Cloud Computing: No Longer Experimental Technology, but a Tool for Innovation

Thursday, August 16th, 2012 10:13:14 by

by Adnan Siddiqui, Territory Manager, IBM Pakistan

Most companies today recognize that cloud computing is a technology game changer.

But a growing number are also beginning to see how powerfully the cloud can propel business innovation, according to a recent survey of global executives conducted by IBM and the Economist Intelligence Unit, “The Power of Cloud: Driving Business Model Innovation.”

Increasingly, leading-edge companies are turning to cloud computing to shift the competitive stakes in their favor. They’re crafting new ways of weaving cloud computing throughout their organizations to transform internal operations, re-imagine product and service development, and reshape customer relations.

The cloud’s acceptance is cemented within IT circles. Nearly half of all respondents of another recent IBM survey of CIOs say they evaluate cloud options first over traditional IT approaches when it comes to making new tech investments. And it’s not just large companies that are moving to the cloud. Around 67% of the smaller companies surveyed have also adopted it.

Yet, as mainstream as the cloud has become, most companies still consider it a priority for their IT departments, not for their overall business. Only 16% of the executives surveyed use the cloud for broad innovation, such as entering new lines of business or industries or reshaping an existing industry.

The cloud, though, opens up new opportunities to wring more out of all the data that businesses can collect today about their operations and their customers and to truly take advantage of the proliferation of mobile computing. Because the cloud provides a flexible, cost-effective way to roll out business and customer analytics programs, it provides broader access to applications and data to partners and customers.

The key is using the basic attributes of cloud computing not simply to tackle technology challenges, but fundamental business issues as well. Positive aspects of cloud computing include the following:

–Flexible costs: Shifting hardware and software costs from a fixed to a pay-as-you-go cost structure turns capital expenses into operational expenses, giving companies access to tools and computing power that may have been too expensive or time consuming to roll out in the past. When it comes to rethinking business processes, companies are using cloud-based capabilities to analyze customer data in a more cost-effective way and to provide more personalized marketing campaigns and products and services.

–Ability to adapt to new markets: The ability to respond to rapidly changing customer needs is a key competitive differentiator today. A third of the executives surveyed believe the cloud can help with this. By helping businesses rapidly adapt processes, products, and services to meet the changing needs of the market, the cloud can enable faster prototyping and innovation and speed up how quickly companies can get new offerings in front of customers.

–Connections to ecosystems: Cloud computing is custom-made for helping organizations spur connectivity between customers, partners, and employees. Cloud-based platforms can bring together far-flung, broad groups of people who can collaborate and share resources, information and processes. The cloud makes it easier for companies to collaborate with partners and customers, spurring productivity and innovation.

In just a few years, cloud computing has gone from being an experimental technology to one that’s essential to many companies. But in reality, companies have only just begun to grasp the true benefits of the cloud. The ones that understand how profoundly the cloud can shape how business gets done are well on the way to getting a jump on competitors and transforming their industries.

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