The collaborative cloud Harnessing the brainpower of the enterprise The collaborative cloud Harnessing the brainpower of the enterprise Introduction Early adopters of cloud technology—companies that have planned, implemented and seen the benefits in real deployments—are beginning to establish a track record of “lessons learned” The Economist Intelligence Unit, sponsored by SAP, has analysed the experiences of six companies that have implemented cloud solutions specifically designed to foster collaboration in the workplace These organisations present examples from different types of firms, ranging from start-ups to multinationals These enterprises also represent a range of industries and are drawn from Europe, Asia and North America Each of these companies targeted collaboration for different combinations of stakeholders, including employees, partners and customers Each company tells a unique story of how cloud technology can be planned, structured and implemented to drive innovation and growth Taken together, organisations reveal common patterns found in cloud deployment and represent leading practices to be reviewed and perhaps replicated by other firms that are considering cloud solutions Note: Companies that establish leading practices offer, by definition, stories of success Not all companies that pursue cloud solutions may experience the outcomes described herein These studies are presented as examples of best practices—not as a comprehensive survey on the state of cloud computing © The Economist Intelligence Unit Limited 2015 The collaborative cloud Drivers of change What causes a firm to consider cloud solutions for collaboration? While each of the organisations we studied had unique reasons for adopting a cloud strategy, all shared a common origin—a realisation that they were not harnessing the full brainpower of their organisation and that only a fraction of their intellectual resources were being used to solve business problems Several common patterns were found A number of companies used the words “siloed” to describe the status quo prior to their cloud implementation This describes a pervasive pattern of compartmentalisation of knowledge by region or department, or as the result of acquisitions The result was under-utilisation of knowledge and blocking of cross-enterprise initiatives “We can better,” says Dan Pontrefact, the chief envisioner at Canadian communications giant TELUS Schneider Electric is a clear example of the need to break down siloes The company relies on the collective brainpower of 150,000 employees to build highly sophisticated capital equipment However, its workforce consists of more than 80 nationalities scattered across 100 countries, compartmentalised by departments, disciplines and acquisitions running legacy applications How you get them talking? Brainstorming? Collaborating? The hope was that a flexible technology platform—perhaps cloud—could provide a common vehicle for knowledge-sharing and employee interaction A second driver for consideration of cloud was simple access to knowledge There was a perception of “operational friction”—that sources of ideas and innovation were not being tapped This was particularly true when the firm wanted to access knowledge capital from both within and outside of its own four walls (eg, with partners and customers) Genpact didn’t want to just harness the brainpower of its workforce—it wanted to tap into the intellect of the entire world In partnership with MIT, its decision was to build a technology platform that would source innovations from inventors and entrepreneurs from around the globe This required a tech solution with a pervasive presence and high scalability A third consistent driver was a need for concurrent increased speed and efficiency Planners recognised that current systems—siloed, linear and sometimes paper-based—slowed reaction times, created duplication of effort and increased cycle time on the job Cablex AG, the Swiss telecommunications company, is an example The firm had a paper-based dispatch system that centralised information in one place, delaying response times and increasing duplication of effort The final driver was the decision-makers’ perception of cloud Because of its distributed architecture, its ability to refresh from the centre and its deployability over multiple devices, cloud was seen as a more flexible solution than other technology alternatives There was also perception that, when all of the costs—licences, implementation, training, etc—were counted, that it would be a more cost-effective platform for collaboration These companies all shared the need to better harness knowledge across and beyond the organisation, and then to ensure operational synergies in efficiency, cost-effectiveness and downtime The choice for all of these companies was to focus on collaboration through a cloud solution that could drive increased business innovation © The Economist Intelligence Unit Limited 2015 The collaborative cloud The trigger What caused companies to launch their cloud initiative? The cloud journey of many of these organisations began with the recognition that current systems could not support the standard of collaboration that the business required For Cablex, it was when the number of customers to be served annually reached 75,000 For Schneider, it was the realisation that strategic goals demanded a whole new level of employee engagement For db5, a creative marketing agency, it was a pressing need to construct a low-cost, scalable intellectual capital platform to support the creative process What distinguishes these cloud decisions was the choice to go beyond a quick fix of the immediate problem and to leapfrog to a broader solution that allows for innovation, growth and competitive advantage For example, Canadian telecom firm TELUS saw an opportunity to advance its larger “Customer First” strategy by transforming the service model “to focus on customer outcomes rather than individual transactions” Successful cloud planning teams made a point of including a wide net of stakeholders across business functions (both inside and outside the organisation) from the earliest planning until final implementation Cablex decided on a solution that would reach beyond just field service personnel to include accountants, dispatchers and all other personnel involved in customer service As the Cablex project manager said, “We needed to look at the whole process chain because otherwise we would be just taking incremental steps.” A key driver of this leapfrog solution was that cloud deployments were seen as typically lower-cost and more scalable than traditional solutions “We’ve seen a significant reduction in the time it takes to deploy solutions, and a 15-20% cost advantage over non-cloud platforms,” says Arindam Sem of Schneider Electric Most companies found that employee adoption rates were faster and the threat of disruption was lower than in traditional IT deployments The above facilitated these companies to pursue, and succeed, in a more ambitious cloud-based approach Organising principles How did companies use cloud to establish global, collaborative communities? A clear finding is that support from senior management is critical to cloud success In addition, cloud is not some narrow software deployment but rather, by its very nature, cloud collaboration spans departments, geographies and cultures An overarching strategy and authority must be created to communicate the vision, break down the barriers and drive success For example, Schneider embedded its cloud programme objectives into its 2014-15 Strategic