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A New Realism Emerges as Enterprises Move to Cloud

More companies are beginning to realize that moving to the cloud will require a multi-year plan and many changes to existing business processes.

Even as enterprise adoption of cloud-based alternatives accelerates, IT and business executives are learning that fully capitalizing on these new ‘on-demand’ resources entails extensive systems integration, staff training and process reengineering.

Despite these obstacles, my travels have confirmed that enterprises of all sizes across nearly every industry are moving quickly to take advantage of cloud services to achieve their corporate objectives.

In fact, in most cases they are not expecting to reduce their operating costs by adopting cloud services. They are hoping instead to improve the responsiveness of their business operations, so they can be more agile and competitive. They remain committed to their ‘cloud first’ initiatives because they are convinced that the end results justify a long, multi-stage migration process.

I’ve had the privilege of speaking at a number of customer conferences over the past few weeks. I’ve discovered that many of the enterprises adopting Software-as-a-Service (SaaS) and other cloud alternatives are embarking on a multi-year transition process. This includes revamping their business processes, as well as replacing their legacy software and systems. As a result, a new realism is replacing the old radicalism regarding the rapid results they expect Cloud solutions deliver.

I saw this firsthand at the C3 - CallidusCloud Connections user conference, which brought together over 700 sales operations administrators, marketers and financial managers from many brand-name companies, as well as midsize organizations. I was asked to present THINKstrategies’ perspectives about the realities of SaaS adoption in a panel session.

The panel also included the senior manager and producer admin business strategy at Health Care Service Corporation (HCSC), the largest customer-owned health insurance company in the U.S. During her presentation, she described the arduous process that HCSC has initiated to adopt CallidusCloud’s sales enablement SaaS solution. The challenge she’s faced hasn’t been technical—because CallidusCloud is relatively easy to deploy technologically. Instead, the primary barrier has been organizational, including internal marketing, education and process redesign. It is these issues that have fueled the growth of the third participant in the C3 panel session, Canidium, a sales enablement consulting company and similar professional services firms focused on SaaS solution deployment with enterprise organizations.

I heard about the same adoption issues at the Host Analytics World 2013 user conference. It attracted more than 200 financial managers from enterprises seeking to use a cloud-based SaaS solution to help them better manage their operations and forecast their future requirements. It was interesting to talk to these financial managers. Many are becoming more and more convinced that cloud solutions, like Host Analytics’ corporate performance management (CPM), are not only secure enough to be accepted within their organizations, but also offer flexibility better suited to meet their escalating needs. Yet they are also finding that their legacy systems, software and business processes represent the biggest impediments to success.

The good news is that internal IT organizations can help their business units sort through these issues. In fact, IT organizations are becoming increasingly important in ensuring the success of enterprise cloud deployment strategies and optimizing the business value of SaaS. However, they are also learning that they must strengthen their business analysis skills to augment their software and system expertise.

Most importantly, business and IT decision-makers are discovering that successfully deploying SaaS and Cloud solutions is an extended process. As a result, they are establishing multi-year and multi-stage implementation plans that create a series of milestone events that build organizational momentum and deliver real business benefits.

[Disclosure: I was compensated to present at the CallidusCloud and Host Analytics events.]

Jeffrey Kaplan is Managing Director of THINKstrategies (www.thinkstrategies.com), an independent consulting firm focused on the business implications of the on-demand services movement. He is also the founder of the Cloud Computing Showplace (www.cloudshowplace.com) and the host of the Cloud Innovators Summit series (www.cloudsummits.com). He can be reached at jkaplan@thinkstrategies.com.




Tags: cloud computing, SaaS, software as a service, Enterprise


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