The last decade witnessed one of, if not the most transformational waves of technological change ever to break on the shores of IT – cloud computing. Companies vied to position as the key holders to the cloud universe, and customers too, competed for the honor of being first to market in terms of their use and migration to the various cloud models.
The first phase of cloud was characterised by migration of business to the cloud. This phase is still happening, with many companies of all shapes and sizes at varying stages along the migration path.
The initial catalyst for cloud adoption was, broadly speaking, cost and efficiency based. Amidst times of global economic fluctuations and downturn during the ‘mid-noughties’ the cloud model of IT promised considerable IT efficiencies and thus, cost savings. For the early migrators however, cloud has moved beyond simple cost efficiencies to the next phase of maturity: competitive advantage.
IDC reported earlier in the year that 80% of cloud applications in the future will be data-intensive; therefore, industry know-how and data are the true benefits of the cloud.
The brokerage of valuable data, (be it a clients’ own proprietary information about inventory or customer behavior, or wider industry data), and the delivery of this critical information as a service is where the competitive advantage can be truly found – it’s almost now a case of ‘Innovation as a Service’.
The changing modus operandi of cloud has largely been driven by the increasing, types, variety and volumes of streams of data businesses now require to stay competitive, and now the roll out of cognitive and analytics capabilities within cloud environments are as important to achieving business goals and competitive advantage, as the actual cloud structure itself.
There’s almost no better example of this, than the symbiotic relationship between Weather.com and its use of the cloud. For a company like Weather.com the need to extract maximum value from global weather data, was paramount to producing accurate forecasting pictures, but also by using advanced analytics, the management of its data globally.
Through IoT deployments and cloud computing Weather.com collects data from more than 100,000 weather sensors, aircraft and drones, millions of Smartphones, buildings and even moving vehicles. The forecasting system itself ingests and processes data from thousands of sources, resulting in approximately 2.2 billion unique forecast points worldwide, geared to deliver over 26 billion forecasts a day.
By integrating real-time weather insights, Weather.com has been able to improve operational performance and decision-making. However, by shifting its (hugely data-intensive), services to the cloud and integrating it with advance analytics, it was not only able to deliver billions of highly accurate forecasts, it was also able to derive added value from this previously unavailable resource, and creating new value ad services and revenue streams.
Another great example is Shop Direct: as one of the UK’s largest online retailers, delivering more than 48 million products a year and welcoming over a million daily visitors across a variety of online and mobile platforms, the move to a hybrid cloud model increased flexibility and meant it was able to more quickly respond to changes in demand as it continues to grow.
With a number of digital department stores including £800m flagship brand, Very.co.uk, the cloud underpins the a variety of analytics, mobile, social and security offerings that enable Shop Direct to improve its customers’ online shopping experience while empowering its workforce to collaborate more easily too.
Smart use of cloud has allowed Shop Direct to continue building a preeminent position in the digital and mobile world, and it has been able to innovate and be being better prepared to tackle challenges such as high site traffic around the Black Friday and the Christmas period.
In the non-conformist, shifting and disruptive landscape of today’s businesses, innovation is the only surety of maintaining a preeminent position and setting a company apart from its competitors – as such, the place of the cloud as the market place for this innovation is insured.
Developments in big data, analytics and IoT highlight the pivotal importance of cloud environments as enablers of innovation, while cognitive capabilities like Watson (in conjunction with analytics engines), add informed intelligence to business processes, applications and customer touch points along every step of the business journey.
While many companies recognise that migration to the cloud is now a necessity, it is more important to be aware that the true, long-term business value can only be derived from what you actually operate in the cloud, and this is the true challenge for businesses and their IT departments as we look towards 2016 and beyond.
Written by Sebastian Krause, VP IBM Cloud Europe