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Why Cloud is the Future for Digital Transformation

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PCQ Bureau
New Update
Digital transformation

When it comes to today's digital economy, enterprises are becoming increasingly relianton leveraging the power of technology not for just supporting ongoing business processes, but also for driving newer sources of competitive differentiation. In fact, for a lot of enterprises, their success or failure is directly dependent upon how effective their IT service delivery environment is.

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The arrival of the internet followed by the mobile revolution and now the big data explosion means that companies must start dedicating more and more to IT resources and staff for the creation, and continued development of systems of insight and action that enhance the consumer experience.

When you talk about the foundation for this new agile business world, the cloud is a fundamental block of agile application development. Cloud-based infrastructure holds the key to the delivery of flexible, on-demand access to resources that are underpinning any new digital business offerings.

The Role of Cloud in Digital Transformation:

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Vineet Tyagi, Global CTO, Biz2X Vineet Tyagi, Global CTO, Biz2X

Digital transformation is now imperative for all businesses, be it smallor big. While it may look different for every company, in general terms, it can be defined as the integration of digital technology into all areas of a business, that results in fundamental changes to how businesses operate and deliver value to their customers.

Cloud computing as mentioned earlier is the foundation of the technologies that can enable digital transformation. Cloud is capable of exploring the possibility, speed as well as the ability for experimentation with reduced risk that can help make a transformation journey successful.

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As we continue to move forward towards an increasingly digital world, more and more organisations are now undertaking digital transformation, to adapt to a changing market. In fact, by the end of 2019, almost 70% of companies across the globe were looking at digital transformation strategies, which encompassed 40% of their tech spending.And, this spending on digital transformation (DX) is projected to reach 1.78 trillion U.S. dollars by the end of 2022.

This monumental shift has of course been accelerated further by the COVID-19 pandemic, which has indiscriminately strong-armed industries into implementing all kinds of digital methods for business continuation. Statistics say that before the pandemic, almost 90% of all companies were looking at embracing some kind of public or a hybrid cloud strategy, even though only a small minority had mastered systems resilience with the shift. Once the pandemic hit, moving to the cloud became a mandate instead of an inspiration to maintain flexibility and resilience.

Digital transformation now involves the implementation of the best apps, devices, storage and has enabled businesses in changing their processes to engage their customers more thoroughly.

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The aforementioned changes are almost impossible to achieve without cloud and digital transformation services. This means that their integration is the only way that today, remote workers can stay on the same page and large projects can reach completion, without the need for in-person IT support and provide accessibility with data security.

Cloud –Accelerating Digital Transformation

• Single point of responsibility – Todays IT infrastructure has become extremely complex, especially for highly sensitive industries like Finanancial Services. It is driven by the dual needs of extreme confidentiality and high availability. Thus it is always a tug of war between completely closed to completely open and to add to this, different applications fall in different buckets across these two extremes. It has become imperative to simplify this complex landscape through having a single point of responsibility to reduce maintaining an army of employees to manage these complexities.

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• Cost: Typically, the clouddoes not entail any upfront costs, in fact, you can make regular payments which makes it an operating expense. Even though the monthly costs accumulate over time, the maintenance and support services are generally included which removes the need for annual contracts as opposed to a large capital expenditure that is needed for on-premises systems.

• Time: On-premises implementations end up taking longer owing to the time that is needed for installations on servers and individual computers. Cloud on the other hand offers quicker deployment and can be ready to use in a matter of hours/days.

• Business Agility: While traditional on-premises deployment requires complex code-level customization processes with little to no automation, the cloud offers self-service for reporting, analytics, configuration and access, thus promoting business agility. This capability can be tied to market acceleration for revenue growth as well as cost-saving initiatives.

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• User Productivity: A lot of SaaS applications have easy-to-follow user interfaces and delivery from location, data and the end-user. Cloud is usually characterized by ease of use, performance, and accessibility which helps in yielding higher activity. On the other hand, when it comes to on-premises management there are a few larger enterprises that try to mimic the cloud experience with the help of workspace applications that include single sign-on and access to a unified set of applications. However, the proximity between the user and the data center can end up impacting the latency and the need to access via VPN ends up limiting usability.

• User Onboarding: On-premises solutions may end up necessitating IT’s involvement in the onboarding process which can further cause delays. It is no doubt that the time to onboard a new customer has now become a critical factor for better customer retention - many cloud applications, put this activity in the hands of the business users, as well as setting up user IDs and passwords.

• Reliability: While SaaS providers are bound by audits and measures that can ensure up to 99.99% uptime, on-premises solutions might end up requiring the IT teams to architect solutions that are all successful. Having said that, it is quite rare to see on-premises offering the same up time as the cloud. The drawback of this is that downtime can end up impacting revenue, user productivity and comes with an IT cost.

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• Scalability: For on-premises management, scalability generally involves provisioning more hardware, along with the need to acquire additional licensing which means that it is IT and procurement heavy. On the other hand for the cloud, scalability often just means adding more user combinations and ensuring bandwidth.

Supporting digital transformation through the cloud provides access to robust third-party networking, storage; doubt the need for purchasing physical infrastructure which becomes incredibly useful for companies that possess low computing power, funds or technological support. Having said that, however, the cloud's capabilities of digital transformation provide computing power to create more digital transformation initiatives across a scale of industries from small to large enterprises.

The bottom line is that cloud-powered digital transformation enables businesses in collaborating, analyzing and developing applications without the prohibitive need for physical infrastructure. With a simplified interface and faster data, the cloud has now become a new source of competitive advantage, with digital transformation enabling agile teams to work in new, more collaborative ways that ultimately drive value.

Author: Vineet Tyagi, Global CTO, Biz2X

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