinOps.

“Without an overall cloud governance program, you cannot effectively manage costs,” said Avasant senior director Rob Devers. “Knowing what baseline level of resources is needed, and how much to count on for bursting to higher levels, is key.”

In our annual IT Management Best Practices report, cloud governance is one of seven disciplines in the IT governance category. The other six are IT strategic planning, IT project portfolio management, project management office, organizational change management, enterprise architecture, and IT vendor governance. These practices help align the IT organization’s objectives and priorities with those of the business and ensure that the proper controls are established and maintained.

Our full report looks at adoption trends and maturity of cloud governance by organization size and sector. We conclude with practical recommendations for organizations to improve their cloud governance program.

This Research Byte is a brief overview of our Cloud Governance Best Practice report. The full report is available at no charge for subscribers, or it may be purchased by non-clients directly from our website (click for pricing).