Cloud technology is universally relevant. A recent study by IDC projected $70 billion of growth by the end of 2015, in the public cloud market alone. Furthermore, it estimated that the number of new cloud-based solutions will triple within five years.If you are already investing in cloud or have plans to do so, you’re in good company. According to a research by Goldman Sachs earlier this year, spending on cloud computing infrastructure and platforms is predicted to grow at a 30 percent CAGR between 2013 and 2018, compared to just five percent over the same time period for overall enterprise IT spend. Thanks to a lower barrier to entry, every company should and can adopt a cloud strategy, regardless of size or industry, whether they are single or multi-location, local or global.
"Defining cloud and identifying its drivers in the interconnected network are crucial. But it’s not enough"
What is cloud? Cloud is something both technical and vague; and as such, it generates a great deal of debate and argument. But it can be clarified in three simple steps.
1. It’s not “here”: The technology isn’t on premise at the user’s location. It isn’t local software. The technology and intelligence are instead operating from someone else’s network or data center.
2. It’s “as-a-Service”: Cloud technologies allow businesses to pay only for what they use. This shift away from CAPEX to OPEX is at the core of the economic argument around cloud. Indeed, by 2016, says IDC, there will be an 11 percent shift of IT budget away from traditional in-house IT delivery, toward a wide spectrum of cloud technologies as a preferred delivery model. By 2017, 35 percent of new applications will use cloud-enabled solutions to streamline rollout of new features and business innovation.
3. It’s outsourcing: The bottom line is that businesses of all sizes are faced with significant staffing challenges when it comes to IT and telecommunications talent. While trying to grow and keep pace with the rapidly changing technology landscape, cloud, when leveraged correctly, solves the staffing problem. It isn’t designed to replace current IT teams, but rather to support them and free them up to work on more strategic initiatives.
Cloud is Changing the Network
Key to the cloud transition strategy is the concept of the interconnected network. Workloads are increasingly moving to and between one or more of the following four clouds:
4. Colocation (COLO)
So, how is cloud changing the network? As cloud adoption increases, the ways information technologies are deployed also change, reallocating technology costs and usage patterns while creating avenues to consumption of goods and services, as well as enablement of new innovations and business models. There are three primary drivers:
1. Dynamic Workloads: Applications, users and content are moving continually from public to private cloud networks, from SaaS to COLO and back again. Networks must be able to support this rapid shift.
2. Security Chaos: The complexity of interconnected networks adds very real security issues. Companies of all sizes are susceptible to exploitation and data leaks. It’s important to remember that software isn’t the only risk area– human capital is just as vulnerable. The expertise that companies must maintain to fend off ever-changing attacks is simply not practical.
3. Managed Services: It’s no secret that technology is moving at breakneck speed. For a business to succeed, there are many tasks that have to happen every single day for the company to remain current and relevant in terms of technology. It poses important questions around strategy, efficiency and innovation–is this truly the best use of a company’s internal IT team’s time and resources? Cloud is disrupting traditional business models and, when leveraged correctly, is leading to increased productivity and revenues.
The Technology-Enabled Customer Experience
Defining cloud and identifying its drivers in the interconnected network are crucial. But it’s not enough. We also must understand why these things are important.
At the end of the day, every company, regardless of size, product, service or geography–is a technology company. This is because technology is at the core of improving customer experience, which is the single biggest factor to competing and winning in today’s economy.
Understanding the value and, indeed, necessity behind cloud as a driver of customer experience and business enablement is now non-negotiable. The list of companies that are making technology-enabled customer experience a fundamental driver for their business is growing rapidly. Apple, Uber, Chipotle, Zappos, all these are examples of companies that are leveraging technology to solve problems and differentiate themselves in a crowded marketplace. The applications; the interconnected cloud; the strategy–all are more important than ever before.
Technology is the primary enabler of customer experience. If you aren’t thinking of your company as a technology company, regardless of the product or service you provide, you’re already losing cloud ground. Leveraging technology drives improved customer experience, and cloud allows companies of all sizes to access technology they may never have the opportunity to access otherwise.