Looking At Cloud Strategy Through The Lens Of Value - Forbes

http://www.forbes.com/sites/ciocentral/2012/04/29/looking-at-cloud-stra...

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TEC H | 4/29/2012 @ 11:54PM | 2,263 views

Eric Savitz, Forbes Staff

Guest post written by Mike Pearl Mike Pearl is U.S. Cloud Computing Leader at PricewaterhouseCoopers. If the innovative ways that businesses are using cloud computing havent set off alarms within your organization, its time that they did. Enterprises that look at the cloud solely through the lens of technology will be left behind by more agile competitors that use the cloud to develop innovative new business models based on faster time to market, new modes of customer interaction and more efficient operating models. Likewise, IT service providers that market their cloud offerings simply as technology solutions will be outmaneuvered by competitors that position their offerings based on the business value they deliver.

Mike Pearl

Gone are the days when cloud computing could be regarded as just the latest in a long line of technology trends. For leading-edge enterprises, the cloud has emerged as one of the key strategies CEOs are exploring to enable their companies not only to reduce costs, but, more importantly, to empower entirely new business models and offerings for customers. Cloud computing is now to technology what credit is in the financial services industry, as it enables companies to leverage capabilities that they dont own, and to be more flexible and agile in their operations. The cloud is also fueling a cultural shift, as business leaders are no longer limited by the technology they own, but rather empowered by capabilities they can access dynamically. Hence, organizations thinking of cloud computing as a technology phenomenon are undermining its true potential to give them a competitive edge. The Four Value Lenses of Cloud To leverage the power of the cloud, companies must have a cohesive strategy in place and adapt to increasingly complex cloud environments. To help organizations develop their cloud strategies, PwC works with businesses across four value lenses that help executives sharpen their focus across a continuum of value they seek from cost optimization to market

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Looking At Cloud Strategy Through The Lens Of Value - Forbes

http://www.forbes.com/sites/ciocentral/2012/04/29/looking-at-cloud-stra...

differentiation. The approach helps organizations shift their focus from the underlying cloud technologies to developing and implementing a holistic cloud strategy that can lead to significant business opportunities. These lenses include cloud-enabled IT transformation; transforming internal business operations; innovating around new products and services; and energizing broader and more diverse channels and communities. The lenses provide a framework that helps companies transform their organization from IT to business operations and to extend the power of the cloud to develop innovative solutions that can grow their businesses and engage stakeholders in entirely new ways. Cloud-enabled IT transformation, leverages cloud technologies from infrastructure through software to fundamentally change the long standing role of IT from custodian of IT assets to an orchestrator of business services. Companies can leverage cloud technologies to improve flexibility, scalability and cost management while also enabling IT organizations to more directly drive business differentiation. For example, instead of investing in their own large data centers, IT organizations within life sciences companies can now leverage elastic computing resources available through the cloud to analyze large data sets generated by electronic health records (EHRs) for predictive modeling, statistical tools, and algorithms to improve clinical trial design and provide better analysis of disease patterns. Building on this approach, companies can drive further value from cloud adoption by transforming internal business operations and increasing operational performance. This means leveraging the best of what cloud has to offer in the way of software as a service, whether in sales and marketing, human resources or even across the supply chain, which can result in significantly more agility across the enterprise. For example, many organizations adopt cloud-based applications to meet process capability needs that their current on-premise systems may not be able to address. However, while cloud-based services provide ready access to best of breed capabilities, they also usher in a need for strong strategy and architecture skills to help facilitate alignment with the overall business strategy and increase benefits. With a solid cloud business platform, companies will be better positioned to innovate around new products and services to generate additional sources of revenue. For example, many new online media broadcasting offerings use innovative video interfaces over high-speed broadband developed within a cloud environment to create new business models. Cities, like San Francisco, have launched cloud-sourcing solutions, where citizens can enter, monitor, and analyze service requests in the citys 311 non-emergency reporting system. This system has increased citizen collaboration and engagement, as well as shortened the time to address service requests and implement updates even during peak times. With the rapid growth of cloud and social and mobile technology, organizations have an opportunity to energize broader and more diverse channels and communities to connect with an ever-expanding pool of internal and external stakeholders employees, supply chain partners, distribution partners and end customers in entirely new ways. These digital interactions rely on the cloud communications backbone on both the technical and social levels. Companies should orchestrate these multiple social and mobile interactions for a greater share of the market and

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Looking At Cloud Strategy Through The Lens Of Value - Forbes

http://www.forbes.com/sites/ciocentral/2012/04/29/looking-at-cloud-stra...

consumer demand. The ability to engage with audiences across this spectrum creates opportunities for enterprises. With these value lenses as a starting point, enterprises and IT service providers alike can begin rethinking how cloud can enhance the value that their businesses provide. For enterprise executives, this means looking at potential changes to the spectrum of their operations, from their IT organization to their go-to-market and customer-engagement models. The objective should be to develop a strategy for maturing to a new level of technology enablement with cloud computing as its foundation. For IT service providers, this means designing a strategy to provide benefits to enterprise customers, while at the same time addressing concerns regarding security, service levels, and IT governance. Rather than simply offering technology solutions to improve efficiency, they must re-envision their businesses and offer a continuum of services that enhance their customers ability to innovate and collaborate, and, ultimately, create more value faster. Far from being the latest technology craze, cloud computing should be regarded as a strategic asset that helps organizations transform their business models by creating new products and services and new modes of engagement among employees and with customers. Is your organization ready to capture the opportunities?

This article is available online at: http://www.forbes.com/sites/ciocentral/2012/04/29/looking-at-cloudstrategy-through-the-lens-of-value/

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