Perspectives

Cloud computing in 2017

Private company issues and opportunities

Overview

New generations of cloud computing solutions are chipping away at one of the most persistent challenges for growth-minded companies: creating a high-quality customer experience. In addition to their role in powering front-office functions, cloud-based technologies are equipping growing numbers of organizations with fuel for back-office operations.1 In our most recent survey of technology trends in the middle market, 64 percent of respondents said they were mobilizing or had successfully deployed cloud-based, customer relationship management (CRM) solutions.

The growing ease of adoption of these solutions is a key reason behind this trend: our survey revealed that the rapid time-to-value cycle was the top reason companies chose cloud-based applications.2 As firms look for new ways to create connections to customers, expect private companies to continue to integrate customer-focused cloud solutions into their technology mix.

Issues

While cloud solutions are attractive to many organizations who are looking to shift labor-intensive software management concerns to outside vendors, there are nevertheless management considerations that do not entirely disappear. Companies should fully understand the terms and conditions present in their service agreements. Terms can vary after periods of introductory service. And companies that are investing in cloud solutions should also determine that their users receive effective preparation to apply the technology across the organization.

For companies that are exploring cloud-based solutions, “You need to understand the duration of the subscription, and also understand what the cost profile looks like long-term beyond the initial contract,” says Karl Rupilius, principal, Deloitte Consulting LLP. Cost was in fact the top-ranked challenge for mid-market companies in using cloud-based services, the Deloitte mid-market technology survey revealed.3

Security came in second, and the stakes are only getting higher. As companies steer additional functionalities to the cloud, layer solutions on top of one another, and extend cloud capabilities to customer-facing operations, executives should operate under clear guidelines and understand that those guidelines can change frequently, Rupilius says. Data security becomes an even trickier concept when companies have cloud-based systems and do business across borders.

“That’s when various departments across the organization need to be aligned,” Rupilius says. “That’s when the legal department and the tech department need to talk.”

Opportunities

Across a number of industries and a variety of business functions, cloud-based applications have become more accessible, scalable and powerful. Firms can now take advantage of cloud-based software to quickly map customer demand as it rises and falls. In other words, the cloud can create the type of flexible computing support that can be timed and billed according the business’s needs at a particular moment.4

Manufacturers, for instance, are using cloud platforms to get up-to-the-minute information on product performance that can eventually reduce equipment downtime.5 The flexibilities may even more pronounced when firms choose to run a combination of function-specific solutions on a cloud stack. Such an arrangement creates a layer of solutions working in concert to help power business operations, says Rupilius.

“Think about the old days: you had to install software on-premise, they would send you CDs or DVDs, then you would be responsible for managing it,” Rupilius says. “Now, you can sign up for cloud solutions that run entirely in a cloud stack. For small, mid-size, and large organizations, it helps them to be very nimble. It enables them to scale much faster and flexibly than ever before.”

Questions to consider

  • How can you leverage the cloud in order to grow and scale efficiently?
  • What sorts of cloud-based apps do you need to have in place to provide a high-quality customer experience?
  • How can you be nimble while running your IT infrastructure with lower IT operational costs?

Visit the Private company issues and opportunities homepage to view a list of additional topics.

References

1 “Customer Relationship Management (CRM): What businesses need to know,” ITProPortal, October 7, 2016, http://www.itproportal.com/2015/12/04/customer-relationship-management-crm-what-businesses-need-to-know-update/.

2 Appendix, “Technology in the mid-market—Taking ownership,” Deloitte, August 2016, https://www2.deloitte.com/content/dam/Deloitte/us/Documents/Deloitte%20Growth%20Enterprises/us-dges-tech-survey-report-appendix.pdf.

3 “Appendix, “Technology in the mid-market—Taking ownership,” Deloitte, August 2016, https://www2.deloitte.com/content/dam/Deloitte/us/Documents/Deloitte%20Growth%20Enterprises/us-dges-tech-survey-report-appendix.pdf.


4 “13 ways the cloud has changed (since last you looked),” InfoWorld, February 8, 2016, http://www.infoworld.com/article/3030138/cloud-computing/13-ways-the-cloud-has-changed-since-last-you-looked.html.

5 “Industry 4.0 engages customers,” Deloitte University Press, December 15, 2016, https://dupress.deloitte.com/dup-us-en/focus/industry-4-0/customer-engagement-strategies-digital-manufacturing-enterprise.html.

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