Abhinav Mehrishi, Vice president, Lastaki Advisors Pvt ltd
Cloud-based solutions to manage their businesses. As a result, the adoption of SaaS has witnessed a staggering growth in India. Cloud has essentially enabled management teams to centralize and decentralize simultaneously. For instance, Bengaluru based Mobisy Technologies allows mega brands like Pepsi to obtain a real time inventory data of their distributors, thus helping them optimize their distribution strategy. On the other hand, retailers can place orders with Pepsi distributors using their smartphones, bringing predictability and efficiency to their supply chains. As more and more organizations move towards a mobile first vision, cloud infrastructure has become the cornerstone of their digital strategy. There are real benefits to the cloud first strategy:
•Data-driven Decisions: Cloud has made organizations data-rich by integrating data from disparate systems and devices. Managers are now able to use this data to make daily decisions, as they have access to realtime actionable intelligence.
•Scale: Organizations can achieve global scale in a matter of weeks. In January 2014, Airbnb’s CEO Brian Chesky tweeted, ‘Marriott wants to add 30,000 rooms this year. We will add that in the next two weeks. This exemplifies what Reid Hoffman means by ‘Blitzscaling’ in his latest book.
•Automated Workflows: Long waiting time in customer support calls are soon going to be a thing of the past. Customer assistance, ticket resolution and support services are now being delivered by cloud-based self-service intelligent chatbots.
•From Efficiency to Productivity Gains: The value proposition of replacing capex with opex is now dated. Managers are using cloud solutions to make productivity gains as well. For example, a CRM solution doesn’t just mean an efficient way of lead management it is also a way to potentially increase revenue per user through interactive leaderboards.
Besides this tangible benefits cloud technology is driving management to bring about a revolution in organization culture. With massive computing power available, employees are encouraged to innovate; strategies are becoming truly customer centric, and ‘failure’ is rewarded. This is best exemplified by big internet companies like Google, Amazon, Facebook, Apple and Netflix. Facebook, for example, runs around 10,000 different versions of the social networking app, at any given point in time. Software engineers are given autonomy to launch and test versions of Facebook to assess changes in user experience. Versions with significant results are adopted and less significant ones are documented as lessons learned. This is a unique and powerful way to empower employees.
However, benefits of digital transformation are not being felt enterprise wide, particularly in old economy organizations. Firstly, this is because of a complication called ‘legacy’ systems which take time and investment to migrate to a cloud environment. Secondly, organization leaders are averse to risking disruption on account of long payback periods. As a result digital transformation is often seen as a marketing gimmick. According to Forbes 2016 report, 84 percent organizations failed at digital transformation.