Charting the Course: An Interview with Rackspace’s Jeff DeVerter on AI and Cloud Innovation

In an insightful conversation with CloudTweaks, Jeff DeVerter, a seasoned IT and technology veteran with over 25 years of experience, sheds light on the evolving landscape of artificial intelligence (AI) and cloud transformation. Currently holding a pivotal role at Rackspace Technology, where he has contributed significantly for over a decade, Jeff brings a wealth of knowledge from his tenure. His strategic leadership has been instrumental in driving digital transformation strategies for prestigious companies like American Express, Ralph Lauren, and Thompson Reuters. At Rackspace, Jeff has been at the forefront of launching and managing a myriad of products and services, alongside spearheading initiatives to bolster the company’s offerings through mergers and acquisitions. 

The discussion is anchored on the findings of the 2024 IT Outlook Report, conducted by Rackspace Technology in collaboration with VMware. This research, which surveyed 1,420 IT professionals globally, delves into the realms of AI, cloud transformation, investment trends, and the challenges of hiring in the current climate. Despite the shadows cast by economic uncertainties, the report highlights a strong commitment from businesses to prioritize IT investments in the coming year, with a keen focus on transformative technologies like AI and cloud services. Jeff’s insights not only reflect his extensive experience but also underscore the strategic imperatives that businesses are considering to navigate the complexities of the modern IT landscape.

With artificial intelligence (AI) emerging as a top IT investment priority for 2024, what are the key factors driving this trend, as indicated by the recent Rackspace Technology findings?

As generative AI continues to advance and gain significance, 33% of organizations report having completed prototypes and transitioning projects into production, or already having projects underway and planning to expand them. Additionally, 66% of respondents are currently exploring or planning to explore the applications of generative AI. Looking ahead, 67% of those surveyed anticipate having generative AI integrated into some processes or fully integrated into all processes within the next 12 months.

While many organizations currently use AI for fundamental tasks such as sentiment analysis and code development, respondents identify specific use cases where they expect the greatest benefits. These include security (54%), new product development (50%), increased productivity (45%), and enhanced speed and efficiency in existing work processes (42%). This indicates a broadening scope for the application of generative AI across various domains, with an emphasis on addressing critical challenges and driving innovation.

How is the shift towards cloud transformation, as observed in the latest industry insights, expected to influence traditional IT infrastructures in businesses?

The survey underscores a continuous transformation in companies’ cloud strategies as workloads shift away from on-premises environments. In comparing their current infrastructure to the projected composition over the next three years, there is a 4% increase in private cloud adoption, while public cloud sees a smaller rise. Simultaneously, there are observed decreases in workloads running on other servers, including mainframes and on-premises data centers. The importance of edge computing is also growing, with 30% of organizations planning to incorporate it into their IT infrastructure within the next 12 months, compared to the current 26%. Currently, 75% of respondents state they are employing a hybrid cloud strategy.

Survey participants pinpoint resource shortages and security/compliance risks as their primary challenges in transitioning to the cloud, accounting for 34%. Following closely are concerns such as cost overruns (33%), resistance to change (28%), inappropriate cloud provider selection (24%), and a lack of stakeholder buy-in (23%). These challenges reflect the multifaceted considerations involved in navigating the evolving landscape of cloud adoption.

Considering the significant impact of pervasive AI, as highlighted by IT professionals, what industries or sectors do you predict will undergo the most transformation in the coming year?

In the upcoming year, industries poised for significant transformation are those characterized by specific attributes:

  • Sectors with abundant structured data, such as Financial Services and IT, are anticipated to undergo substantial changes.
  • Industries heavily reliant on Internet of Things (IoT) data sensors, exemplified by Healthcare and Manufacturing, are expected to experience noteworthy transformations.
  • Sectors with a substantial volume of predefined business processes that are well-suited for automation, such as Call Centers and government or bureaucratic organizations, are also likely to witness significant shifts.

The focus is shifting towards edge computing and private cloud. Could you discuss the benefits of these technologies compared to traditional data centers and public clouds?

Private clouds sit at an interesting intersection of public cloud and traditional datacenters.  They now have many of the characteristics found in a public cloud like WEB or API interface for management, burst capabilities, variable choices in the infrastructure that gets provisioned, and the ability to implement cloud native programing techniques.  This, then, get’s paired with the single tenant nature of traditional data centers, additional security, and custom infrastructure for specific computer needs.  Lastly – there is the flexibility of where the cloud runs as a bespoke private cloud can be implemented as close to the users as possible.

