THE POWER OF CLOUD

How Cloud En­ables En­ter­prise In­no­va­tion

Arabnet - The Quarterly - - Front Page - By An­thony But­ler | @abut­ler

Cloud has made it eas­ier for en­trepreneurs to in­no­vate dig­i­tally; armed with a credit card and an idea, they can rent re­sources and can source even very ad­vanced ca­pa­bil­i­ties – such as cog­ni­tive com­put­ing – from the same cloud. By re­mov­ing bar­ri­ers to en­try, cloud has en­abled a Cam­brian Ex­plo­sion of star­tups. We can see this in our own re­gion where there are emer­gent startup ecosys­tems ap­pear­ing in many cities, en­abled—in large part—by cloud.

Whilst ben­e­fit­ing star­tups, these shifts si­mul­ta­ne­ously pose a threat and op­por­tu­nity to en­ter­prises. New en­trants are dis­rupt­ing in­cum­bents and tak­ing shares from ex­ist­ing mar­ket play­ers by de­liv­er­ing ser­vices and ex­pe­ri­ences on users’ own terms, and they are lever­ag­ing new tech­nolo­gies, de­liv­ered from the cloud, to do this. How­ever, en­ter­prises can also take ad­van­tage of the same tech­nolo­gies to dis­rupt, in­no­vate, and take shares from their com­peti­tors. Cloud has made in­no­va­tion the ba­sis on which com­pa­nies of all sizes now com­pete.

The bank­ing in­dus­try is one of sev­eral in­dus­tries that have found them­selves as­sailed by new en­trants of­fer­ing in­no­va­tive ap­proaches to ser­vices, such as pay­ments or lend­ing. Much of this has hap­pened by tak­ing the bank’s ser­vices and un­bundling them into “apps.” As

Heather Cox, Chief Mar­ket­ing Of­fi­cer at Citi, noted at IBM’S In­ter­con­nect con­fer­ence this year, peo­ple need bank­ing but they don’t nec­es­sar­ily need banks.

This same pat­tern is repli­cated across in­dus­tries. For ex­am­ple, whereas peo­ple need telecom­mu­ni­ca­tion ser­vices, they don’t nec­es­sar­ily need tel­cos. And as Uber is de­mon­strat­ing glob­ally, we may need trans­porta­tion ser­vices but do we re­ally need taxi com­pa­nies?

Rather than face death by a thou­sand dig­i­tal cuts, en­ter­prises have an op­por­tu­nity to trans­form. It is a fal­lacy to as­sume that en­ter­prises are des­tined to al­ways be dis­ad­van­taged when com­pet­ing with nim­ble star­tups that are un­en­cum­bered by or­ga­ni­za­tional com­plex­ity and tech­ni­cal debt. On the con­trary, en­ter­prises have tremen­dous amounts of data, ap­pli­ca­tions, and ser­vices that, although hid­den be­hind the fire­wall, rep­re­sent un­tapped op­por­tu­nity. They should look to un­lock this value and, lever­ag­ing mo­bile, an­a­lyt­ics, and cloud, de­liver it to end users in a way that is en­gag­ing.

By do­ing so, they can cap­ture new mar­kets and main­tain their foothold in ex­ist­ing ones. They must fo­cus sin­gu­larly on de­liv­er­ing value and ex­pe­ri­ences on their users’ terms; they must fo­cus only on what de­liv­ers dif­fer­en­ti­a­tion.

With much of this value de­liv­ered via apps, de­vel­op­ers play a fun­da­men­tal role in how en­ter­prises trans­form and ad­dress these new op­por­tu­ni­ties. Just as they need to un­leash their data and ap­pli­ca­tions, en­ter­prises must un­leash the in­no­va­tive power of their tech­ni­cal com­mu­nity. This means giv­ing de­vel­op­ers more tech­ni­cal free­dom; some­thing that can be anath­ema to the cul­ture in many cor­po­rate IT en­vi­ron­ments but crit­i­cal if en­ter­prises want to com­pete in this new world.

It also means rec­og­niz­ing that if an en­ter­prise just looks to the de­vel­op­ers sit­ting be­hind their own walls, they are miss­ing out; in­stead, en­ter­prises need to look at how they can mar­shal the cre­ative en­er­gies and tal­ents of ex­ter­nal devel­oper com­mu­ni­ties. This is es­pe­cially true in the Mid­dle East where we see youth­ful tech savvy pop­u­la­tions de­vel­op­ing nascent startup ecosys­tems in cities such as Riyadh, Cairo, Amman, and Beirut.

En­ter­prises can do this by mak­ing their data, ap­pli­ca­tions, and ser­vices avail­able to the public as APIS and run­ning ini­tia­tives to pro­mote use of these APIS to cre­ate new apps or in­cor­po­rate into ex­ist­ing ones. For ex­am­ple, Citi is work­ing with IBM to run a global com­pe­ti­tion, called Citi Mo­bile Chal­lenge, in which ex­ter­nal de­vel­op­ers com­pete to de­velop the most in­no­va­tive apps, lever­ag­ing Citi, IBM, and third party APIS. The best apps se­lected will move to pro­duc­tion. NASA is tak­ing a sim­i­lar ap­proach with the Vir­tual Space App Chal­lenge, which aims to cre­ate apps that con­trib­ute to space ex­plo­ration. Think of it as crowd­sourc­ing in­no­va­tion.

To do this, we be­lieve en­ter­prises need a plat­form for dig­i­tal in­no­va­tion. This plat­form, de­liv­ered from the cloud (Plat­form as a Ser­vice or Paas) pro­vides an en­vi­ron­ment wherein the devel­oper can just fo­cus on the code and the data, with ev­ery­thing else, such as run­times, data­bases, and sup­port­ing ser­vices, pro­vided by the cloud. Fo­cus on what dif­fer­en­ti­ates and rent the rest.

Speed is crit­i­cal: dig­i­tal com­pet­i­tive­ness is now a func­tion of how fast some­one can de­ploy code, mea­sure re­sults, learn from the mar­ket, and fac­tor into the next de­ploy­ment. Paas al­lows en­ter­prises to ac­cel­er­ate to the point where new apps can be de­ployed in sec­onds. This makes it pos­si­ble to de­liver new func­tion­al­ity – to ad­dress new mar­ket op­por­tu­ni­ties – more rapidly than in the world of tra­di­tional IT where re­lease cy­cles can take weeks or months.

In con­clu­sion, the right Paas gives en­ter­prises the op­por­tu­nity to start think­ing and act­ing like star­tups – at startup speed. It can help them in­no­vate to ad­dress new op­por­tu­ni­ties and new mar­kets and de­liver new value in new ways. De­vel­op­ers can rapidly test ideas, de­ploy code, and get feed­back to evolve. It can be game chang­ing.

The ben­e­fits be­come more pro­found when the plat­form is ex­tended to ex­ter­nal de­vel­op­ers; now, in­stead of fear­ing the lone devel­oper sit­ting in a cafe, en­ter­prises have the op­por­tu­nity to mar­shal this same cre­ativ­ity. The next dis­rup­tive app may still be born on this devel­oper’s lap­top. But, by pro­vid­ing this devel­oper with APIS, a plat­form, and an in­cen­tive, the en­ter­prise can shift from be­ing a pas­sive vic­tim of these dis­rup­tive forces to be­ing a ma­jor ben­e­fi­ciary of them.

“Cloud has made in­no­va­tion the ba­sis on which com­pa­nies of all sizes now com­pete.”

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