Achieving Business Growth Through The Cloud
Traditionally the argument about cloud computing revolves around its cost-efficiencies and its
scalability. For some businesses it has also been perceived as a fast way to grow. Cloud converged
infrastructure firms such as VCE and HP, for example, argue that their own offerings enable
organisations to speed up their ability to go to market with new cloud services and applications. The
reasoning is that if a company can deliver these faster than anyone else, then they can gain a
competitive advantage over their rivals in their industry.
Furthermore by having a cloud solution, such as a public or hybrid cloud, firms such as retailers with
an e-commerce capability will have the capacity to respond quicker and more economically to the
peaks and troughs of seasonal market demand than they would by spending invaluable time and
money on a purchasing system that would most probably remain either idle or underused for most
of the year. Yet with the help of a cloud service provider there is no need to own the infrastructure,
and so a cloud service can be embraced as and when there is a need to upscale or downscale.
Growth enabler
The benefits of being able to focus on operational expenditure (OPEX) over capital expenditure
(CAPEX) are often touted as reasons for moving to the cloud, but they aren’t concerned with
increasing sales or profitability in their own right. What they reveal is that cloud technology is an
enabler of growth, but it is not the catalyst of it. To grow companies still need to fall back on their
people first in order to develop traditional corporate, sales, marketing and business process plans.
For this reason Tony Lock, Programme Director at Freeform Dynamics, believes that the cloud is
never the ultimate answer. To achieve growth he argues that businesses need to do things better
than they did previously. You can also find growth through other means than deploying cloud
applications and services – much depends on an organisation’s business model.
Therefore companies need to ensure that their cloud deployments enable them to improve their
performance by making their business processes more efficient than they were, enabling them to
manage their IT workloads better or an improved ability to increase e-commerce sales. Much
depends on the business model of the organisation and what it is comfortable with.
Don’t run, walk
“It’s a misconception to put your systems into the cloud and then expect to grow because you still
really need your business to look at its strategy, to review back and front office systems, to consider
how it engages with its prospects and clients, and all of those things that are to do with an
organisation’s overall strategic plans”, says Civica Services managing director Steve Shakespeare.
Once companies have developed their business strategies they can then consider how a public,
private or hybrid cloud could enable them to achieve their desired business outcomes.
“I think there has got to be a strategic imperative: we are living in an increasingly digital world where
there is growing demand for better digital experience – whether that’s about delivering a service to
customers or to your employees”, says Paul Bolt - Rackspace’s EMEA vice-president of technology
practices. Although he agrees that the cloud is not the only way to stimulate growth, he believes
that companies ignore it at their peril. This is because there are a number of examples where
organisations, such as Blockbusters and Kodak, have failed to see the market changes occurring
around them. The cloud is therefore a complete re-imagination of the way people act, and in his
view this will make the next five years incredibly exciting from both a business and technology
perspective. It will enable new ways of doing things and it can lead to new revenue streams.
Customers don’t care
“The cloud is enabling the way local authorities and businesses interact with their audiences, and
some customers may want a personal view of the services you deliver…that’s the key goal and this is
about their transaction history, cross-selling products and services, etc.”, says Shakespeare. He says
the cloud not only enables companies to respond to changes in demand, but permits them to share
and analyse data in an easier way. With this capability it becomes possible to concentrate more on
delivering business outcomes more than cost-cutting. He says that customers themselves don’t care
so much about the technology, but they do want cloud services to be reliable and secure.
Even though there is the shift towards thinking more about business results than cost efficiencies, to
grow organisations still have to control and manage their costs. Ironically a more efficient business
will be able to increase its profitability. So can the cloud reduce the associated operational expenses
too? Darren Watkins, Sales Director, of Virtus datacentres says his company works with a number of
start-up businesses to reduce their costs and their time-to-market variables: “The public cloud
involves an initial capital reduction and then it helps you to get to market by deploying robust IT; it’s
a fast way to get to market and eventually they can adapt it to become more of a hybrid model”.
Develop understanding
“It’s about pushing features and functions out to the end users as quickly as you can; the days of
two-year versions of applications has gone as software updates now occur on a daily basis”, says
Bolt. He advises that it’s important to understand the economic models surrounding IT, the various
technologies that we can consume and to how to manage them. In other words it’s no good to rush
in and adopt the cloud because it’s the latest and greatest trend. So, to build the business case for a
cloud deployment, CIOs must diligently work with chief financial officers (CFOs) to make sure that
any technological purchase is actually going to deliver business benefits.
“If you look at a business case to transform a business to a cloud system, you will see that there are
a number of entry points to consider”, says Simon Withers – Sunguard’s vice-president of
infrastructure-as-a-service (IaaS). For example, in his opinion if an organisation has a new application
it should be developed on a cloud platform such as a public cloud. This is because there is a high
degree of recoverability associated with it, and so test and development functions may use one.
DevOps testing
Test and Development can also use the public cloud to spin up or down a cloud to prove that an
application works, or it can be used to recover an application that exists in a cloud to show how
quickly it can be restored to its complete functionality in a certain amount of time. Once the
application is moved into production, Test and Development are no longer required. It’s then
possible to begin a cloud transformation over a prescribed period of time.
Supporting big data
Big data is one area where cloud can work, allowing large volumes of data to be analysed. “Big data
may shape your product roadmap and help you to become more effective, and it’s often seen as an
external tool to enable businesses to better understand the world…but they are also looking
internally at it to see if there is an opportunity to drive efficiency within the business and cloud is
vital to this”, explains Bolt. He adds that the cloud allows organisations to cost-effectively crunch
huge volumes of data today in a way that is cheaper than it would have been a few years ago.
Enabling collaboration
The cloud can also enable collaboration. “To really enable the potential for growth, businesses need
to have a strategy for collaboration with their colleagues and business partners, and CIOs will always
come up with the fact that there needs to be an element of strict governance around it – including
resilience, security and compliance”, explains Withers. With the business plan there also need to be
some consideration about what the organisation’s exit strategy will be from a relationship with, for
example, a cloud service provider that goes into liquidation. Data is the gold of many businesses
today, and so there needs to be a plan that considers how it can be easily retrieved.
“We are seeing a cloud hangover that is being experienced by people who haven’t had a strategy,
and they have found that it wasn’t 100% right for their businesses – instead they have discovered
that it would have been better to have a hybrid cloud strategy”, he says. Organisations are therefore
advised to think about the business outcomes they want to achieve, to demonstrate business value
through innovation by understanding applications and how they deliver the desired business results,
to comprehend the increased pressure of data compliance – new EU laws are on the cards for 2017,
and he also advises that companies should always analyse whether or not the cloud actually brings
them any benefits in the fact of the growing complexity that exists across different clouds.
Realising the benefits
Matthew Larby, the product strategy director at Virtus datacentres, concludes with some equally
important points. He advises businesses to focus on their lines of business and not just on the
technology of cloud computing. He agrees that it’s vital to assess the cloud to make sure that the
organisation is enabled to gain the best performance out of it. This entails an analysis of the
workloads that will be placed in the cloud and how they perform, and whether they should reside in
a public, private or hybrid cloud. At the end of the day the real benefit of the cloud isn’t about cost;
it’s about business growth and scalability that’s backed by a strong and resilient business case.
By Graham Jarvis