Cloud was originally conceived of to virtualize network, storage, and compute in a generalized sense. Subsequent innovations have added services to the cloud portfolio in terms of broad applicability without regard for the nuances, concentration and domain needs of specific industries and sectors.
Business leaders are always looking for new ways to drive growth and competitively differentiate their businesses, which often means pursuing significant new technology and innovation investments. An emerging industry cloud construct should be a front and center consideration.
The industry cloud market is rapidly evolving. It’s currently broadly defined as cloud-based platforms, products or services designed in a pre-configured manner to provide industry-specific capabilities. The reason to leverage industry clouds is straightforward — they provide differentiated, efficient, and resilient innovation with rapid time to market and business results. Business and technology leaders alike, at large, medium, or small businesses, should be considering industry cloud — and its potential impact — as their next investment.
Since cloud technology was first introduced in the 2000s, industries have leveraged it across elements like security, data analysis, customer experience and more. Yet now companies have found they need even more specialized services within their industries to unlock the potential impact and value of cloud. For instance, banks must adhere to extensive regulations and science laboratories must analyze unique data. Accelerating, optimizing, and innovating in this specialized space is the next challenge for CIOs.
That’s where industry cloud shines. As CIOs think about the needs of their organizations, industry cloud is emerging as the leading lever to more rapidly unlock business value. CIOs can use the technology to address the subtle, yet powerful set of requirements of their specific business, no matter the industry. But as CIOs evaluate industry cloud, it’s important to understand what it takes to implement the capability and supporting technology, how to think about industry cloud, and what four key steps to take before implementing the technology.
Why We Need to Think About Industry Cloud as Horizontal
Part of an organization’s differentiation comes from the ability to connect key business applications, model systems, and technology providers in a common, consistent, resilient, and scalable way.
Each aspect brings unique value to the company, culminating in a certain set of capabilities for the business. Industry cloud allows the business to capitalize on this unique combination by providing the business perspective and technology to enable and sustain it. While industry cloud is used by many different industries, we see it as horizontal technology because it’s used in an end-to-end fashion across the entire business.
Let us illustrate with an example. A bank will seek payment processing, customer relationship management, and client onboarding solutions from three different providers that are experts in their domain. These providers do not have infrastructure or aligned business processes built in to interact collectively on the client’s behalf, but they all help the business improve its operations. With an industry cloud, the bank would be able to rapidly architect and stitch together the data, technology, and processes from these three providers to unify operations and consolidate visibility.
A horizontal technology industry cloud creates a continuum of technology, people, and processes that delivers end-to-end business journeys, allowing the organization to address specific domains in their market. How the industry cloud is delivered commercially and how rapidly it can improve time to market depends on the industry cloud provider as well as the maturity of each company to implement it.
What It Takes to Implement Industry Cloud: The Entire C-Suite
CIOs are now responsible for providing a unique business perspective and supporting technology that is best suited to the organization’s needs, but they cannot fully understand these needs without first soliciting the perspective of and working with the entire C-suite.
Cloud, industry cloud, or otherwise, is now the purview of the entire C-suite. Three out of four executives noted that they have decision-making responsibility or ownership across all aspects of their company’s cloud transformation in PwC’s Cloud Business Survey.
To maximize the efficiency of the business with cloud, every C-suite member needs to take part. This is especially true for industry clouds. Most businesses operate relatively under the 70/30 rule: Approximately 70% of business operations are commoditized and 30% drives competitive differentiation. Industry cloud can unlock value across both aspects, but it shines within the differentiation and innovation in that 30%. Without the full C-suite’s buy-in and collaboration on industry clouds, companies will fall behind in that differentiation and down the line, in their market share.
How to Best Implement Industry Cloud
To maximize the benefits of industry cloud and ensure smooth implementation, there are a few key steps that must be taken.
- Build consensus among stakeholders: Ensure that everyone in the C-suite is accepting and understanding of industry cloud as a transformation strategy. This makes an organization more cohesive and united, and ultimately more likely to deliver on goals.
- Evaluate your cloud maturity: Examine the extent of your cloud footprint, including the percentage of your business that runs on the cloud. With these details, you can better understand the gaps industry cloud can fill.
- Determine the type of business you have and why you win: Consider your customers, your business model, your cost structure, and your competition and how you will outpace them in a sustainable way. Also consider factors like economic and geographic regulation, speed of innovation, and whether you’re in a public or private sector. This will impact how you use and leverage industry cloud.
- Coordinate with your partners: Consider whether the business is looking to form multi-partner arrangements. Many businesses can’t stay focused only on their own product suite. They need to accumulate and integrate products and materials from different relationships.
Implementing new technology is complex, but as ecosystems become increasingly robust it is a critical step in addressing an organization’s nuanced requirements. With a clear understanding of industry cloud, what it takes to implement it, and just four key steps, CIOs will be well positioned to bring industry cloud to their business.