What are the primary challenges in integrating generative AI into business processes, and what solutions are companies adopting to overcome these obstacles?

With the recent integration of generative AI into the business mainstream, 42% of respondents express challenges in evaluating its business value. Establishing a concrete business case proves difficult, particularly in demonstrating return on investment (ROI). This difficulty is partly attributed to the time required to accurately measure productivity gains driven by AI. Despite high rates of buy-in (with only 4% citing a lack of senior management commitment), quantifying the benefits of AI implementation remains a formidable challenge.

The top three challenges encountered during AI implementation are as follows: 42% face difficulties in measuring and proving the business value of the AI solution, 38% grapple with a lack of technological infrastructure to support AI, and 32% struggle with the storage of skilled AI talent. Additionally, 24% of respondents cite a challenge in dealing with the lack of clean data.

Addressing data governance and AI ethics is crucial. How are organizations planning to tackle issues like data privacy and bias in AI systems?

Organizations are addressing this matter through a systematic process and actively seeking strategic partners to lend support. It starts with awareness that data is an asset which requires a unique approach to ensuring its privacy and security and that this data has flaws.  Working with partners to review the data and the bias that may exist in is quite helpful as an outside in approach helps recognize and expose these issues.  As the data is cleaned, it can then be used as part of a larger AI endeavor.

The recent Rackspace Technology report points to a talent shortage in IT. What strategies would you recommend for companies to attract and retain skilled IT professionals?

As companies increasingly prioritize artificial intelligence (AI) and cloud technologies, the challenge of securing and retaining skilled talent has become pronounced. Survey respondents highlight a shortage of qualified workers as their primary concern (69%), while 47% recognize the necessity of offering higher salaries to fill critical roles, attributing this need to the rapid pace of technological advancements leading to elevated IT labor costs.

The relentless evolution of AI, Cloud, Security, and other technologies underscores the importance of cultivating a workforce that embraces lifelong learning and adapts to change. This challenge emphasizes the necessity for a revised workforce strategy, emphasizing adaptability, problem-solving skills, and continuous learning alongside the latest technical competencies to drive innovation.

To combat the scarcity of IT talent, 48% of organizations adopt a multifaceted approach, concentrating on fostering a positive work environment. This includes efforts to promote work-life balance and cultivate a supportive culture aimed at attracting and retaining IT professionals. Simultaneously, many companies (44%) are investing in professional development and career advancement opportunities, recognizing that upskilling existing talent is a more cost-effective strategy than recruiting new skilled employees.

In light of rapid technological advancements, what advice would you give to IT professionals and students to maintain their relevance in the industry?

The journey of learning extends beyond obtaining a degree or completing a project. It is the responsibility of everyone in IT to continue to learn and adopting modalities that align with their preferences—be it classroom sessions, reading, video tutorials, or other avenues. Staying abreast of technological advancements is a shared responsibility among all IT professionals. While companies may offer financial support for classes or certifications, the driving force behind continuous learning lies within each technologist, making personal commitment the catalyst for professional growth.

Investments in AI for tasks like security and new product development are on the rise. How do you foresee these investments influencing business efficiency and innovation?

AI excels in its role when it collaborates with humans to enhance productivity. In the realm of security, the sheer volume of endpoints and datapoints surpasses human capacity for assimilation. AI emerges as the ideal tool to aggregate this vast amount of data, pinpointing critical vulnerabilities, offering remediation recommendations, and detecting data trends that may evade human observation, thus fortifying defenses against potential breaches.

How do you envision the landscape of IT and technology evolving over the next five years, especially considering the trends in AI and cloud transformation?

The trends in the commoditization of IT services, observed over the past two decades, are poised for an exponential acceleration. Notably, artificial intelligence (AI) will play a pivotal role in alleviating IT professionals from routine tasks, enabling them to focus on more sophisticated work. This shift implies that human strengths, such as creativity, will be harnessed to undertake tasks with a higher impact. The impact of this transformation will be evident across various domains, including application development, security, systems administration, and analytics.

By Randy Ferguson