There are two secrets you should know about cloud computing: first, it only works if you manage it right. Second, most organizations aren't set up to manage it right.

Companies are learning the value of the cloud through pilot projects for email, development and test platforms, and variable server usage, which offer insight into the technology and its commercial benefits. But these pilots also show that organizations must fundamentally change to take advantage of the cloud.

The key is amped up IT Service Management (ITSM) - particularly demand management, capacity management, supplier management and service integration - that traditionally take a back seat to operational favorites like service desk and incident management because these are fairly simple and usually the first to be adopted by IT teams. As a result, most organizational ITSM has been ineffective to date in cloud environments because it fails to integrate these critical service management functions.

The cloud offers extensive benefits: increased speed-to-market, adaptability to changing conditions, and reduction of fixed costs. But the complexity of cloud computing requires organizations to carefully align cloud resources to business needs. This means managing both the customer-side demand and the supplier-side service.

Most companies simply lack the skills and processes to perform this balancing act right.

On the customer-side, you need a good understanding of your customers' demand for IT services and how that demand is forecast to change over time. Without this information, the proper alignment of business needs to cloud service is difficult at best. This means putting in place the demand management relationship roles, supporting processes and tools to understand how business volumes impact demand for the cloud service, and what the business expects the volume to be over time.

On the supplier-side, cloud computing offers scalability without extensive capital investment. Capacity management allows organizations to scale up and down through infrastructure as a service. But understanding the fixed and variable aspects of the computing and storage environments is critical to defining which infrastructure components can effectively leverage cloud services.

The low-hanging fruit for companies using the cloud is seasonal or one-off spikes in computing power. Capacity management systems can readily identify these. However, most scalability benefits will come from understanding a company's fixed utilization line and how that line shifts over time. The needed capacity management process provides the methods and tools to acquire that knowledge and put it to good use.

The cloud pilots are also showing that supplier management is an important aspect of deploying successful cloud services. IT organizations had traditionally decentralized supplier management, leaving it to various members of the organization, based on the supplier's technology or the portion of a service they deliver. With the rise of strategic outsourcing, IT organizations began to develop and mature the processes to manage strategic suppliers, but many still leave the management of smaller supplier relationships to line leaders.

Unfortunately, the adoption of cloud services by a company significantly increases the number of suppliers IT uses, while potentially decreasing the scope of service provided by each. This means more suppliers fall outside of the traditional definition of "strategic." But in the world of cloud computing, many of the smaller relationships are extremely strategic in that they are critical to getting things done.

This means companies need a more holistic approach to managing services acquired by the IT organization, integrating the suppliers, managing the performance of the suppliers, and the changes needed to improve service value over time.

Service integration isn't a process defined by ITSM. You won't find it in ITIL v3. In a typical environment, the fundamental purpose of ITSM is to enable the business customer through information technology. While IT organizations are good at integrating technologies, the cloud pilots underway are bringing to light the relatively low level of maturity many organizations have at integrating services, particularly from the customer's perspective.

The path to maturing service integration capabilities in the IT organization is found in the ITSM lifecycle. IT leaders need to recognize their cloud services are integral components of their IT services and require the same degree of service management as non-cloud services. They cannot be relegated to the status of hardware or software relationships.

Cloud computing is changing the way IT leaders deliver IT services and value to their customers. These changes require organizations to emphasize IT Service Management to ensure success in the new world of cloud computing.