By Kabelo Makwane, Managing Director for Cloud First business at Accenture in Sub-Saharan Africa
Many traditional businesses have failed to realise the full power of cloud due to a number of factors including legacy systems. Today, businesses are no longer asking if the cloud is a part of their future enterprise strategy. They’re asking when and how much of their technology stack should they migrate, how quickly they should do so and the best path for migration. Software-as-a-Service (SaaS) presents an opportunity to create entirely new cloud-enabled operating models.
Harnessing cloud – and the as-a-service muscle that comes with it – means reengineering the IT organisation and the way the company operates. It requires letting go of old command-and-control service delivery and operating models, moving away from centralised structures that value rigour and certitude, and instead, adopting new, nimble models where experimentation and innovation are at the forefront. The traditional IT organisation still has a significant place in the enterprise for at least the coming decade, but a larger portion of it will move to new digital models.
Making these changes will require companies to manage their new high speed, digital organisations in an entirely new paradigm, driving a different mindset across the company culture. Those that succeed can beat their rivals at their own game by adapting to changing market conditions faster, while leveraging the value of scale that has always been at the heart of the enterprise organisational structure. That is particularly the case for organisations running SAP Application as their core ERP system.
SAP’s next generation ERP solutions are accelerating the need to migrate to the cloud in order to gain the flexibility and agility that are the hallmarks of a successful business in the digital age. According to the JP Morgan report, while 16.2% of workloads are running in the public cloud today, CIOs expect that to reach 41.3% by 2020. Moving to the cloud means taking advantage of the investments, innovations and developments that others have already put in place.
Cost is no longer the main driver of the migration to cloud. Rather it’s the flexibility, scalability and productivity that the cloud offers. An array of cloud-based capabilities for SAP, from faster transaction processes and advanced analytics to the Internet of Things (IoT), sophisticated identity management capabilities and industry-specific solutions, can help businesses achieve the agility and flexibility from SAP systems and applications that they need to operate in the digital era.
When businesses are considering whether to move to a private or public cloud platform, it’s becoming increasingly clear that the public route offers the greatest and business benefits. And in determining which public cloud provider to select, at Accenture, we believe that for SAP workloads, Microsoft Azure is the leading choice.
Microsoft Azure is a flexible, integrated platform that can operate as a fully public or a hybrid cloud solution. Used by 90 percent of Fortune 500 companies, Azure’s scalability is enormous. For example, it handles more than five trillion storage transactions every month and supports more than 60 billion hits to websites run on Azure App Service Web Apps.
Gaining the advantage of cloud computing requires restructuring for the future. Accenture research shows that 84 percent of executives believe the IT organisation is shifting from a traditional service provider to a service broker and offering XaaS.
It is something that more nimble companies already do. Consider StubHub, the online ticketing service, for example. The company did not develop its own payment capabilities internally. Instead, it uses Braintree, a payment gateway provider owned by eBay, to process credit card transactions. Without making these types of changes, today’s traditional and hierarchical structure is too rigid to rapidly adopt the new technologies that are constantly evolving. It is critical for organisations to tap into an ecosystem of partners allowing for scale and rapid change.
Most incumbents still operate with organisational structures that require interactions across multiple teams to plan, build and deliver services from strategy and design, to implementation and run. However, the silos involved in each phase make speed to innovation and collaboration daunting to achieve if not impossible.
Digital has come a long way in a short time. Yet in today’s high speed, XaaS world, most IT organisations are lagging. Successful companies will be those that can effectively migrate to a new operating model such as SAP on Microsoft Azure. The result: responsive, agile IT organisations that lead in the new way toward future innovation.