Cloud Services: the driver of digital change. What do you need to know?

Cloud services as the driver of digital change. What do you need to know?

| | Chief Cloud Officer, SEEBURGER

Cloud-DiensteThe driver for digitalization initiatives in many companies are the specialist departments. They are in daily contact with your customers, so they are the first and best choice when it comes to knowing their needs for new (digital) services.

Departments want to react flexibly to these customer needs and provide new service offerings as quickly as possible – with a “short time to market”. Unfortunately, that can often overwhelm internal IT. Here is where standardized, immediately usable cloud services show decisive advantages.

Cloud services as opportunity

Cloud services offer established companies (the so-called “old economy”) the opportunity to hold their own against their new digital competitors.

First, cloud services are the perfect basis for access to IT resources, whether that means hardware, software, or staff and technical know-how. Instead of building technologically demanding scenarios themselves, with all the effort that entails, companies can simply move them into the public cloud. That lets companies save the costs of investing in hardware, software, and staff, so they can concentrate on their core competences.

Second, cloud services offer companies the ideal basis for implementing their digitalization strategies. Cloud services provide standardized, prefabricated, tested, and immediately usable functionality or process components that are called using clearly defined interfaces and can consequently be integrated rapidly into the company’s internal business processes. This means that cloud services make it possible for established companies to be agile and achieve that so-important short time to market.

Different points of view of the departments and internal IT

When implementing cloud strategies, it is essential to keep the different points of view and tasks of the departments and internal IT in mind.

Customer-oriented viewpoint of the departments:

Departments want to handle things themselves: digitalization of quotations, agility, new application scenarios – these are the signs of digital change. This affects every department in the enterprise. Departments are required to network, integrate – both with one another as well as externally with customers and business partners. The addition of cloud services at this level is an opportunity to innovate to set up entirely new, or at least supplemental, business models.

Innovation demands flexibility, agility, etc. The department has to react to rapid changes in competitive structures, just “trying out a quick idea or a cloud service” – ideally, on a self-serve basis. This is where cloud services for the enterprise can act as drivers of innovation. When an idea strikes, however, it also has to be possible to implement it sustainably. This is where internal IT comes into play.

Enterprise-internal viewpoint of internal IT:

The challenge for internal IT is to manage a balancing act. Until now, they have always been responsible for the classical “heavy-duty” integration tasks, like IT modernization, standardization, cost savings, and corporate governance. And they can’t start neglecting these tasks now. But do they have to be dinosaurs, responsible simply for managing the past and all its debt? If they don’t watch out, that is exactly what can happen to them. There is a risk of creating a “shadow IT”, if internal IT fails to react flexibly enough to the challenges posed by the departments.

But this can be seen from exactly the opposite viewpoint, too. The great opportunity for internal IT in the future will be to become an “enabler” – become an active driver providing a central point for technologies and new cloud services. But that requires stronger integration and a concomitant administrative effort. In other words, integration means opening your company, and opening requires control.

Internal IT is, however, frequently not (yet) ready for this task. SEEBURGER can support you here with its API Management solution. If you’d like to learn more, contact us or read our brochure on API management.

What do you need to know?

So cloud services can be a good choice when there’s a need to provide new digital functionality quickly and flexibly. Costs, scalability, and operational stability are the obvious criteria for the selection of a cloud service. But there are other important factors you should keep in mind. For example, the new cloud services need to be integrated into your existing IT infrastructure, and there may be enterprise-internal requirements in terms of security, corporate governance, corporate identity, and the like. The quality of support and the billing model also need to meet your specifications. Below, we list the most important criteria for selecting the right cloud service:

  • General security:
    One of the greatest concerns of the enterprise is data security and the functionality of infrastructure for business-critical operation. And rightly so – as the “WannaCry” virus impressively highlighted recently in over 150 countries. Companies can meet increasing security and compliance requirements by selecting cloud services right from the start which, for example, can be operated in local computing centers and that meet the local data protection regulations and the requirements of contracts under local law.
  • Company-specific adaptations:
    Customized changes are unusual in the cloud world, but the provider should still be ready to make a few company-specific changes. The best example of this is corporate identity – this provides a self-image that works externally to reinforce the company’s presentation and is the basic building block of credibility, acceptance, and trust. In this context, cloud services – especially those facing the final customer – should offer the option of customizing them to the specifications of the company using the service.
  • Comprehensible billing model:
    Usage-based billing is one of the most attractive features of cloud services. However, companies need to be aware that every provider has their own way of modeling prices for their cloud services. While some providers, for example, expect prepayment for a certain basic service, in other cases an additional fee may be required, for example for customer support. Companies must therefore understand the provider’s billing model to avoid later surprises, perhaps even negotiating a customer-specific price if possible.
  • Flexibility of the provider:
    The service provider should have rapid responsiveness (reacting quickly to operational problems) and good, proactive support (such as customer support, preventive maintenance, increasing resources in a shared environment, and so on). The provider should be ready to define company-specific Service Level Agreements (SLAs). These should include, for example, performance, availability, provisioning times, and problem solution deadlines. The last should also feature formal escalation guidelines and defined sanctions. It could also be interesting – and necessary – to check the provider’s history of success with respect to compliance with SLAs.
  • Possibility of integration into a consistent overall concept:
    Interest in the Cloud is growing ever stronger. But almost no company is ready to move their systems entirely into the Cloud. Instead, most companies plan to build a hybrid IT ecosystem. That is, a hybrid cloud in which the resources in the company’s own computing center (possibly in a private cloud) are combined with resources from an external cloud infrastructure (the public cloud). Companies should verify that the provider is able to integrate hybrid environments seamlessly and will also manage them carefully. This can allow a company to use cloud services from the provider as needed to extend its own internal IT resources and options.

SEEBURGER AG has reacted to known requirements for some time, offering integration solutions, community services for supporting enterprise collaborations, and industry-specific solutions for the line-of-business departments as services in the Cloud. Many cloud services can be booked directly by the department without complications, and used immediately – the other services are available upon request. Get an overview of the process at

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Dr. Martin Kuntz

Written by:

Dr. Martin Kuntz has worked for SEEBURGER AG since 2000, and is a member of the Board of Directors since 2015. His strengths lie in the Cloud, business applications, and the digitalization of specialty and technical business processes. He has degrees in physics and business administration. Earlier, he worked for several years in the Simulation department of the Karlsruhe Institute for Technology and for Airbus subsidiary Airbus Defence and Space.