When the Cloud Provider Is Not Itself on the Cloud

by Cesar Bacani, 11 July 2012

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cloud computing finance innovation financial transformation

A restaurant owner who does not dine in his own establishment is automatically suspect. Is his menu and chef not good enough that he elects to eat somewhere else?

And so it is with cloud services providers. Among the first things that potential customers should perhaps ask them is this: Are you yourself on the cloud, and if so, is your entire organisation happy with it?

It is admittedly a complicated issue. Many cloud providers pre-date cloud computing and so still have on-premise legacy systems that they are loath to throw away – not to say on-premise solutions that customers still want to buy and many in the organisation still want to sell.

Take Interactive Intelligence, a provider of call centre software solutions and technologies for unified business communications. “We sell our software as premise-based, but we have also started to sell software through cloud,” says Simon Lee, Regional General Manager for Asia. The cloud currently account for “about 30%” of company revenues.

“As an organisation, we also use cloud-based applications like Salesforce.com,” he adds. “But I will say the back-end office systems like our accounting system, which have been in place for years, we are still on that.”

Pure Vs. Hybrid

“Companies that are pushing cloud software should be doing it themselves,” agrees Andrew Milroy, Vice President, ICT Research, at industry research group Frost & Sullivan. “But a lot of companies that are [selling the cloud], including Interactive Intelligence, have an on-premise legacy, which is what they’ve been doing for years and years.”

Frost & Sullivan itself faces a similar situation. “I get frustrated at how little we have on the cloud,” says Milroy. “I know we use Concur for expense management, as Interactive Intelligence also does. Some things we use, but far, far little. We have an enormous legacy of cumbersome, difficult legacy technology that the company still lives with.”

But Milroy says there are pure cloud organisations that are among the world’s most successful companies. “Amazon, everything they do is on the cloud,” he points out. “Facebook, Salesforce.com, NetSuite . . . these are the more recent organisations, and that’s all they’ve ever been about.”

Amazon, Salesforce.com and NetSuite also sell cloud solutions. “All our processes are on the cloud,” Ronen Lamdan, Director, NetSuite Asia, told participants at the CFO Innovation Asia Forum in Singapore in June. Because of this, he says he has complete visibility into actual and forecast sales as well as key back-office operations and financial business processes, including accounting, inventory and order management which makes possible, up-to-the-minute forecasts and planning.

So should companies opt for the “pure” cloud purveyors rather than the hybrid ones? As always, there is no set answer. It all depends on the depth and breadth of the cloud services on offer, the results of the cost-benefit analysis of choosing cloud over premise, and the potential customer’s comfort level with the cloud provider’s security measures, service quality and other factors.

Today you even need to have

Submitted by James Loftcraft on 21 January 2013 - 2:16am

Today you even need to have VoIP security in place because you never know who might intercept your communication and what he/she chooses to do with that. It can really get in you in trouble in relation to privacy and business secrets.

I offer my full support

Submitted by Jim Smith on 25 November 2012 - 7:51pm

I offer my full support towards integrating cloud technology for your business. It can help you a lot with cybercrime at work. Having a cloud network simply takes care of that.

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