Accelerating Digital Transformation with the Cloud

Cloud computing has revolutionized the way businesses operate to such an extent that cloud transformation is the catalyst for digital transformation.

It’s what enables orgs to leverage big data, embrace new ways of working, pounce on emerging opportunities, and pivot in response to new requirements.

On-premises systems and legacy tech don’t just slow digital transformations — they keep from happening in the first place.

Digital transformation literally can’t happen without the cloud. But, there’s a catch. Migrating to the cloud alone won’t deliver anything even remotely transformative.

This article looks at the cloud’s role in digital transformation and how it’s evolving to accelerate outcomes amid changing conditions.

How Does the Cloud Support Digital Transformation?

Digital transformation and the cloud are inextricably linked. But, it’s important to understand that cloud transformation, on its own, is hardly transformative.

So again, digital transformation is the process of using digital technologies to create value for a business, its employees, and its customers. That might mean optimizing processes, enabling remote work, developing new business models – whatever it is that enables your business to stay competitive.

Cloud transformation is both a subset of digital transformation and an enabler. The process involves migrating data, workflows, apps, infrastructure, and so on to the cloud – allowing you to improve efficiency, agility, scalability, etc. But, it’s better to look at the cloud as a foundational building block that paves the way for high-impact use cases.

Think – leveraging predictive models, advanced analytics, and AI-driven automations to make strategic improvements to your core business.

Evolving Cloud Strategies to Fuel Digital Transformation

The cloud has played a central role in our digital lives – both at work and at home – for more than a decade.

According to Gartner Senior Director Analyst, Paul Delory, cloud adoption accelerated rapidly during COVID – and will likely continue to accelerate in the coming years.

Cloud services have been a critical lifeline for companies, allowing them to quickly respond to new conditions and threats – not only allowing them to stay competitive, but also ensuring their survival during that difficult transition.

Now that everyone is in the cloud, it’s getting harder to compete with out-of-the box solutions.

And, as a result, companies need to take their cloud strategy to the next level to stay in the game.

Here’s a quick look at some of the strategies leading orgs are using to tackle new challenges and fuel long-term growth.

Industry Ecosystems in the Cloud

Cloud providers are ramping up investments in verticalized industry clouds – which combine traditional cloud services with industry-specific capabilities.

Gartner VP Analyst Gregor Petri explains that industry cloud platforms are designed to turn out-of-the-box cloud platforms into business platforms. They build on existing tools, making them more relevant to businesses operating in specific verticals – say, field services or agriculture.

Typically, industry clouds are built by solution providers (i.e. Microsoft) or technology partners like Velosio – leveraging cross-industry innovations to tackle niche-specific challenges and accelerate time-to-value.

What they don’t do, according to Petri, is function as one-off SaaS solutions that integrate with core systems.

Rather, these platforms are modular, composable, and supported by an existing catalog of packaged capabilities.

So, if you look at something like Advanced Projects for Business Central, you’ll get a package of capabilities that build on D365’s default functionality. That way, users end up with a unified platform capable of managing advanced projects. It’s not an integration because it’s built on the same underlying platform as D365 using the same common data model. In other words, it’s sort of like an expansion pack.

IT leaders should anticipate that customizations will be necessary. Even specialized industry solutions still need to be tailored to your needs. Yes, you get to bypass much of the implementation and configuration process – but the point is, you can immediately start focusing on the parts of your business that set you apart from the competition.

Long-term, Gartner advises business leaders to target verticalized solutions that complement core service offerings. Essentially, your main platform should serve as an “exoskeleton” that supports a network of industry cloud platforms.

As your strategy evolves, you can add new industry clouds or replace existing ones to drive specific improvements. This approach provides greater flexibility and agility – making it easier and more affordable to pursue game-changing DX initiatives.

Hybrid-Multi-Cloud Gets More Strategic

McKinsey researchers say digital leaders are increasingly focused on maximizing the value of cloud services and containers. They’re no longer focused exclusively on refining technical architectures. They’re instead using data to realign priorities and ensure investments deliver the biggest returns in the least amount of time.

One of the ways orgs are doing this is by embracing hybrid-multi-cloud strategies. IBM’s 2021 report, Cloud’s Next Leap, revealed that hybrid-multi-cloud is now the dominant architecture for cloud service delivery.

According to the research, the percentage of respondents relying on a single public cloud dropped from 16% in 2019 to 2% in 2021.

This approach is gaining more traction among orgs as they take steps toward transforming front-end operations — which, crucially, is where DX winners separate from the rest of the pack.

For example, some orgs are segmenting workloads between clouds so they can create cloud environments that support different business units, geographic locations, or tech stacks.

