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Tag: IT Services

Cloud is Good

Cloud is good! Shared computing services—whether applications or platforms—available over internet have granted unprecedented access to technology sophistication to small and medium sized businesses.

The potential inherent in information technology has been immense and the possible impacts are only getting more pronounced. Technology not only bolsters efficiencies, but also influences fundamental changes in the business models themselves. But getting technology to work for a particular business has traditionally been arduous, requiring significant expense, effort and skills. As such, access to “enterprise-class” has been limited to large businesses who can afford to invest for required application sophistication, reliable deployment and operational support.

Cloud changes this in a fundamental way. It allows the businesses access to the benefits of technology without worrying about (most of) the underpinnings—building, deploying, operating, maintaining, and investing. Thus the businesses can focus on what technology can deliver, rather than delivering technology. This is great news for small and medium businesses. Let’s see how:

Choice: The sheer ease with which businesses can explore, assess and select various options on cloud is breathtaking. Be it messaging, collaboration, accounting, CRM, or any other application—businesses have enormous choice. Compared to the traditional on-premises technologies, cloud affords the ability to try at much lesser costs and commitment. A vibrant community of users can also be quite helpful.

Costs: Cost savings could be a big advantage to SMBs as they adopt cloud. These savings accrue primarily because cloud services are charged based on usage. Thus, costs of idle resources or over-capacity are saved. Further, as cloud involves mostly op-ex rather than cap-ex, it can be much more cash flow friendly for an SMB. On demand nature of cloud services mean that the business would not need to carry costs of computing resources no longer in need.

Speed: SMBs can ill-afford large deployment or upgrade projects and cloud dramatically reduces time taken to provision, setting up services and making applications available. Also, cloud absolves businesses of intensive efforts required to upgrade to newer versions. System patches and upgrades, typically, happen in the background with user impact reduced to the minimum.

Access: SMB’s also need 24/7 access to their applications and data regardless of location or device. Increasingly, businesses rely on their mobile devices (phones or tablets) while on the move or even at the workplace. While cloud applications, by definition, are available anywhere and at all times, growing consumerization and democratization of internet access (less reliance on corporate networks) are driving cloud application providers to be more available and accessible. Thus cloud applications are much more likely to be available (or at least compatible) for a variety of devices—operating systems, browsers, or form-factors.

Scalability: It is one of the more fundamental promises of cloud. Vast computing resources shared across a variety of users enable scalability—availability of computing capacity (be it computing power, storage, number of users, etc.) on demand. From a business’s perspective, usage based pricing allows valuable flexibility. Thus making available an IT environment which is dynamic and fluid with the ability to add new businesses, spin up new services and respond to the ever changing customer needs.

Performance and support: Most cloud service providers design their offerings and are set-up to certain standards for reliability, availability and performance. In contrast, IT infrastructure and set-up at many SMBs has grown organically and thus end up being difficult to manage with clear performance expectations. Most cloud providers offer service level agreements (SLA’s) which can include parameters such as application performance, availability, datacenter uptime, host failure and migration, etc. Further, support is typically available 24×7 to assist with issues, and other such events.

Standardization and Integration: Increasingly cloud services are adopting common standards—be it for data representation, application interfaces or for underlying aspects of identification and authentication. This has led to possibilities for SMBs wherein they can leverage a diverse selection of technologies to suit their needs best, and still enjoy a level of integration, single sign-on, etc. Of course, it is considerably easy to enable integrated experience if the cloud applications belong to one platform or family, still there is a growing number of integrating services and options that may be used.

Skill Needs: Managing IT, even in an SMB, could be very effort intensive. As number of applications, users and complexity grows, a diverse and relative large set of professionals (whether outsourced or as full-time employees) may be needed. This can include administrators, database experts, network administrators, application developers, hardware technicians, support personnel, etc., apart from technology managers and architects. This could be daunting for most SMBs. The portfolio of technology skills needed with cloud adoption changes for the better. Cloud enables a business to focus on the purpose and direction of IT—whereas much of the operational, maintenance and support aspects are responsibilities of the cloud service providers.

Security: Contrary to popular perception, cloud applications can be much more secure, especially for small and medium businesses. It is a fact that ensuring security is hard. The applications and infrastructure need to be continuously monitored, maintained, patched; in general remain ahead of looming cyber threats. That requires enormous expertise and expense, which a small or medium sized business might not want to organize. Similarly, more basic threats to application and information availability like power or network outages, simple human errors, hardware failures, etc., are much better addressed when specialized cloud service providers bring together scale, skills and investments. Also, reputable cloud application providers have, in general, invested significantly in compliance to security standards, operational best practices, infrastructure redundancies and people preparedness.

