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The birth of cloud computing

Google has a deserving reputation for being an innovative company. Partly, that innovation comes from giving their people room to explore their passions on company time. That way, they get the best from their people.

Once such initiative is to offer employees in their R&D teams the opportunity to spend 20% of their time on projects that support their passion or interest topic. In the case of Christophe Bisciglia, who joined Google back in the early 2000’s, that interest was how to string together college campus servers that were being under-utilised into a joined-up processing platform. His logic was that most college servers weren’t being well used. Each server was allotted a few applications to service, and that meant some servers were facing costly upgrades, while others were barely registering any activity.

His ‘large-scale computing’ creation, later sponsored by IBM into a much bigger project, began the journey that ultimately led to what we know today as cloud computing. Bisciglia went on to be the founder and lead for Google’s Academic cloud computing initiative which provides Google hosted computational resources to facilitate education and research to universities around the world.

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What is Cloud Computing Really?

There are three parts to large-scale computing that are worth knowing about. Infrastructure-as-a-Service (IaaS) is the physical and operating systems infrastructure that underpins everything. Its responsibility is to manage the operating systems layer and hardware constraints such as memory, data storage, caching and processing power. Cloud IaaS has transformed the scalability and extensibility of applications, allowing companies like Facebook, Amazon and Uber to massively scale their businesses at a fraction of the cost previously possible.

IaaS has transformed the computing industry because its massively scaling potential makes concepts like Blockchain, Big Data and Internet of Things possible. It also allows entrepreneurs to innovate and scale their businesses faster; tapping into new markets at lower cost. This has created many market disruptions

Platform-as-a-Service (PaaS) is the next layer in the technology architecture. It is the applications ecosystem that manages the life-cycle of applications from birth through to death. It allows businesses to build tens, hundreds or thousands of applications framed on the same tech-stack, and allocate resources to them.

Modern PaaS platforms have transitioned the enterprise software industry towards an applications lifecycle that doesn’t require proprietary coding, scripting or integration. It breaks down the barriers between IT and the business. Examples of these Low-Code or No-Code applications include Mendix, BettyBlocks, Encanvas, ServiceNow, Appian and OutSystems.

Software-as-a-Service (SaaS) is the poster-boy of the cloud computing tech-stack. It’s the top layer that users and ‘normal people’ see. As the term suggests, SaaS applications turn apps into a service. It means companies like Salesforce.com can offer their Customer Relationship Management solutions as a single platform that can be shared to multiple customers (what cloud computer professionals call a ‘multi-tenant’ deployment model). SaaS vendors are able to focus on niche markets and rapidly scale these solutions to serve thousands of customers at a fraction of the cost they paid previously.

For buyers, the great thing about SaaS solutions is that you can try the solutions before you buy them, so you know what you’re paying for will be useful. Interestingly, SaaS is a double-edged sword for vendors. While it offers them the ability to scale their ideas into products faster and serve customers at very low cost, it does require them to source the investment needed to deliver a ready-to-use app BEFORE they launch.

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Why Should Cloud Computing Be Interesting to Any Entrepreneur?

Cloud computing isn’t merely a better tech-stack for business computing, it offers entrepreneurs the ability to turn ideas into saleable apps faster with its game-changing accessibility to markets, rapid scaling and growth economics.

Cloud computing means that niche markets can be sought out and served by relatively small startups and turned into billion dollar businesses. Examples include Evernote, Twitter, Snapchat, WhatsApp and Instagram.

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Final thoughts —Are you thinking enough about clouds?

Every business has the opportunity to leverage cloud computing to scale faster and target market niches more economically. It allows new digital innovations such as virtual reality, blockchain and big data to be harnessed to create disruptive solutions for markets previously unreachable to smaller enterprises.

Here are five things you could be doing with cloud computing. Use this list to qualify whether you’re fully exploiting cloud computing in your business.

1. Bringing More Value to Customers

Gone are the days that the only people able to access enterprise systems were employees. Every business today needs a cloud-based digital ecosystem to manage information management holistically, to serve all stakeholders. Amazon.com is the poster-boy example of an effective digital ecosystem. Customers use it to serve themselves and they don’t mind because the service is MORE convenient and timely. It means customers, suppliers, employees, etc. use the same common computing platform, and data is entered by the most relevant contributor (i.e. you don’t have people sitting back at Amazon.com HQ re-keying in the order details for the last shop you did!).

Staking out a position in ecosystems is important, because enormous value could be up for grabs. McKinsey experts believe that by 2025, some $60 trillion in annual revenue could be redistributed across the economy—one third of that year’s total.

3. Leveraging Open Data/Big Data

Industries are today being transformed through the ability to harvest and share data on an industry scale. There may be potential in your industry to achieve disruption by acquiring, harvesting or sharing data on an industrial scale.

An example of this exists in banking with the Open Banking initiative. Since time and memorial, whenever a consumer wanted to gain finance, they went to a bank and applied for a loan. This used to be a paper exercise. Today, while the forms have become ‘electronic’ and gone online, the actual application process has changed little. Every customer experiences the same tawdry journey, is asked the same questions. This is changing with Open Banking. It’s an industry initiative to encourage individuals to voluntarily share their personal financial data so it can be shard by financial institutions to make applications processes less painful. With Open Banking, fewer questions need to be asked and lending journeys can be personalized to the applicants’ circumstances.

4. Going Codeless

Cloud computing has led to a new crop of industry standards to make computing tasks such as Identity Management, securing data whilst in transit, system-to-system data sharing, etc. much simpler. It’s also revolutionized how applications are authored and deployed. If your IT team is still using code and script to build, deploy and manage apps—then you’re missing out.

Today, modern PaaS platforms like Mendix, ServiceNow and Encanvas allow for the rapid deployment of thousands of apps in the form of an application ecosystem (i.e., a personalized appstore for your business if you will). It means, as McKinsey & Co. puts it, businesses have become App Factories. This is best exampled by Barclays, a U.K. high-street bank, who now describe themselves as a ‘Technology Company with a balance Sheet.’

5. Achieving Hyperautomation

The sum of all these developments is what some people are calling Hyperautomation. Simply put, Hyperautomation is nothing more than recognizing that businesses rely on their internal processes to get jobs done and deliver their customer value.

These mission-critical information lifecycles are resourced through a blend of people, process, technology and data. Cloud computing has democratized a plethora of digital technologies over the last decade meaning it’s now possible for companies to harness any number of approaches (and digital tools) to ‘do things better’, and ‘do better things’. Hyperautomation is the triage process of adopting the best-fit approach and tooling to get work done in the most efficient and effective way.

Businesses unable—or unwilling—to invest in Hyperautomation will be slower to market with innovations, have limited opportunity to personalize their offerings to serve customer offerings, and will be operating with a heavier cost of sale. All these shortcomings, will ultimately become an existential threat to slow adopters.

Ian Tomlin is a management consultant and writer on the subject of enterprise computing and organizational design.  He serves on the USTECH SOLUTIONS Management Team.  Ian has written several books on the subject of digital transformation, cloud computing, social operating systems, codeless applications development, business intelligence, data science, office security, customer data platforms, vendor management systems, Managed Service Provisioning (MSP), customer experience, and organizational design.  He can be reached via LinkedIn or Twitter.

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