CLOUD COMPUTING enables businesses to reduce costs, scale efficiently and innovate more easily. Cloud helps businesses manage commodity IT and focus on truly differentiating and value creating aspects of their businesses. The pace of technological change particularly in consumer tech is blistering. This ‘technology arms race’ is forcing businesses to exploit more technology in smarter and more agile ways to create new services and products for their customers.
Having a Cloud Computing strategy within your business is essential. Cloud provides opportunities to reduce capital and operational expenditure, improve service quality and responsiveness through automation, scale digital aspects of the business efficiently and drive business innovation with emerging tech.
Cloud Computing Photo Credit: Wikipedia
Cloud Computing and Capital Expenditure
Cloud Computing enables CAPEX (Capital Expenditure) savings as businesses no longer need to invest in costly infrastructure. OPEX (Operational Expenditure) is also often significantly reduced as managing technology estates is expensive and complex. The Cloud services market is highly competitive and economies of scale through cloud can be enjoyed by small, medium and large businesses alike. Most importantly, businesses are freed to focus on their core business model. It is commercially insensible to burn time and money trying to do what others do a whole lot better and cheaper.
Easier maintenance and upgrades
Cloud Computing works through automation. Automated provisioning, monitoring and upgrades means that businesses can ‘devolve’ technical management and maintenance to the Cloud provider. This often significantly reduces costs and technical risks. You should care about service quality, and worry less about the underlying platforms. Cloud frees you from many operational (technical) challenges. Savvy business people focus on differentiation. Move commodity IT to the Cloud and focus on your core business model and products.
Synthesising your Cloud Strategy will help identify what is and what is not core to your businesses success.
Cloud Computing enables Innovation
Businesses can experiment with emerging technologies and techniques using Cloud services to reduce cost and risk. Not sure if Big Data will pay off for your business? Why not find a ‘Big Data as a Service’ Cloud provider and work with them to prove the value? Cloud enabled innovation is a massive opportunity. Costs are not prohibitive, and if it doesn’t deliver, then cancel the service and try something else.
Cloud Services are particularly useful for experimentation with emerging tech or where a technology choice is currently unclear or risky. In this case ‘investing in an outcome’ is a smarter procurement approach. You will also benefit for the learning of others, as Cloud Service providers are constantly working to improve their service offerings and increase their ability to productise emerging services.
As part of your IT Strategy you should think about how you are using Cloud Computing to leverage emerging technology within your business, whilst minimising the risks of ‘backing the wrong horse’.
Cloud Computing and Efficient Scalability
Cloud Computing is exceptional at distributing and scaling compute power. If your business has a ‘number 1 hit’ on its hands you will need to scale fast, possibly globally. Cloud services provide cost-effective options for growth, without having to bear the costs and limitations of in-house infrastructure and apps.
You should think about the scalability of your business model, business processes and ‘retained’ applications. Cloud Computing can help, but it is pointless having massive technology scalability if your business model or delivery processes are fragile.
The benefits of Cloud Computing are substantial. Reduced CAPEX, OPEX, and operational risk, increased scalability and simplified operational management and provisioning. Innovation is further enabled by Cloud (not least by the ability to collaborate internally and with your supply chain and partners). Security concerns remain and are exacerbated by revelations such as the NSA’s Prism, the fallout from which has been multi-billion dollar losses in US Tech sales.
Further Reading on Cloud and Digital Transformation
- Digital Strategy: A Guide to Digital Business Transformation
- The Future of Digital Business Innovation: Trends and Practices
- Digital Disruption: Unleashing the Next Wave of Innovation
- The Digital Transformation Playbook: Rethink Your Business for the Digital Age
- Cloud Computing: From Beginning to End