Business Transformation to the Cloud Ian Grant-Smith

Amsterdam

Strategy, Competitive Advantage and Financial Impact are key ingredients for companies when trying to understand Business Transformation to the Cloud.

So what does it mean to your company now and into the future ?

It's not just about technology but more about Strategy, Competitive Advantage and Financial Impact providing a framework for C Level Executives to understand the benefits of Business Transformation to the Cloud.

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What is business transformation to the cloud ?

The 6 key building block of business transformation to the cloud

People and Organization - this needs to be addressed via a maturity capability assessment plus key C Level Executives need to be educated to make the right decisions at the right time.

Process - by optimizing processes with Cloud Solutions to improve key business

processes to maintain competitive advantage and market share. Methodology - by providing a key governance roadmap to get there. Tools - with supporting solutions to enable the key building blocks above. Technology - being technology agnostic is key as we see more hybrid deployments

with integration becoming the number one question for stakeholders moving to a new sustainable business as usual.

Data - start eliminating barriers quickly, with informed decision processing using in-

memory predictive analytics. Bottom line improvement with enablement to deliver faster, more agile decisions.

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Momentum of the Cloud

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The cloud space has its own momentum beyond what any company can control. A major shift in market share is happening now and if most companies do not adopt a cloud strategy they will not exist in ten years or would have lost a significant market share as this is needed for them to remain competitive or they will be acquired by companies that have.

growth prediction

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Companies need to have their cloud solutions advance their competitiveness and profitability in a measurable way, not just at the departmental level, but especially at the enterprise level. According to "The use of cloud computing is growing, and by 2016 this growth will increase to become the bulk of new IT spend. ... 2016 will be a defining year for cloud as private cloud begins to give way to hybrid cloud, and nearly half of large enterprises will have hybrid cloud deployments by the end of 2017.” In whatever forms it takes at each company, cloud growth will largely be driven by the business, not IT. IT won't push back on cloud computing in 2016 as much as it did in 2008, the push will still come mainly from those in the business who seek more cost-effective ways to provide IT services, decrease time to market, and increase agility which enables ultimate competitive advantage.

The cloud is changing the way we do business something unheard of

previously in the technology space

Every company is now an IT company: Non-IT companies are becoming cloud providers, supporting processes with many of them potentially revenue-generating for outside users. They may not call themselves "cloud companies," but that's what they're doing.

“Loosely coupled corporations” or Hybrid Deployments: This came into vogue with

service-oriented architecture a few years ago, meaning an entity or system stands fine on its own, but can be dynamically linked to other systems to complete new processes. Cloud computing is paving the way for the loosely coupled company – which may be an entity that exists purely as an aggregation of third-party services provided on an on-demand basis to meet customer demands.

"Extremely lightweight businesses": The availability of cheap cloud computing may be

laying the groundwork for a new generation "extremely lightweight businesses." This applies to departments of larger organizations as well being able to design new products without waiting for approval from corporate finance and IT. The distribution model is changing rapidly with companies as companies move to the cloud in a quicker time to market with a much lower barrier to entry giving them far better ROI and giving them a new competitive advantage not forgetting a fraction of the original cost on going cost of ownership.

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The problem that needs to be solved

•  Companies realize they are at more risk than ever before, and that the best way to mitigate their strategic risks is to embrace the cloud in some or most of their organizational design.

•  This risk is real and pervasive.

•  Businesses being public and private, don’t survive as long as they used to.

•  Members of the S&P 500 Index are leaving at faster and faster rates, indicating they are returning less total return to shareholders, as a result of increasing competition from new entrants, value propositions that no longer fit customer demand, and an inability to shift their business model to compensate.

•  According to a recent reporting by The Economist Intelligence Unit, Nearly 90 percent of executives believe that organizational agility is critical for business success.

•  Companies must think of ways to make their processes more flexible. •  Nevertheless, more than a quarter of the executives surveyed by The Economist Intelligence Unit believe they

are at a competitive disadvantage because they are not agile enough to anticipate fundamental marketplace shifts.

•  "The use of cloud computing is growing, and by 2016 this growth will increase to become the bulk of new IT spend. ... 2016 will be a defining year for cloud as private cloud begins to give way to hybrid cloud, and nearly half of large enterprises will have hybrid cloud deployments

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Nimble business transformation in the cloud A competitive, even disruptive capability

Examples of business transformation to the cloud: •  Blockbuster’s brick-and-mortar business model for DVD and video rentals get’s taken out Netflix by using the cloud, Netflix

eliminated significant capital expenditures, improved the customer experience, and ultimately established an entirely new platform for delivering DVDs via mail and streaming content to at lower cost of ownership. Now Netflix are movie into the movie business.

•  Walmart is predicted to lose 10% to 30% market share to Amazon.com in the next ten years due to Amazon's strong cloud-

based business. Walmart has an online presence, but it is behind the curve in terms of customer habits, brand loyalty, and reach.

•  Oracle signed a nine year partnership with “salesforce.com” bringing together a top on-premise services company with deep

database legacy with a company that arguably created the market for software as a service, in which on-premise solutions are replaced with browser-delivered productivity applications. The motivation for this partnership is in part a game of catch-up: Oracle’s Larry Ellison, who had previously written off software as a service and Salesforce, and who wasn’t even clear on what the opportunity in the cloud represented.

•  The magazine, books, and even encyclopedia brands all are reeling from cloud publishing or search engines like google or

yahoo. Crowd sourced content on Yelp and Wikipedia to zero inventory publishing with CreateSpace and Vook, old brands like Newseek, World Book, and Encyclopedia Britanica's business models have been broken.

•  As recently as 2009, Ellison was one of the industry's biggest cloud-bashers, questioning what the cloud really was,” reports

Andreas Zilch. Once a Basher, Now a Believer: Oracle Chief Larry Ellison has Come Full Circle on Cloud Computing.

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Impact on C Level stakeholders

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C Level stakeholders want a stronger business that they own and control. Unfortunately, business transformation offerings from big consulting firms often emphasize only tactical cost savings (carving out a business function to external providers or transferring IT to the cloud), or reduced head count. Their offer of outsourced business transformation depletes most firms of internal competence that drives innovation. Such approaches also focus on the cost side of the equation, something that any company can do. C Level stakeholders want true ownership of their resources and make their own business transformation to the cloud, and beyond that to a seamless new sustainable business as usual through leveraging easy adoptable SaaS (Software as a Service) Technology. Integrating existing IT investments while moving them steadily towards their objectives that define a new business as usual. The SaaS Technology is a cost-effective “consulting ware” for companies to ensure their transformation plan can be well-defined, transparent, manageable through metrics, and most importantly successfully adopted by every employee in their company.

The win/win

Customers seeking “transformation” normally seek a better-run organization with stronger financials, improved business processes, which includes higher profits.

Higher profits, being a function of lower cost basis and/or higher

revenues, and potentially a function of changing one’s sector focus, require complex changes to people and processes.

Often simply a change in technology is a good start so by moving to the

cloud with a new best of breed in a hybrid manner and with the right solution that enables seamless business transformation including integration they can then push the frontier out to give them an innovative competitive advantage.

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