One of the fascinating competitions in today’s business world is the one between the digital disruptors—companies whose business vision is rooted in technology and driven by the cloud—and the so-called incumbents.
One sector where this competition is particularly intense is financial services. In this sector, the digital-first companies typically don’t compete with banks and other financial institutions directly. Instead, they target specific functions based on a clear—and often data-driven—understanding of what customers want. This strategy has proven particularly successful with millennials. For example, until recently the norm for giving money to a friend or family member was to write a check. Now, almost two-thirds of 20- and 30-year-olds use payment apps, such as Venmo.
In healthcare, a different pattern is emerging, one where digital-first giants either buy or innovate their way into the sector. Examples include Amazon’s billion-dollar acquisition of the online pharmacy PillPack and the new Apple Watch, which is capable of taking electrocardiograms.
Whatever the sector, digital disruptors have one characteristic in common. They leverage the capabilities of the cloud to the maximum extent possible. A shift in power toward digital-first companies is underway, and the cloud plays a major role in helping these companies establish themselves.
Many incumbents are just now taking their first steps on the journey to the cloud, and still working on the challenges involved in migrating their existing legacy applications to more scalable and agile public cloud environments. While they’re engaged in this process, digital insurgents are already exploiting the full potential of the cloud to deliver solutions that meet emerging customer needs associated with today’s evolving lifestyles.
In highly regulated industries, such as financial services and healthcare, major brands will not necessarily see an immediate decline in their customer base, nor profits. Nonetheless, digital-first companies are capturing millions of customers annually, and this growth poses a considerable challenge over time. Embracing the journey to public cloud is crucial for legacy enterprises.
The most successful cloud-based disruptors use experimental sandboxes as a critical component of development. The public cloud can drive progress toward almost any business goal involving IT—operational transformation, new market penetration, new product launches, automation.
Digital transformation to the public cloud is also the only way companies can leverage storage scalability and the essential innovations of the open-source community. There are still lingering concerns among executives in highly regulated, data-sensitive industries concerning privacy and regulatory compliance, and these can lead to hesitation. The face is, public clouds have been in place for over two decades now, and their security is often superior to older on-premise security. Incumbents can, therefore, tap into the public cloud to ensure safety for mission critical workloads.
To accelerate the transition to the public cloud, consider the following best practices.
Learning to Fail Fast and Learn from Experience More Quickly
The Silicon Valley maxim to fail fast may run counter to incumbent corporate culture, but it is the best path to success in the new digital reality. The key is being able to learn from failures quickly and adjust accordingly.
Partnering for Progress
A digital native approach to business is often lacking in the corporate culture of incumbents. Cloud partners that have a digital disruption in their DNA can play an important role in driving cultural renewal at every level of the organization. A reliable cloud service partnership can accelerate concepts, pilots, staffing and other mechanisms designed to deliver value quickly and securely.
Re-Examining Compliance Processes
Operations should be streamlined to transform enterprise IT to be well-suited for the cloud. Companies can apply artificial intelligence to supplement human intervention, and encourage cloud adoption among employees. First, building a solid foundation, then working your way up, enables businesses to make important changes that transform the enterprise into an environment that is compliant by design.
Successfully competing with digital natives means using the cloud to find new opportunities to streamline and better comprehend customer needs and behaviors. It also means being unafraid to change time-honored business practices. At the same time, in highly regulated and data-sensitive industries, compliance and security must be prioritized. Cloud transformation has quickly become vital for companies in all sectors and represents an essential foundation for future business success.
