So how do you go from a company with an idea, or an already successful company developing new ideas, to using cloud to hone your product and grow your business?
For such a profound question, there is a surprisingly simple answer.
To get slightly metaphorical, it all starts with a grain of rice on the first square of a 64 square checker board. With each square, the amount of rice doubles. By the time you get to the 64th square, you have a mountain of rice.
This is what cloud provides. Cloud is an exponential proposition for how a business can push forward innovation. Instead of growing in trickles of 1 or 2 customers at a time, companies that have successful products and functional business models that can be transitioned to a SaaS mode can access new customers like never before.
SAP, for example, is currently championing this approach in moving all their product suites into the cloud. Because the sheer scale of cloud is infinite, a business is able to not just bring on new customers 1 and 2 at a time; they are able to double the resource loads against increased demand with every iteration of a client onboarding. This is where you begin to see the real value of cloud to a company, in terms of what capabilities they can provide without increasing IT staff.
There’s no physical infrastructure for you staff to manage.
To be a successful company running in the cloud, businesses need to combine good processes with good technology and great talent. When you have all three of these components, the potential of a given company is limitless. One group that’s managing 10 virtual machines (VMs), with the same talent, process and technologies, can equally manage 10k VMs without increasing staff size. This is a powerful change cloud has enabled, and it’s a value the enterprise has never been able to realize.
Typically there are very strong equations that govern IT organizations.
With every hundred servers a company adds, an additional 10 staff members need to be brought on to manage those new resources. This causes IT budgets to balloon in a way that every company would rather have happen to customer acquisition numbers. Cloud enables business leaders to separate the dollars in revenue from the dollars in IT staff. And that’s what the transitioning into a successful business mode means: being able to increase product capacity without increasing spend dramatically.
Yes, there is increased spend in the cloud as a company scales up, and yes it does track linearly. But that change is tracked linearly to dollars in revenue not to staff and IT, numbers of servers, etc. So it comes down to process, people and technology.
So what does cloud let your team focus on?
Instead of focusing on adding more staff to manage more servers, your team can develop new features. You can utilize the staff you already have to do more. They aren’t concerned with how the infrastructure is going to scale anymore – that’s a solved problem with an outsourced cloud provider. Now they have to worry about how to increase how features positively impact and application. Businesses utilizing outsourced clouds can use their staff in a much more agile way to react to market demand.
Cloud is also elastic, so in slow months you can scale down. Traditionally, you would have bought the extra hundred servers to handle demand in the earlier months. But come a slow moment, it wouldn’t be feasible to fire the staff and decommission the servers just to save those costs. With the cloud, this is no longer an issue. When demand goes down, you shrink the size of your cloud and your costs for a down month are less. Revenue is really tied in a one-to-one way with your spend. It’s a direct correlation and that’s something that hasn’t existed before.
By Jake Gardner