Top 4 Tips to Master Change Management in Cloud Transformation
August 22nd, 2023
There’s a paradigm shift in the cloud adoption conversation, from “when it will happen” to “it’s happening right now”. Many financial institutions (FI) today deploy cloud as part of their core computing infrastructures.
But cloud transformation is a strategic decision that extends beyond the borders of IT. It encompasses people, leadership, organizational culture, skill sets, and operational models.
Change management is a crucial component of the cloud journey. It can play a huge role in exploiting long-term cloud value, such as:
- Minimizing downtime
- Accessing emerging technologies
- Accelerating speed to market
- Improving innovation opportunities
This mindset change involves several aspects, like the relinquishment of tech ownership, determining which processes are still relevant, and upskilling and reorganizing labor resources.
Considering the magnitude of cloud transformation, managing the change holistically can address organizational challenges and facilitate a smooth transition.
Four Change Management Strategies for Successful Cloud Transformation
There are four practices to help FIs manage complex organizational changes and contribute to a consistent cloud transformation journey:
#1 Prep your Teams for Change
Preparing your teams for change matters because it helps maintain motivation and alignment with your cloud transformation objectives.
Key to success:
- Ensure your teams fully understand the differences between operating in a cloud environment versus an on-premises data center
- Train and upskill your teams to help transform their skill sets
- Foster enthusiasm about the journey ahead and excite your teams about the changes
Suppose you’re moving to a hybrid environment, for example. There should be a solid understanding of how your FI is:
- Running applications and services in your data centers
- Integrating applications and services with Software-as-a-Service (SaaS)
- Operating the pure cloud environment
Identify the critical work streams that must be developed that will comprise the main building blocks of success, such as security. Target the controls that must be established in the cloud and which tools will deliver that enhanced security position. Usually, this requires extensive team training because it’s likely that many of them are unfamiliar with these tools.
You also need to establish robust financial controls to inform, optimize, and operate efficiently, or you risk compromising the true value of what you’re trying to gain from the cloud.
Strategic partners are another important angle. They can tackle the heavy lifting so you can take full advantage of cloud capabilities. This ensures you can focus on the personal component, like getting your teams on board for this new endeavor, educating them about how new tools will make their jobs more efficient, explaining how they can contribute to the modernization program’s success, and providing them with opportunities to expand their skill set.
#2 Determine What to Delegate to Partners
Determining and depending on partners for tech ownership is a weighty decision that’s paramount to your overall cloud transformation strategy and business case.
Key to success:
- Ensure your technology or cloud partner brings specialized expertise, including experience in various deployment models, industry-specific requirements, and risk management
- Consider the capabilities a potential partner can offer to augment your internal resources and core competencies
- Evaluate if it’s a truly balanced partnership
There are a few considerations to determine what you should control internally and what can be delegated to partners, including:
- Don’t overlook the power of a collaborative partnership that fosters a balanced, win-win relationship and shares a cultural alignment. Work together to define what success looks like so that you can win together.
- Mutually establish mechanisms and accountability to measure and monitor controls to ensure the effectiveness and ongoing compliance of both internal and partner-managed controls and maintain a resilient cloud environment
- The complexity of cloud transformation programs may require several partners that provide various skills and capabilities that can fill in corresponding gaps in your internal resources. For example, one of our clients collaborated with one partner for security controls, another for service integration, and another for niche services and ad-hoc requests
All of these partners form your system with your employees, so your partner should be willing to assist your employees in learning and growing. Ultimately, your workforce needs to be comfortable working in this collective environment and enjoy learning from your partners.
#3 Engage Leadership at Every Level
Leadership engagement is a make-or-break factor in the success of your change management approach. This plays a vital role in driving a new strategy while centralizing teams around a common goal.
Key to success:
- Business, technology, and functional leaders must all embrace the cloud transformation journey
- Commit to an attainable cloud transformation vision and intentional execution
- Be proactive in recognizing and communicating challenges and successes along the journey
Many organizations have shared with us that it’s an ongoing challenge to strike a balance between accelerating a modernization initiative and not overwhelming their teams. You want to fuel the fires of enthusiasm for the change, but you also want to manage expectations.
It’s important that executive leadership, including business leaders, functional leaders, and technology leaders, become advocates for the journey. Cloud transformation simply won’t be as effective if everyone doesn’t understand why the changes are necessary and what they will do for the company.
Be open about the benefits of cloud, including agility, developing new services and products, and innovating faster. This openness should extend to the new skills that everyone must learn to succeed. It’s a mentality of being on a collective journey and learning and adjusting together.
Build your initiative around communication and transparency, including where your organization has triumphed and where you’re struggling. This can help maintain positive relationships, promote continuous improvement, and establish accountability for outcomes and results during the transition.
#4 Don’t Underestimate the Effort and Time to Gain Buy-In
Large-scale changes from cloud transformations can induce fear and blocking behaviors, and business leaders can sometimes underestimate the time and effort demanded to gain buy-in.
Key to success:
- Be clear with teams about what’s needed from them and what’s coming
- Help employees control of their own destiny and adapt to the velocity of change
- Demonstrate your commitment by modeling the desired behaviors and attitude to reduce fear and set a powerful example for your teams
Any kind of change that threatens the comfort of how we perform our jobs can generate anxiety. But change can also create remarkable opportunities, and business leaders must ensure they’re being vocal about the positive aspects while simultaneously acknowledging the common thread of change resistance.
Embrace a philosophy of explicitness regarding your strategy, including what skills and competencies will be needed, and which are likely to become less necessary or even obsolete. One of our FI partners created a successful internal program, enabling their employees to invest in their own learning and development. This enables them to acquire the skills and competencies they need to accelerate their career path, like DevSecOps, and get to that next milestone they want to achieve. Once your employees witness your commitment to helping them upskill and learn, you can garner a lot of buy-in.
Also, address the changes from an end-user perspective and seek their input and feedback. Bring them along the journey with you, from recognizing the discomfort of learning new ways of working to clarifying what they stand to gain.
Creating a change-ready culture is no easy feat, especially given the breadth of cloud transformation across the organization at both the organizational and individual level. But with an intentional approach to change management and the support of an experienced technology partner, FIs can successfully reshape working behaviors and environments.
For more information on benefits of using a cloud solution, go here.