Should You Move Your Business to the Cloud?
Lower business risks & lead the way to long-term profitability
Let’s talk about the only risk you want to hear about: The Risk of Success. Is that an oxymoron? Hardly. It’s normal for every business to have the occasional sharp spike in web traffic or orders, or a doubling of revenue in one quarter versus another. Some companies are equipped to handle this kind of anomaly. But what if it happens regularly, or dramatically? What if your new application takes the market by storm, or you suddenly have more business units to manage as the result of a merger or acquisition? It stretches your existing infrastructure to capacity, and things break faster than they fix. At that point, it becomes a gamble. How long can I keep winning without losing?
Truth is, you can’t keep winning on a gamble. That’s why it’s called a gamble, loss is inevitable. Know when to get out and set up a long-term system to continue your profit stream without the risk of loss.
I speak to many companies about this because I’m curious how they mitigate the risk involved. Many of them choose to go “partly cloudy,” that is to say, put some of their infrastructure in the cloud, and keep the balance on-premise—until a full cloud setup becomes feasible. Can you have a two-tier architecture strategy and still be successful? Absolutely. But it depends how it’s done.
For mid-size to large organizations integrating their systems in the cloud, it isn’t immediately clear how the cloud can work for them. They may have invested generations of family blood, sweat, and tears into building a strong ecosystem, and are doing just fine. But things have changed. Now, how will the cloud help them beat the competition, competition who might have faster systems and are more nimble and responsive to customer demands? How can monolithic infrastructure be made to react to a fast-changing market?
Today’s definition of nimble isn’t only outward-facing, or delivering business in record time. It’s also inward-facing; being efficient with the tools in place to keep operating budgets trim.
Say a company is opening a small business unit in another country, or wants to market a new, disruptive product that runs independently of the mothership. Possible reasons? Maybe the legacy system that’s running at headquarters is too big to deploy to a remote location, but a local deployment of a cloud platform would make more sense. The risk would be lower, and if the product failed, the company would lose thousands instead of hundreds of thousands of dollars.
So, using these initiatives as drivers, the company gradually hacks away at the monolithic block of legacy systems and tools. Next, they might tackle email or the CRM. Moving elements to the cloud one piece at a time is one way that many companies achieve nimbleness in a way that isn’t intimidating.
In previous articles, I’ve talked about what happens when a company builds an ad hoc, unregulated application as a quick fix to respond to an urgent need. Hello, rogue application! I don’t recommend that you let a rogue application run amok in your company. On the contrary, a scalable stack acts as a kind of “reform school” for these rogues, helping to transform them into “good guys.” The reality is, if you don’t provide the tools (or a platform), well-intentioned employees will use whatever is at hand.
Thankfully, there is a way of bringing these rogue applications back into the ecosystem, under the control of the Information Systems department: Connect them to a platform that can be used across the organization, and make sure it’s the right platform. It’s the responsibility of the IS department to provide a platform and standards for all to abide by.
This is a way of achieving centralization even when someone other than IS creates an application. Sometimes IS will need different interconnecting platforms to do this.
Chris Thierry, my friend and Chief Energizing Officer of Cimpl, a company that has earned its spot as a top cloud platform contender, speaks to yet other reasons a company may go partly cloudy.
“Data that is considered private in one country may be open to more scrutiny in another country. Where does the data reside and who can access it? Any discussion about data sovereignty requires a sizeable budget for legal fees, as legal clearance may be required from each country a company does business in. The platform approach is crucial for multinational companies because it empowers them to bolt in solutions designed to solve regional problems.”
Of course, you might face some resistance. That resistance revolves mostly around security and control. Let’s not forget that IS is in charge of making sure that governance and compliance policies are respected. Who will have access to the application? What data will be exchanged? It is critical that IS gets involved in the two-tier strategy from the start.
They might also have concerns about massive change happening all at once. But at the core of the two-tier strategy is the idea that you don’t have to innovate on all layers at once; it’s just not possible because change happens at different speeds in each layer.
When you add cloud integration one piece at a time, you can have the pleasure of watching it grow, from read-only to bi-directional, from patchy to awesome.
So stay nimble, and scale at your own pace.
To read more about this, get your copy of Martin McNicoll’s book, Scale Up Your Business with Cloud Technology: A Practical Guide to Building a Future-Proof Enterprise, with a Foreword by Verne Harnish. www.martinmcnicoll.guru