The role of the CIO is changing, and that change is being driven by the cloud.

That was the key message from Derek Kay, a director in the CIO advisory practice at KPMG, the professional services firm.

Speaking at Cloud Expo 2014, Kay warned that the cloud services like software as a service (SaaS) is shifting technology spending away from the IT department and towards the business, with business units investing directly in technology on a services basis.

“Cloud is very much service based: services that deliver business outcomes,” he said. “Business users feel quite liberated in being able to go direct to the cloud. The technology is being abstracted to point where it is invisible… But the reason the cloud is different is, it changes the way the business user thinks about IT.”

CIOs, Kay said, tend to have a high level understanding of applications, data and hardware, and of managing large system integration or outsourcing contracts. But those skills do not always work as well in a cloud-based world.

“Cloud services are cheap and come under the bar of procurement,” said Kay. “Being able to get in fast and scale quickly appeals.” But, although cloud services provide a consistent end-user experience, they also provide a one-size fits all contract, which might not suit a business’ needs.

CIOs need to be able to interpret these contracts, to ensure the business is buying the right cloud services, from a security, governance and business continuity point of view. But the CIO also needs to integrate cloud services with “legacy and also internally-developed IT systems.

“IT needs to become a broker. There are also legacy systems that will not go away. Internal systems may even grow. But more cloud services will be added into the mix,” said Kay. “You have to orchestrate those services on behalf of the user.”

One of the greatest battles facing IT organisations, Kay says, is fragmentation driven by software as a service, and the cloud.

“The need to keep IT orchestrated rather than seeing it fragment is greater than ever,” he said. “You don’t want IT devolution to occur to the point where business continuity is compromised. Dealing with that is a leadership role, and needs someone who can work with the business to work out what their needs are.”

This, he cautioned, still needs to be a “C-level” position. “That is a serious, heavy-duty role,” said Kay.

“You need the right C-level exec to manage the transformation to a brave new world of a hybridised environment.

“You need someone to drive differentiation and innovation on behalf of the organisation. The CIO of future needs to be able to lead IT on that journey, not just keep the lights on, but act as a real partner and drive value to the business.”