Hybrid strategies that combine cloud and edge computing are also becoming more popular – particularly among orgs that lean heavily on the IoT. Processing data at the edge unlocks performance advantages – like low latency and the ability to leverage AI and ML capabilities instantaneously.

According to Deloitte’s 2023 Tech Trends, multi-cloud adoption is still rising — and as a result, cloud management is getting a lot more complex.

Analysts describe multi-cloud as a “tangled web” orgs must untangle before they can tap into benefits like enhanced security or more control over IT spending. Otherwise, redundancies, inefficiencies, and security gaps will get in the way of progress.

Gartner recommends mapping workloads to right-fit cloud services providers to simplify the process. The idea is, decision-makers can visualize business requirements, then determine which services cover all the right bases — without adding unnecessary expenses or bloat.

Savvy orgs are using platforms like Azure to combine disparate cloud services, sometimes from different providers, into a single pane view.

Some are also adding a compatibility layer, or “metacloud,” on top of the entire environment for improved interoperability and more cohesive experience. Metaclouds provide access to data, AI, compute, storage, operations, development tools and more.

Standards and security protections are applied across all platforms, and developers can build cloud-native solutions without specialized skills.

Cloud-Native Development

The cloud makes it easier and faster to validate ideas, develop apps, and launch new solutions without wasting valuable resources. As a result, you can bring new products and services to market faster than ever.

But, cloud-native development is more than just moving operations to the cloud.This process aims to take advantage of all that cloud computing has to offer. You know, scalability, resilience, agility, flexibility, and so on.

Typically, cloud-native apps are broken into smaller microservices and packaged in containers that can then be deployed across a variety of servers and environments.

For legacy companies, this may be challenging. They’ll need to replace outdated infrastructure, apps, and processes with cloud-native solutions. And, they’ll need to identify opportunities to improve business performance with new technologies.

But, that doesn’t necessarily mean you need to build a whole new infrastructure from scratch.

When ShipServ migrated from their on-prem system to the Azure cloud, they used a canary deployment strategy to enhance their core platform, one phase at a time.

The company used Azure DevOps pipeline automation, an event hub to help streamline transaction data in the cloud, and Azure Kubernetes Services (AKS) for app containerization. Additionally, they used Azure API Management to manage their API suite.

The ShipServ team deployed several different solutions to the new platform, including containers, clusters, and cloud-native microservices – all of which can be changed or replaced without disrupting the rest of the platform.

Keep in mind, you may need to rethink your entire approach to development. That might mean training your teams on DevOps best practices or upgrading your environment to enable rapid experimentation and innovation.

Platform Engineering

Platform engineering is a strategy that supports digital transformation by enhancing developer productivity and accelerating app delivery.

Gartner predicts that by 2026, 80% of software engineering orgs will have dedicated platform teams focused on providing employees with reusable components, services, and a curated toolkit.

As low-code/no-code platforms, self-service analytics, and AI/ML adoption continues to rise, IT leaders are seeking out solutions to help them better manage and provision these services.

Now, we already know the cloud enables users to leverage these technologies in the first place. Savvy orgs take things a step further. They’re using cloud-based engineering platforms to deliver critical insights and tools to the right people – within the flow of daily work.

Ultimately, the goal is building a system that allows organizations to get the most from their data and solve problems faster.

Subject matter experts must consider what tools, processes, and capabilities make sense for each group of end-users. Then, from there, determine how to build a friction-free self-service experience that supports DX goals, while also reducing the cognitive burden on employees.

Azure provides a centralized foundation for platform engineering. Users can monitor and manage all services in one place – and embed them into workflows based on the needs of each end-user group.

For example, you might use Azure DevOps and GitHub to manage customer feedback, set up tools and processes to make it easy for dev teams to follow the build-measure-learn feedback loop.

For non-technical users, it’s more about empowering users by making data more accessible and providing tools that help them solve problems on their own. Professional services firm PwC used Azure Bot Service to enable data retrieval and analysis – embedding AI search into everyday apps like Teams and SharePoint.

By automating the search process, experts were able to run queries during client interactions and instantly serve up relevant, personalized insights.

Final Thoughts

The cloud unlocks transformative capabilities in systems and apps both familiar and futuristic.

But, in order to succeed, orgs must keep evolving cloud strategies to align with changing conditions, mitigate threats, and stay competitive for the long haul.

Velosio is a Microsoft Gold Partner with deep cloud expertise and over 30 years of experience helping clients transform their business.

We provide proactive consulting services, industry-specific solutions, and hands-on support for all things cloud – whether you’re just starting the migration process or gearing up for another round of optimizations. Contact us today to get in touch with a digital transformation expert.