A value-centric approach to maximizing cloud potential

At present, 47% of the global population uses the cloud. In fact, the cloud computing market globally will grow, with a projected CAGR of 16.3% through 2026, an increase of over half a billion USD since 2021. It is estimated that 50% of enterprises have workloads present in the public cloud and 7% plan to move additional workloads to the cloud in the next one year.

But Infosys’s Cloud Radar 2023 research shows that organizations are progressing from using cloud for merely storage and cost-cutting, and have transitioned to banking on it to drive sophisticated solutions, growth, and transformation. They are beginning to recognize that the cloud is no longer just an IT initiative, but a crucial enabler for achieving organizational goals. Even as they do so, for their cloud investments to be successful, they must align them with strategic objectives that result from having a value-centric cloud operating model.

In India, cloud helped companies continue to be productive and safe during the pandemic as people retreated from offices to homes. This accelerated cloud adoption, which has continued as cloud becomes the foundation for companies to innovate, experiment and expand. 53% of India companies increased their cloud adoption in 2022, and Forrester expects the Indian cloud market to grow by 24% in the next year. But as cloud has evolved to be transformational and adoption accelerates, cloud has become more complex to manage.

A dynamic operating model

For companies to ensure swift and responsible cloud investment, it is critical that their business and IT teams are in sync with each other. An advanced level of collaboration demands the presence of a value-centric cloud operating model, which ensures that the teams can track value flow, create alignment, and encourage engagement around easily measurable goals.

Unlike the traditional project-centric delivery approach that is focused on feature delivery, the product-centric delivery approach involves lesser focus on features, and more on the value of the business outcomes that are being delivered.

Even in terms of funding, project-based delivery involves a yearly project-based funding whereas product-based delivery has a minimum viable product-based funding or quarterly funding. In this model, cloud teams are organized around products and work together to offer client value and enhance customer experience. Product-based teams are cross-functional, long-lasting groups whose business outcomes are measured in terms of objectives and key results (OKRs). These help firms track value flow, create alignment, and encourage engagement around measurable goals.

Differentiating principles for success

Companies need to follow certain principles to ensure the success of their value-centric cloud operating model:

Value-based delivery: Customer satisfaction always comes first. Also, the outcomes that the teams work on – such as revenue improvement, cost reduction, and net promoter score/customer satisfaction score – are measurable.

Customer-centric outlook: It involves understanding the psychology of the customer and solving the issues that they face. Customer feedback is an effective means for companies to derive data on the customer’s pain points. It also helps them devise fresh solutions if the current one is not working.

Diverse ways of working: Using Agile and DevOps methodologies helps create a collaborative mindset. There is lesser hierarchy, the ownership of cloud programs is transparent, and every individual is accountable for the outcomes in it. The teams feel comfortable with taking calculated risks. They do not fear experimentation and adopt different solutions through trial and error until they arrive at the perfect one. The leadership also encourages this culture and bears a more lenient approach towards making mistakes.

Strategy alignment: Ensuring that the team and product align with the vision of the leaders and connect to the overall business strategy. This way, all members work collectively towards accomplishing a shared goal.

Engineering mindset: Assessing which elements of cloud services, products, and delivery can be automated, to solve problems and minimize cognitive workloads.

Innovation: Using cloud as an innovation engine to quickly and efficiently respond to market demands and create varied customer solutions that are ahead of their times.  

Adopting a dynamic, product-centric operating model can arm companies with what they require to stand tall in the face of a volatile digital environment, meet their organizational goals easily, and deliver value to their clients.

Cloud works well, and companies want more. A same-as-always approach to new and more capable cloud technologies will only limit their effectiveness and hinder innovation. This new era of powerful cloud capabilities can only achieve maximum potential with a dynamic operating model.

The best place to start building that operating model is with a clear business case for cloud. Only with a new approach, and an established business case, will companies achieve growth and transformation in the new era of cloud.

-By Anant Adya, EVP- Infosys Cobalt, Infosys