Relevance of Cloud during COVID-19

The global COVID-19 pandemic is one of the most significant challenges we have faced in many years. With over two million people infected and severe restrictions such as social distancing placed on the population, the pandemic has brought to halt activity in the form we are used to. Undoubtedly, it has set back economies, businesses and people.

Manufacturing (which accounts for 11% of the US economy) output has dropped for the first time since 1946 and plummeted by 6.3%, indicating a massive and unanticipated slowdown. Perhaps less than 1% of the world population has witnessed such an event in their lifetime since the great depression. These are indeed unprecedented times.

While no business, industry or economy has been spared from the COVID-19 impact, a few have borne the brunt harder than others, such as travel and tourism, transportation, hospitality, manufacturing and energy industries. This new normal – be it social distancing or staying at home or working from home- is likely to continue.

Enterprises are grappling with many questions on how to deal with this pandemic efficiently including - 

• How do we take care of employees, and ensure they remain securely connected, stay productive and safe?
• How do we ensure business continuity under this new normal?
• How do we optimize costs without compromising on growth, operations and customer experience?
• How do we acquire new customers while ensuring consistent and relevant experiences for existing customers?

4R – Elements to sail through this crisis

Answers to the above questions are not easy but arriving at a well-defined strategy and using the right technology will help enterprises emerge from the crisis in better shape. And that’s where the value proposition offered by cloud services fits the bill.

 An enterprise should evaluate cloud investments and strategies from a 4R perspective. The 4R’s are:

1. Remote workforce engagement and productivity
2. Resilient systems that help keep the business running smoothly
3. Reducing risk and financial burden
4. Reimagining the customer experience

Remote workforce engagement and productivity  

An organization’s workforce is its core asset, and it must action every step to enable them to work productively. This workforce is not limited to their workforce, but includes partners, outsourced and partner workforces as well. They should be able to work remotely, engage as a team and still be productive.

COVID-19 has proved the need for enabling collaboration and top-class remote working solutions. It would allow employees to access enterprise apps, tools securely and with requisite governance controls in place. Are companies geared for this need? Can their current infrastructure support it without compromising data security?

The cloud makes this possible in an easy and secure way.

Across the spectrum of capabilities required for remote working like application and desktop virtualization, device management, BYOD, VPN services, collaboration suites, the cloud can help enterprises create a high-performing virtual office.

Resilient systems that help keep the business running smoothly

In any crisis, the fault tolerance, speed of response, and resilience of enterprise systems are tested to the hilt. Inadequate response can cost enterprises heavily. According to a recent study, the average cost of a data center outage is around $9,000 per minute. A crucial need hence is to focus on improving enterprise resilience by a few notches and safeguarding critical applications and systems from failure by enabling speedy recovery.

 In the new normal, enterprises can demonstrate quick wins with these three approaches.

Recover from faults/outages

First, investments in on-premise data centers have constrained IT teams from implementing enterprise-grade solutions for application backup and disaster recovery (DR). Cloud-based backup and DR solutions are viable as they have low entry barriers, shorter implementation timelines and faster recovery time from failures. Some of the obvious benefits would be reduced systems and resources, process management overheads, energy requirements and licenses, thereby reducing the overall cost of backup and DR by about 45%.

Rapidly respond to failures

Second, enterprises need to swiftly respond to incidents more than ever now, as they rely more on IT systems for their business operations. Application classification will change, and there is a need to realign the support models. Adopting a global shared services team for managing services can significantly enhance service levels for assets on the cloud. It brings in the required talent and capacity to handle incidents with appropriate SLAs while lowering costs up to 70%.

Make systems fault-tolerant

Third, migrating critical applications to the cloud when the primary data center for applications is not resilient enough is recommended. It can be achieved through “Infrastructure Modernization” supported by dynamic discovery and automated migration tools.

Reducing risk and financial burden   

The cost of operating the data centers is high, and a large portion of it is capital expenditure (CAPEX), that involves data center refresh to address end of life risks. Enterprises also carry significant technology debts, and hence are unable to prioritize regular upgrades as they are expensive.

Accelerate data center exit strategies

The cloud meets regulatory and compliance needs for various industry segments with a secure foundation built on it. Enterprises with a data center exit or a refresh imminent in the 12-18 months should adopt the cloud as a primary target, thereby eliminating their capex spend. With the right migration and deployment strategy, enterprises can reduce infrastructure and platform costs by about 30% by choosing the right partner who orchestrates the transformation and delivers outcomes impacting the business.

Optimize cloud consumption

Cloud financial management is critical in the current environment as it spans resource utilization and optimization, enabling monitoring and tracking and exerting cost controls on spending. There is a plethora of tools available in the market, which can help in reducing the first time cloud consumption costs by 15%-30%. But enterprises need to take a more holistic approach on cloud economics. They must capitalize on cloud-native services and also adopt a platform-based approach that can bring in a single pane view across a hybrid environment and thereby enable cost reduction. 

Adopt PaaS for middleware/application

In addition to the infrastructure costs, other heavy cost components are the middleware and application technologies license costs. By adopting cloud PaaS and open source technologies, the application landscape becomes more agile, resilient and cost-effective to operate.

Reimagining the Customer Experience

Social distancing and lockdowns are likely to make customers wary of face-to-face interactions. Clearly, this implies the need to enhance customer services through digital channels. History has shown that investing in customer experience during a recession typically ensures higher returns for shareholders, according to McKinsey.

An enterprise can improve the efficiencies of its frontline customer service channels by using conversational digital bots and digital agents powered by cloud technologies, AI and cognitive services.

The imperative is to reimagine the business processes ‘digital-first’ and explore digital native ways of engagement with partners, customers and employees. Enterprises should move to modular digital native initiatives with ‘API-First,’ ‘Mobile-First’ and ‘Cloud-Neutral’ principles and agile development methodologies powered by cloud-native services and open source technologies.

Suffice to say that enterprises need to relook at their business processes and engagement with various stakeholders through a digital lens.

With unprecedented happenings in the present and the future unclear and uncertain, enterprises should plan steps to address the situation with extreme focus. Taking incremental steps, starting with the “remote workforce” and “resilient systems” to handle the current situation and to expand to  others to handle the post-pandemic new normal better.