By Nicholas Ismail, Global Head of Brand Journalism, HCL Technologies Ltd.
In today's digital world, a company's technology vision and its third party partnerships play an important role in it's business success. The cloud forms the backbone of the delivery of this tech vision, allowing for transformation and innovation at speed that translates to tangible business growth.
There is a strong correlation between cloud adoption and increased revenue with business goals reliant on an effective cloud transformation and strategy.
The move to the cloud
The cloud allows businesses to be flexible and agile in their approach to innovation. The cloud allows businesses to scale projects, store more data than ever before and apply emerging technologies to that data, without worrying about the concerns of capacity planning.
The move to the cloud also enables significant cost savings for businesses. The emergence of computing at the edge allows organizations to be on the ground with all the benefits of a virtual environment – essential for the rise of concepts like smart cities with autonomous vehicles.
It’s no wonder that in 2022, Gartner estimates global cloud revenue will total $474 billion, up from $408 billion in 2021. And, over the next few years, its analysts estimate cloud revenue will surpass non-cloud revenue for relevant enterprise IT markets. The future of revenue, innovation and digital transformation lies in the journey to the cloud.
This article will explore the key drivers for moving to the cloud, the benefits of adopting this approach in terms of maximizing business value and how to achieve leadership buy-in to make the cloud dream a reality, while explaining a few of the challenges along the way.
Key drivers for moving to the cloud
There are six key drivers influencing the move to the cloud.
Agility, efficiency, flexibility and scalability
When cloud computing entered the mainstream in the mid-2000’s, it allowed organizations, previously tied to the strict rigidity of on-premise, to take advantage of the agility, efficiency, flexibility and scalability of a virtual environment:
Agility is a key macroeconomic driver for the move to the cloud; adding business value by providing the ability to rapidly develop, test and deploy applications and workloads to drive business growth. IT teams, with the power of the cloud supporting them, are proactive rather than reactive when it comes to solving problems and testing innovations.
Cloud adoption helps organizations to be more efficient by streamlining processes to increase productivity and meet changing customer demands at speed. This helps spur business growth and add value to the business.
The cloud offers businesses and its users the flexibility to work from anywhere. This not only increases collaboration and fosters innovation, especially for global organizations that operate in different geographies and time zones, but also enables businesses to avoid disruption. Flexibility is crucial in certain scenarios, such as the Covid-19 pandemic, where IT services and projects had to be maintained despite work from home mandates.
Operating in a virtual environment allows businesses to scale up or downsize IT projects or workloads at the click of a button. Scalability defined as the ability to increase or decrease IT resources depending on demand is essential for business growth and equally important to manage costs.
The cloud enables greater cost savings, certainly in the short term, during the initial migration of workloads and applications. These cost savings predominantly appear via outsourced hosting or infrastructure-as-a-service. Additional cost benefits come from reducing the spend on IT staff, equipment and software.
With the move to remote work, organizations are facing the challenge of skyrocketing cloud computing costs. As cloud usage surges, so can the costs.
Data security in the cloud
Cloud storage is more secure than on-premise. Neither are invulnerable, but with cloud services, constant data security is available and IT managers can effectively control user access.
However, the need to keep sensitive data in certain locations due to regulatory requirements in key industries has created the need for certain workloads to move back on-premise – cloud repatriation – into more secure, encrypted and localised environments.
It’s important to consider security best practices before moving to the cloud.
Whether you’re an employee, consumer or client, people expect seamless digital experiences that solve their problems and make their lives easier. The cloud’s attributes highlighted such as scalability and agility have enabled an explosion of new digital experiences including cloud chatbots and mobile payments services that deliver these expectations.
Traditional ecosystems fail to support transformation initiatives. The outdated technology capabilities are too expensive and slow software release cycles of traditional ecosystems make it difficult to keep up with changing market demands. In addition, existing infrastructure can’t cope with the advanced analytics that’s needed to gather insights and transformative actions from the data.
The cloud solves all these problems and allows for effective digital transformation that helps businesses realize new opportunities.
The benefits of these drivers were felt in the pandemic, with cloud native or forward-looking organizations swiftly able to avoid disruption by migrating workflows online, continuing to innovate and maintaining business productivity.
There is no doubt that the pandemic accelerated digital transformation and global cloud adoption accelerated board level thinking around technology and its role in business. As a result, an organization’s technology and business strategy, propped up and supported by the cloud, are more closely aligned than ever before. Their success depends on each other.
Leadership buy-in for cloud success
CIOs and CTOs need extensive leadership buy-in to turn their vision into a reality. Leadership buy-in enables the company to take advantage of cloud services and increase cloud workload migration to maximize business value and deliver transformation. Despite the change in attitude experienced during the pandemic, this can be a challenge due to past cloud failures or slim returns on investment following expensive cloud migrations.
To demonstrate the value of the cloud, tech leaders should:
Carefully invest cloud platforms in focused business areas that are going to deliver noticeable results, such as increased revenues or cost savings.
Consider the whole business when rolling out a tech solution or investment. How does it fit in with the business’ strategy?
Change the focus from projects to products – an offering that can be consumed by employees or consumers that delivers tangible results. A product-centric model is key for digital transformation.