Arguably, the first phase of cloud computing has been mainly about moving applications and their associated data into the cloud. Whether that involves merely invoking a software-as-a-service (SaaS) application or building a custom application that gets hosted on a public cloud, the business outcome is essentially the same. One way or another, the internal IT organization is getting out of the business of deploying and managing IT infrastructure.
That trend has been playing out to varying degrees for the past 10 years. What should be of paramount interest to IT service providers is what will happen in the next 10 years. Today what runs in the cloud is essentially a mirror image of applications that were once deployed on premise. Thanks to the rise of digital business initiatives coupled with advanced analytics, it’s only a matter of time before many of those applications start to converge.
The line between a customer relationship management (CRM) application and a supply chain application, for example, will increasingly blur as organizations seek to employ a more customer-centric approach to managing processes. Instead of having to piece together the state of the relationship with any given customer across multiple applications, most organizations will want to be able to instantly access a holistic view of that relationship as part of an effort to provide a superior customer experience.
Taking the next step in digital business transformation
A new global survey of 3,900 decision makers conducted by International Data Corp. (IDC) on behalf of SAP suggests even small to medium businesses (SMB) are fairly far down the digital transformation path thanks to their adoption of cloud applications. Midsize firms with 500 to 999 employees are more prone to take a long-term view. Close to half (46.5 percent) of the midsize firms said their active participation in the digital economy will be essential to the company’s survival in the next three to five years. Just over a third (38.2 percent) of small businesses with fewer than 100 employees concurred.
Therefore, adoption of cloud applications is only the first step in a digital business journey. Most of the organizations that adopt cloud applications today are simply hoping to standardize on a commonly used set of best practices. But as organizations of all sizes gain mastery of those application, the next step will inevitably involve greater integration. Eventually, the lines between those applications will, in many cases, blur to the point where they are indistinguishable.
Becoming a stratgic business partner
Naturally, IT service providers will need to adapt to the new reality. In fact, at the higher end of the enterprise substantial digital business transformation is already being made. The next wave of digital business transformation will soon occur across an SMB sector that has already aggressively adopted cloud applications to level the playing field against larger rivals.
IT services providers that are not prepared to help customers make that transition will increasingly find themselves left behind as organizations gravitate toward IT service providers that also serve as their digital business consultants. After all, technology advisors are now a dime a dozen. What’s priceless are strategic business partners that helps make an organization more competitive every digital business day.