In the past few years, cloud computing has been perhaps the most exuberant technological innovation. It has seen the fastest adoption into the mainstream than any other technology in the domain. According to Gartner, the worldwide public cloud services market is forecast to grow 17% in 2020 to total $266.4 billion, up from $227.8 billion in 2019. Fueled by the increasing number of smartphones and mobile devices that can access the internet, cloud computing is revolutionizing organizations and businesses.
Changes in the Organizations due to Cloud Computing
Information travels rapidly in both directions with the cloud. Moreover, the cloud computing systems are far more flexible with attributes like virtualization, scaling up or down to handle bigger workloads, or automated security patching across thousands of machines. Cloud computing provides rapid data collection and analysis, followed by over the air changes to product software, which is the key to the new systems. The impacts of the cloud adoption include changing the way products are designed, closer collaboration between corporate IT department and other business units including sales, finance, and forecasting. It will lead to more customer interaction, even up to a point of jointly developing a product with consumers.
Moreover, new ways of writing and deploying software will encourage new types of faster-acting organizational designs. The best way to anticipate how these changes will occur is to hear from companies already implementing them. “It is already changing organizations, by moving IT from a cost center to something with a place at the table in a lot of different meetings,” said Chris Jackson, head of cloud platforms at Pearson, a global learning company.
Furthermore, public cloud computing offered by companies like Amazon Web Services, Microsoft Azure, and Google Cloud is still regarded as a cheaper and more efficient way for companies to store and process data. These lower costs have forced many companies to shut down their proprietary data centers and consume computational power and attendant software as a series of on-demand services. Meanwhile, other companies use cloud computing software in their own data center, as a means of working faster and increasing resources.
Impacts of Cloud Computing on Product Design and Customer Experience
As cloud technology improves, it is becoming easier for companies to create products and services within the cloud, or model new products or marketing campaigns as cloud-based software prototypes. The cloud is also a common repository for the collection and analysis of new data, and the place where an increasing number of artificial intelligence operations, like image and speech recognition are conducted. The proliferance of the cloud is evident, as startups increasingly conceive of their goods and services as software-centric entities, from which data is continually derived. For instance, a ride-hailing company Uber has stressed the importance of its hybrid cloud model to ensure constant uptime as well as individual relationship between product development and deployment. Uber manages to model a virtual fleet of taxis from private cars through a combination of mobile software, large scale data analysis, mapping, and social networking.
A similar dynamic of redefined processes and constant iteration is happening with industrial products. One recent project from Oden Technologies, a New York-based startup, involved building a tablet-based system for carrying out complex calculations in real-time. The product would have normally taken six months to a year to finish, however, it was finished in 10 weeks. The prominent reasons behind this were accelerated testing and direct communications with the customer about needs and specifications during design and construction. As a result, over time the initial design and the prototype incrementally became the product, with the customer participating in its creation. “The relationship with the customers tightens,” said James Maidment, the team leader of the project.
The other Essential Changes
A founding father of Silicon Valley, William Hewlett famously said, “You cannot manage what you cannot measure.” However, the opposite also holds true—what and how you measure something influences the way it is managed. A paper was recently published regarding the influence of modern technologies on productivity and management. In the paper, Eric Brynjolfsson, Daniel Rock, and Chad Syverson found that major technology improvements may lag productivity gains for years, even decades. This is a significant reason why an ecosystem of other changes has to arise, along with new thinking about the use of technology.
Brynjolfsson, a professor at MIT’s Sloan School of Management thinks that software-based advances like AI and cloud-style software will find a place faster than any of the earlier advances. The main reason being the low cost, which means these advances can be quickly adopted by startups free from legacy costs and practices. Moreover, unlike hardware-based advances, the influence this time will be from software. “With cloud, we can replicate processes more quickly, but you still need three things to be updated before you take the full advantage: Organizational innovation, trained human capital, and social institutions, like infrastructure and regulation that accommodate new technologies,” he added.
Rise of Cloud-native Organizations
According to Capgemini, only 15 percent of enterprise workloads run in cloud native ecosystems. However, with the promising potential of the cloud-native delivery model, the use of this approach is expected to increase significantly in the near future. The cloud-native software approaches emphasizes ease of use and low-impact alteration of components of any given software application. Massive applications are subdivided into a series of micro services that can be tweaked with little effect on a running piece of software.
The traditional complex software has a series of relationships, called dependencies, with other lines of codes, requiring big rewrites for even negligible changes. These dependencies can be potted by orchestrating micro services into highly portable units, called containers. With cloud-native approach, it is possible to deploy and manage an application globally, from a single location with relatively low hassle. The most commonly used open source software, Kubernetes is a resourceful tool that has made this possible by encouraging collaboration across the board. On this platform, the feedback is made faster. Furthermore, the fear of taking big projects no longer exists because the many processes taking place in a huge software project can be managed in a transparent way where issues get handled faster.
To conclude, management has experienced a major transformation with the application of cloud computing, which has ensured a lot of flexibility in the storage and processing of data as well as improving processes. Furthermore, the virtualization of computer server in the cloud allows more workloads for each machine. The work can be assigned in small portions and dispersed either to maximize resources or for security reasons. Thus, cloud computing possesses tremendous potential as far as business process management is concerned.
