There are businesses that have adopted cloud; then there are cloud-powered businesses. What’s the difference and why does it matter?
When only parts of an organization are operating on the cloud, only partial benefits can be realized. However, a cloud-powered business can be characterized by reinventing their business through cloud, experiencing fewer barriers to reach its value, and expect revenue growth of 15% or greater despite the current business environment. Most of all, a cloud-powered business is fully transformed through its use.
An Incomplete Cloud Approach
In PwC’s latest Cloud Business Survey, 78% of executives say most or all parts of the business are on the cloud. But more than half report they’ve not reached their intended outcomes. Part of the issue is that companies are taking a traditional, linear approach.
Going from workload migration to asset modernization to cloud native development doesn’t consider what problem you’re trying to solve or what results you want to achieve. It bypasses the business case in favor of sequential change.
Like with any technology, the cloud for cloud’s sake doesn’t work. Keeping data or legacy applications in-house or moving toward a managed services model may be the right path. Each organization needs to factor in risk, customers, talent, and other impacts to define their strategy.
It takes collaboration across the business to create a cloud-powered business. Each function uniquely benefits in their own way from the cloud. At the same time, they’re interdependent. This can also be said for the critical data they’re seeking to make better decisions.
All too often, functions and data remain siloed, which also means the data is untapped and ungoverned. Yet, companies must think about the specific, potential risks that the cloud poses throughout all stages if they want to take full advantage of it.
Characteristics of a Cloud-Powered Business
If companies that struggle to realize full business value from the cloud are on a horizontal, disparate journey, cloud-powered companies take a multi-faceted, collaborative approach.
We’re seeing this in about 10% of the companies we surveyed, which we consider cloud powered. These impressive results come from, for one, employing a method that applies the strongest business case for their goals. Cloud-powered companies are nearly four times as likely as other companies to sustain this type of strategic focus.
It goes hand in hand with an understanding that data is at the heart of transformation efforts. Cloud-powered companies are much more likely to have an enterprise-wide data strategy than other companies (88% versus 59%).
From streamlining architecture and modernizing their data into an integrated view to creating governance structures and concentrating on building the skills and operational changes, they do what it takes to become a data-driven organization.
CIO and the C-suite for Success
Perhaps one of the most important characteristics of a cloud-powered business is strong relationships, both across functions and the C-suite. For one, they sync with key business functions at the earliest stages of planning — more than five functional teams are involved at the start of cloud transformation projects, according to our survey.
Regarding the C-suite, CIOs at cloud-powered companies have stronger alliances. When asked, how would you best describe your relationship with the following executive, specifically in relation to achieving your cloud transformation goal, 87% and 85% respectively say they have “strong working relationships/consider them an ally” with the CISO and CDO and CEO and COO.
Cloud-powered companies also prioritize collaboration with the CHRO and talent teams to make sure they acquire or develop the critical skills needed to make the most of cloud investments.
Becoming a Cloud-Powered Business
All (100%) of the cloud-powered companies we surveyed have improved decision making through cloud transformation; 97% have improved productivity; 94% increased agility and cyber posture; and 93% have become more resilient. These are just the top five benefits of cloud, and all are imperative to surviving in today’s business environment.
These capabilities are also foundations for competitive differentiation, and we see emerging industry cloud solutions as the next frontier in this area. As pre-built offerings, they can be tailored to a sector’s unique business processes, regulatory requirements, and customer needs. They can move companies along faster by providing a more mature starting point for the latest technology, such as artificial intelligence.
From wrangling data and re-engineering processes to automating decisions and driving simulations, machine learning and AI help reduce costs, add intelligence, and get things done faster. Cloud-powered companies know they will need the right internal talent and external partners, especially in data science, to make this all happen responsibly.
In fact, designing trust into cloud projects must extend to all transformation initiatives — especially in emerging areas like the metaverse and web3. Even more important, ESG leaders are looking at cloud carbon emissions as well as how cloud solutions can help drive data collection and reporting in support of net-zero goals.
Whether you’re well on the way, or one of the many organizations who have moved the cloud piecemeal, follow the practices of leading companies and build the value-creating cloud practices that apply to your organization, and you’ll soon become a cloud-powered business too.
