Why Your Business May Need Regime Change

Here’s the reality faced by CEOs of most public companies:

  • Taking market share, which is much harder than piggybacking on GDP growth, is the only way to satisfy those outsize expectations.
  • To take market share, CEOs have to put their companies in a position to innovate and deliver better products and services faster than the competition.
  • Cloud computing is the best mechanism to enable CEOs to drive that level of innovation.

Hard-charging startups and powerful incumbents alike are adopting cloud computing for one simple reason: it frees up more resources for innovation. Cloud isn’t simply about whether an application is run from a server accessible via the internet or whether a database sits in a remote location managed by a cloud provider.

What makes cloud computing so revolutionary is that it can permeate everything your company does, from back-office processes to how it goes to market. It makes possible the digital transformation companies need to thrive in today’s market.

Much of the technology running in data centers isn’t necessarily bad. But much of it has spawned slow and unwieldy processes designed to match an older, slower, and similarly unwieldy technology stack. Not that many years ago, every company had the same rigid systems in place, so working in that manner wasn’t a competitive disadvantage. Using cloud providers, companies today can essentially outsource every capital expenditure and all of the personnel necessary to run an IT shop, freeing up resources to deliver innovation to the business.

Cloud computing isn’t an adjunct to what you already do—it’s the support mechanism for regime change your business needs to survive. So, the question isn’t whether you should be using cloud computing—it’s whether your company has the right leadership to make the best strategic use of the cloud, and fast.

I realize that’s a pretty provocative statement, so let me explain why today’s turbulent and rapidly accelerating business environment requires a rigorous evaluation of your leaders.

Stress-Test Your Management Team

You need to talk with your leadership team to ensure they are using the cloud to underpin true digital transformation, and not just to keep up with the Joneses. Think of it as a digital stress test for your senior management.  If they fail, it’s time for regime change of a different kind.

For example, ask your CFO how he or she thinks the cloud can help corporate finance. You’ll probably hear that the cloud helps eliminate many investments in infrastructure and maintenance, as well customization fees that can run in the tens of millions of dollars.

But those are mere table stakes. You should also hear about the increased pace of innovation—that years-long engagements with systems integrators will be replaced with regular upgrades throughout the year that cost nothing extra because they come over the web. And those upgrades will include new features that allow the finance function to use the newest innovations in analytics tools immediately.

You also should hear how these enhancements are rolled out simultaneously to remote branch offices and subsidiaries around the world, helping eliminate the inefficiency of disparate systems at different stages of development across departments. If you don’t, your CFO may be too busy looking at last quarter’s results to think effectively about the next quarter and the year to come.

Ask your CMO how the cloud can create new opportunities. You’ll likely hear about the ability to listen to social channels intelligently, to identify new market segments, and to engage with customers in ways that surprise and delight them with world-class service and product innovation.

But you should also hear how the cloud enables new feedback loops that lead to new products and services your customers crave and how it helps create greater brand loyalty and customer stickiness. If you don’t, your CMO may be focused too narrowly on making the current quarter and not enough on making strides to the future.

Ask your CHRO how the cloud helps narrow the skills gap, and you should hear about the ability to recruit more effectively, to onboard and train employees, and to evaluate, identify, retain, and promote the best talent in the organization.

You should also hear about new avenues for sourcing skilled people across new geographies, demographic segments, and experiences. If you don’t, your CHRO may be too focused on filling open positions than discovering the positions and skills for tomorrow.

The Bottom Line

One of the most effective ways to ensure your company produces a steady supply of innovation is by adopting cloud computing. Indeed, cloud providers take on the cost of maintaining hardware, security controls, patching servers, and offering levels of operational controls greater than typical corporate data centers can achieve. But, because of their own competitive business models, they must continually innovate themselves to provide customers with the most advanced technology.

In the old model of on-premises computing, upgrades meant replicating customized code—requiring untold months to achieve and millions of dollars in opportunity cost. Branch offices and remote locations were often stuck with the previous model year, creating yet more work to homogenize reports.

In the cloud world, customers get hundreds of new features every quarter throughout their organization simultaneously and seamlessly at no extra cost.

Challenging your senior leadership team about their cloud strategies demonstrates to shareholders that you are committed to stronger growth, in a shorter timeframe, than even they may have expected.

Originally Posted on Linked IN by: Mark V. Hurd

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Posted on August 19, 2016, in Uncategorized. Bookmark the permalink. Leave a comment.

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