Technology Innovation: Much of the new technology development is happening in the realm of cloud. Technology companies like Microsoft have adopted cloud as primary focus, whereas offerings from companies like Google or Amazon have been almost entirely cloud based. Many innovative startups who are enabling new use cases and applications are building those for cloud. Be it newer ways of connecting to customers, or more efficient collaboration with an organization—some of the most innovative tools are available as cloud only. No business regardless of its size can afford not to consider these technologies.

While there are many compelling reasons for cloud adoption by SMBs (and also by larger enterprises to a significant extent), it is important to understand that there are still important caveats. While cloud-first approach makes eminent sense, businesses must consider relevant aspects to decide if a non-cloud option might be appropriate. For example, not all cloud applications have achieved functional parity with their on-premises equivalents. This is especially true with applications involving high levels of customization and integration, like business process automation involving legacy applications. Other considerations could include regulations (location or ownership restrictions on data), bandwidth and quality of connectivity, application performance needs, etc.

It is also important to appreciate that cloud adoption can take many forms. While at times a cloud application might not fit the needs, cloud hosting with dedicated deployment may still be a right choice. Variants of cloud services—infrastructure, platform or application—can bestow a valuable choice, so as choice of going hybrid. This highlights the fact that cloud does not preclude the need for IT and architectural expertise. As such, with right expertise and adoption assistance, SMBs have indeed quite a lot to gain from cloud.

It might not be feasible for most SMBs to dedicate expertise and attention to identification, selection and deployment of technologies. Technology choices can be bewildering and would require a good understanding of the business and its context. At the same time, not acting quickly enough might jeopardize business’ competitiveness or even survival. It is also pertinent that associated risks are managed as well–so that a business can innovate confidently. Advaiya can be an organization’s virtual CIO, providing assurance and supporting innovation, thus giving the much-needed edge.

Republished from Advaiya Blog. Earlier published as an article in Business Standard.

From Efficiency to Advantage

From efficiency to advantage. This is the story of technology, and with some lag, story of IT services industry. Doing the same thing cheaper, faster or better is no longer sufficient.

Information Technology has been a great driver of speed and efficiency. Technology ROI has traditionally been seen as a function of efficiencies and the costs. This equation drove adoption of technology by industry globally, squeezing more efficiencies as technologies improved, and reducing costs by outsourcing, consolidating, and standardizing.

The twin vectors of efficiency and costs–building and feeding on themselves–have, since a few years, landed into a new territory. The quest to squeeze more efficiencies has paled against allure of creating sustained and unique advantage for the business made possible by digital innovation. Similarly, functional cost reductions via optimizing on how activities are performed have reached limits and the specter of wholesale outsourcing via cloud, for example, disrupts the traditional cost calculus. These have become universally available and easily accessible, thus no longer are source of advantage.

This is new, and strikes at the basis of the traditional IT industry business models. Interest has waned for IT services’ pitches of providing the commoditized capabilities at a reduced cost or a more optimized setup. Businesses have a reached a point where such efficiencies have become a norm and do not provide sustained competitive advantage. They surmise that the daunting task of transforming themselves cannot be helped by mechanistic, efficiency-minded tech services companies.

There are two key frictions at play here. One is past v present, and another is present v future. And their domain is bigger than the IT services or tech outsourcing. It is impacting all areas of tech industry.

Firstly, what is valuable today is different from what was yesterday. While there is some value in getting something done in a particular way, again and again, it does not confer ‘advantage’. As technology forces a rethink of their businesses, companies try to find “advantage”, even in the supposedly mundane tasks where, till some time ago, it was all about just getting those done. That means, it is no longer relevant to assess value in terms of effort. The worth of a job must be thought in terms of “advantage” that it can garner. That’s more complicated than costs per hour, much more intimate and ephemeral. Impact of innovative technology adoption–let’s say of cloud or machine learning–cannot be assessed with frameworks of current practices. So, management techniques and business models based on selling (or saving) effort at some sort of time rate are breaking down.

Secondly, the impact of the new capabilities of technology on technology industry itself is more pronounced and profound than it has ever been. While not there yet, the asymptotic nature of technology work is starting to become visible. Algorithms are not just replacing non-tech workers, but also techies. Today’s good programmers are taking away jobs from tomorrow’s. The power shift is multi-directional with the middle getting squeezed away. This poses an existential imperative for the industry and its constituents. As it gets automated or becomes available in smart user accessible chunks, merely delivering technology would cease to be a business or a job. Instead, those who deliver ‘advantage’, via technology or otherwise, would thrive.

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