Innovator Chat: The Cloud Drives Business Transformation
The cloud is well known in the IT world as a key driver of internal efficiencies. However, its potential to fundamentally transform entire industries is just now being realized. From improved internal collaboration to more personalized customer experiences, it can help businesses realize new business models and carve out powerful competitive advantages.
Saul J. Berman, Partner, Vice President, and Global Leader of Innovation and Growth Services at IBM, responds to our questions on how the cloud is changing everything -- and how executives can employ it to achieve their business goals.
1. How can the cloud fundamentally change a customer value proposition?
Although cloud computing is widely recognized as a technology game changer, its potential for driving business innovation remains virtually untapped. Indeed, cloud has the power to fundamentally shift competitive landscapes by providing a new platform for creating and delivering business value by enabling new business models.
To take advantage of cloud computing's potential to help enable new or enhanced revenue streams and transform internal operations, customer relationships and industry value chains, organizations need to determine how best to employ cloud-enabled business models that promote sustainable competitive advantage.
2. What really needs to be looked at in doing an ROI analysis of cloud adoption?
A recent IBM study of business and technology executives across the globe indicates there are three predominating patterns of organizations depending on their level of cloud adoption. They are:
- "Optimizers," who use cloud computing to incrementally enhance their customer value propositions while improving their organization's efficiency.
- "Innovators," who significantly improve customer value through cloud adoption, resulting in new revenue streams or even changing their role within an existing industry ecosystem.
- "Disruptors," who rely on cloud computing to create radically different value propositions, as well as generate new customer needs and segments--and even new industry value chains.
IBM SmartCloud Enterprise--IBM's enterprise-class public cloud infrastructure-as-a-service (IaaS)--delivers secure and scalable hosted IT infrastructure with on-demand access to virtual server and storage resources. Well suited for development and test activities, as well as other dynamic workloads, SmartCloud Enterprise goes beyond competitive IaaS offerings with highly flexible services and IBM's proven best-in-class security. Powered by six state-of-the-art green IBM Smarter Data Centers with embedded security and isolation features, SmartCloud Enterprise performance is guaranteed with industry-leading IBM service-level agreements of 99.9% uptime.
4. How is SaaS different from earlier client-server and application service provider (ASP) models?
The breadth, reduced costs, and simplified deployment of the IBM SaaS portfolio distinguishes it from earlier models. The suite of offerings includes analytics; business process as a service; business process management; buying, procurement and sourcing; marketing and web analytics; selling and merchandising; smarter cities; and social business.
5. When moving to the cloud, how do you retain control over critical measures, including performance, security, and continuity?
The ability to customize models of cloud deployment means there is significant variability in companies' level of control over elements such as performance, security, and continuity. Ultimately, an organization will work closely with a provider such as IBM to design the model that best meets their individual needs.
6. What are the key factors to consider in choosing between public, private, and hybrid solutions?
It's important to note that private, public, and hybrid clouds are not strictly distinct, as many organizations choose to build a customized cloud solution out of a combination of public cloud and private cloud elements.
Some companies, particularly those in industries with heightened regulations around data, select a private cloud solution to keep all data and processes behind their own firewall. A company may also choose "pay-as-you-go" pricing that allows them to run lower profile applications on a secure public cloud computing model. With a hybrid cloud option, some processes may be hosted and managed by a partner while others are kept on a private cloud, a VPN, or a VLAN. The majority of cloud users opt for a hybrid cloud model.
7. How do cloud-centric workloads increase productivity and reduce cost?
Cloud-centric workloads increase productivity by speeding and simplifying the process of provisioning the server space required to run or create applications. This means specific opportunities, for example, the development of a new application, can be pursued more quickly and therefore brought to market in advance of competitors. The costs are reduced because fewer resources are required to focus on basic tasks such as provisioning, and can instead be redirected toward activities that are genuinely differentiating. In addition, since an organization is only paying for the server space actually in use, there are significant savings over more traditional models.
8. Is it possible to link public cloud appliances to private cloud environments?
Yes, the are appliances available that serve this need in a relatively seamless fashion.
9. What do you see as the single most transformational aspect of the cloud?
Although cloud has practically become mainstream in the IT world, its promise extends well beyond technological innovation. In fact, cloud computing has the power to open doors to more efficient, responsive and innovative ways of doing business.
As more and more companies embrace cloud computing, we believe those that come out on top will be the same ones that carefully harness the power of cloud for their organization. Whether they choose to become optimizers, innovators, or disruptors, successful organizations will take advantage of cloud computing as a key point of differentiation in driving business value and success.
Discover more. Click to view our infographic on how the cloud drives business transformation.