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Top 5 Reasons Your Business (Still) Needs A Cloud Native Strategy

Author: Srikanth Thirumurthy

Since we published Cloud native comes of age, my colleagues and I have been talking about the challenges and rewards of cloud-native development. We’ve blogged about why DevOps is the key to modern applications and continuous delivery, and how CIOs can take the lead in reinventing their organizations for digital business.

In our podcasts, we’ve heard from Pivotal’s Matt Stine that the advent of smartphones was the catalyst for developing applications in new ways. Uber’s Charles-Axel Dein described how they motivate and retain talented developers, and Adrian Cockcroft from AWS showed how cloud native was the key to making Netflix a household name.

Based on a survey of 900+ global executives, our report investigates the current state of cloud-native adoption, highlighting stark differences in culture, technology, and business outlook between those considered cloud “leaders” and “laggards.” What makes a leader? In this case, we defined leaders as those developing 20% or more of their applications natively in the cloud.

As leading enterprises forge ahead, let’s spotlight the top five reasons you need to start building a cloud-native strategy today.

1. It’s good for revenue.

Accelerating time-to-market and delighting customers—obvious goals for any enterprise looking to claim a greater stake in the marketplace. But let’s get down to the crux of it; businesses will always want wider profit margins and more revenue.

The cloud-native leaders show that these goals are inextricably linked. By developing and deploying apps faster and monetizing their APIs, the bottom line is enjoying a healthy injection, with

84% of leaders reporting increased revenue and reduced operating costs—as good a reason as any to adopt cloud native.

2. It enables continuous deployment.

“My development team doesn’t need DevOps. Why would they? They’re doing just fine in their silos.” But what if that changed? If the requirement is to enable continuous delivery, would it be feasible in a monolithic architecture?

Your customers expect seamless experiences, they don’t want downtime or inconvenience whenever you develop a new feature. With a micro-services architecture enabled by DevOps, small releases of new digital features become continuous—allowing for greater business agility enabled by software resiliency. Franck Greverie, our Cloud & Cybersecurity group leader says:

“It’s not about whether you currently need to deploy new code several times a day, like Netflix. The question is: What if you had to? If the business needed that type of velocity, could you deliver it?”

3. It’s great for customers.

There are two factors at play here—agility and customer experience. Most cloud leaders (88%) say the cloud-native approach has improved their business agility, while 87% say it has enabled them to provide an enhanced experience to their customers. It’s a win-win for both.

Whether you’re in retailbankinginsurance, or any other sector, your technology team’s ability to amend and deploy code fast and on demand can be transformative for the customer experience. This is particularly vital for businesses looking to build on customer feedback, or those that rely heavily on strong consumer engagement. Abby Kearns, executive director of Cloud Foundry Foundation says:

“A cloud-native approach means organizations can develop and deploy code much more frequently than before. This has transformed the relationship between the business and its customers by enabling it to continuously improve software in response to customer feedback.”

Hear more from Abby in our podcast about innovation culture.

4. It builds bridges.

Not only does cloud-native enable collaboration through DevOps (developers and operations staff, you’re on the same team now), but also helps realign IT as a key partner in the eyes of the C-suite. And as Steve Horning argued in his blog The CIO strikes back, by driving cloud native, the CIO is emerging as a new breed of business leader.

By shifting IT away from its tired perception as a cost center, new channels of trust and communication between the C-suite and developers are opening. When software development is the highway that takes new business ideas to market, business and IT collaboration is imperative to ensure enterprise success, thus contributing to the bottom line. Mike Houston, senior manager of information services at Altria says:

“Cloud native has changed the nature of our relationship with the business. We’re now involved in every conversation from idea forward. When the business is thinking about an opportunity, we are there at the beginning. Rapid delivery changes the relationship.”

5. It’s good for competition.

I already mentioned that cloud native is a great way of driving down operating costs and increasing revenue, but that’s not all. 83% of cloud-native leaders say they’re ahead of their peers when it comes to financial performance—which, let’s face it, is a pretty universal source of morale and a great way of aligning business leaders around the competitive merits of cloud-native adoption.

A cloud-native approach, with its ability to open up new channels and routes to market through micro-services and APIs, facilitates an ecosystem of open collaboration and partnerships across sectors. This trend is already well underway in the Financial Services sector.

Follow the leaders

With the benefits laid bare, all that’s left is to devise an action plan and get to work. As the CIO, the onus is on you to become digital enabler, and drive your business into a bold new era of agile and collaborative development. There’ll be challenges, both cultural and technical, but as we’ve explored over past weeks—none of them insurmountable.

Recognize your team’s existing skillsets and cultural attitude, identify the gaps, and begin communicating the value of cloud native to your team and business peers in a way they’ll understand. Instead of introducing the change to them, champion the change with them.

To learn more about cloud native, and how others are benefitting from a cloud-native strategy, download Cloud native comes of age.

Srikanth Thirumurthy is an executive focused on FinTech, Transformations and Cloud Adoption at Capgemini. Read more Capgemini blogs here.

Sponsored by Capgemini

With more than 180,000 people in over 40 countries, Capgemini is a global leader in consulting, technology and outsourcing services. The Group reported 2015 global revenues of EUR 11.9 billion. Together with its clients, Capgemini creates and delivers business, technology and digital solutions that fit their needs, enabling them to achieve innovation and competitiveness. A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative Business Experience(TM), and draws on Rightshore®, its worldwide delivery model.
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