Walking on the Cloud
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Transcript of Walking on the Cloud
"Walk On The CLOUD"How Businesses Need to Think to Profit from Cloud
Shantanu Upadhyay
Oct 12, 2011
1 © 2011 Deloitte Touche Tohmatsu India Private Limited
Cloud Computing: An OLD idea whose time has come
“Computation may someday be organized as a public utility.”
— John McCarthy, 1961
2 © 2011 Deloitte Touche Tohmatsu India Private Limited
Industrializing IT – enabling pay-per-use, bringing IT to new segments
• Bringing non-users like SMBs/ SOHOs into the fold• Within enterprises, empowering lines of business
Democratizing innovation, enabling players to experiment with new models irrespective of size
• New businesses such as Netflix, Groupon et al have been built on Cloud platforms
Paradigm shift
• Innovations from the consumer space are finding their way into enterprise space
Blurring the line between consumer and enterprise IT
Cloud is…
EnterprisesConsumers
Source: Deloitte Analysis, analyst reports, press releases, primary interviews with industry players, SMEs and end clients CIOs
Cloud is driving consumerisation of IT…
© 2011 Deloitte Touche Tohmatsu India Private Limited3
…and will enable IT to inject itself more deeply into product functionality/ business processes
IT Expenditure Vs. IT price index (US)1
IT P
rice
Inde
x
Illustrative example for IT scope expansion: ERP
Production scheduling (MRP),
Inventory management
1960 1970 1980 1990 2000 2010
Customized production, budget and cost controls
Supplier integration, Customer
management
• Traditionally, despite falling costs, IT budgets have remained constant or has expanded
• Going forward, cloud will further push current costs down, freeing up IT budget to be spent in new areas
Support processes integration (finance,
HR, logistics)
E-Commerce extensions, productivity
improvements
Cloud could enable ERP/ IT scope to potentially expand to newer areas involving
• Leveraging unstructured data to drive optimization
‒ Intelligent warehousing – auto inventory management
• Automating newer activities and workloads
0
50
100
150
200
250
0
50
100
150
200
250
1990 1995 2000 2005 2010
IT Price Index IT Expenditure Index
IT Expenditure Index (% of real G
DP)
1. Based on data for information processing equipment and software investments, including computers, peripherals, software and communication equipment Source: U.S. Bureau of Economic Affairs, Deloitte Analysis
Note: Year 2005 value normalized to 100
© 2011 Deloitte Touche Tohmatsu India Private Limited4
Cloud allows businesses to transform IT architecture from “Inside-out” to Outside-in”
Key characteristics of an “Outside-in” approach
• An ability to connect a very diverse set of external parties to a common platform
• A distinct “policy layer” that enables autonomous partners to set business policies and preferences
• An ability to facilitate coarse-grained, long-lived transactions
• Compensation mechanisms that cope with unanticipated developments and modify interactions
Source: John Hagel & John Seely Brown, Deloitte Center for the Edge
© 2011 Deloitte Touche Tohmatsu India Private Limited5
One-stop travel network enabled by cloud
2.8 million consumers
Over 5600 Corporate Clients
160,000 strong merchant network/ suppliers
Travel “Orchestrator”
The future is already here – Rearden Commerce
§ A next generation e-commerce platform that offers apps, services, content and personalization for travel and expense management
§ For consumers, makes the web a highly intelligent, personalized and unified experience
§ For merchants, provides a large-scale, relevance-based one-to-one market place
Travel Agents
Car Rental Agencies
Hotels and Restaurants
Service Contractors
Source: John Hagel & John Seely Brown, Deloitte Center for the Edge; Reardon company website
© 2011 Deloitte Touche Tohmatsu India Private Limited6
Churn
• Fragmented marketplace• Significant customer churn• Low differentiation• Poor customer service
Bus operators with limited or no IT
Business challenges
IT asset-lite bus operators
Internal IT
Amazon web services IaaS Suite
Seat Seller SaaS
Bus Operator Software Service (BOSS)
BOSS inventory management solution for bus operator
SeatSeller for eCommerce companies and travel agents
redBus solutions for Bus operators
The future is already here - redBus
Source: Press releases, Amazon case study, redBus website
© 2011 Deloitte Touche Tohmatsu India Private Limited7
Supply chain collaboration and trade financing platform
Buyers
Suppliers
Trading Network
Transportation and shipping companies
Raw material providers
Financial institutions
Inspection companies
Smart Sourcing
Symmetric Information
The future is already here – TradeCard
§ TradeCard is a supply chain collaboration and trade finance platform
§ Serves 4000+ manufacturers, retailers, suppliers and service providers in 50 countries
§ In addition to connecting buyers and sellers, also includes providers for logistics, payment protection, inspection and export financing
§ Lean financial and physical processes; visible flow of money, data and products enabling true multi-enterprise collaboration
Source: John Hagel & John Seely Brown, Deloitte Center for the Edge; TradeCard company website
© 2011 Deloitte Touche Tohmatsu India Private Limited8
Prescriptions for businesses
1. Evaluate cloud beyond pure IT cost-reduction and flexibility play
2. Develop experience with Cloud platforms at an early stage to prepare for possible disruptions
3. Explore Harnessing “Outside-in” approach to orchestrate Cloud-enabled scalable network-based differentiation/ business models
“A pessimist only sees the dark side of the clouds, and mopes; a philosopher sees both sides and shrugs; an optimist doesn't see the
clouds at all--he's walking on them.”
– Leonard L Levinson
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms.This material and the information contained herein prepared by Deloitte Touche Tohmatsu India Private Limited (DTTIPL) is intended to provide general information on a particular subject or subjects and is not an exhaustive treatment of such subject(s). None of DTTIPL, Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively, the “Deloitte Network”) is, by means of this material, rendering professional advice or services. The information is not intended to be relied upon as the sole basis for any decision which may affect you or your business. Before making any decision or taking any action that might affect your personal finances or business, you should consult a qualified professional adviser.No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this material.©2011 Deloitte Touche Tohmatsu India Private Limited