Plan and monitored success at the C-suite level What these leading practitioners did not was assign the project to IT and then sit back and wait for it to happen Successful cloud-planning teams made a point of including a wide net of stakeholders across business functions (both inside and outside the organisation) from the earliest planning until final implementation The primary purpose was to draw requirements and suggestions from all of the future collaborators But equally important was building early buy-in from those who would have to live with the decisions For example, Northwest Georgia Medical Center’s planning team included emergency response teams, cardiologists, dispatchers and nurses Cablex’s collaboration system was designed by dispatchers, IT personnel, technicians and a broad range of other stakeholders This policy of inclusion was also extended to entities outside the corporate firewall Because cloud deployments require little training or installation, the collaborative process was easily extended to outside parties such as customers, suppliers and partners An interesting example is Genpact-MIT’s Intelligent Operations exchange, which hosted more than 6,000 “innovators”—non-employee experts and commentators from around the globe—in just four months © The Economist Intelligence Unit Limited 2015 The collaborative cloud Three recurring patterns in the development and scale-up of the cloud operation became evident The first was that most companies took an incremental approach, building a central platform that attracted a core of users After these “quick wins”, further functionalities were added based on usage patterns and stakeholder requests db5, the creative marketing agency, is an example After establishing quick wins, the cloud-planning team rolled out the cloud solution on an incremental, risk-managed basis Many cited this flexibility and scalability as a reason for using a cloud solution in the first place The second pattern was “get ready for volume” All of these companies experienced an unexpected rapid ramp-up in utilisation—Schneider had 45,000 unique users in three months, Genpact-MIT had 6,000 collaborators within four months and TELUS had a 75% adoption rate in three months This is attributed not only to careful planning of content, but also to the relatively easy implementation attributes of cloud solutions Because cloud deployments require little training or installation, the collaborative process was easily extended to outside parties such as customers, suppliers and partners Finally, all of these companies continued to follow a practice of continuous improvement Cloud analytics enable real-time monitoring of usage patterns, page views and user fall-off, allowing the cloud team to continuously expand and refine functionalities Major new features were added based on a combination of the original implementation plan and continuing feedback from users Applying the technology Rollout and implementation can be fairly simple The ability to mix and match diverse components is a feature of cloud, whether composed of proven open-source apps adapted to the problem at hand or a mixture of cloud and mobile technologies For example, Cablex’s solution integrated a traditional ERM system with a private cloud, using an encryption protocol and mobile devices for every field technician The result was a 25% drop in ticket-to-billing intervals and travel reductions of well over a million kilometres each year The ability of cloud solutions to provide access to a shared database, in combination with the ease of integration with mobile and social technologies, is an acknowledged benefit of cloud In addition to its efficiency gains, Cablex achieved an unexpected improvement in the quality of its customer service as its dispatchers gained greater insight into and knowledge of the service delivery process And costs have become more transparent since technicians’ time can be billed to projects in near-real time Shifting the culture What were the challenges to engaging communities? Notably, the companies did not report major technical challenges—the distributed nature of cloud and its low integration requirement smoothed its implementation at all companies analysed Instead, the major challenge was the human element—the job of getting thousands of employees to leave their siloes and embrace a new platform When db5 rolled out its solution, employees were reluctant to give up email, attachments and paper To help the process along, db5 created change champions to help get everyone up to speed, putting them in the purview of what the company calls the “Keeper of the Magic”: a high-visibility leader charged with getting every single team member excited about the company and its tools © The Economist Intelligence Unit Limited 2015 The collaborative cloud Schneider knew it had to build buy-in from more than 150,000 employees within a 200-year-old culture To tackle this problem, Schneider turned to change champions led by more than 200 local collaboration leaders, who offered training and support, and celebrated success The lesson was that cloud, for all of its technical virtues, requires extensive communication, advocacy and executive support to succeed Achieving buy-in and conversion to the new system, unless properly managed, can present risks to and cause delays in cloud deployments Business outcomes Business outcomes were unique to each company and its cloud programme However, the following business outcomes were common across these leading-practice firms Greater utility of knowledge Users were able to more readily access knowledge that resided in distant or siloed parts of the enterprise, including outsiders such as customers That captured knowledge then had a higher utility, as workers were able to share, amend, improve and evolve the intellectual outputs of the firm In other words, distributed knowledge was made more applicable to the needs of the firm Pervasive information Savings reported were primarily the result of greater operating efficiencies A recurring pattern was that linear knowledge flow—in which downstream stakeholders awaited hand-off of knowledge before taking action—delayed response and created duplication of effort This was replaced by a pervasive availability of information for those who needed it This accessibility resulted in shorter dispatch times, more advanced billing cycles, reduced duplication of effort and other cost-saving efficiencies in operations A platform for innovation Companies reported the creation of vehicles that foster and support the innovation process This was an ability to source fresh ideas (again, many from previously inaccessible sources), to rank and prioritise them and to make them available to the people who can put them into action In other words, cloud acts as a platform for innovation—sourcing it and making it useful Rapid adoption and scalability This study did not explore the relative deployment speeds of cloud versus non-cloud solutions However, virtually all the leading-practice companies reported a (sometimes surprisingly) rapid adoption cycle by users An important factor was a solution that can be rapidly disseminated to end-users and that can be readily scaled up as unforeseen adoption occurs The unexpected benefit of cloud A final business outcome was the “unexpected benefit”—opportunities that were not foreseen at the start of the cloud initiative, but became apparent after it was deployed One pattern was the aggregation and examination of cloud-based data, which gave insight into new business opportunities (eg, new emergency response practices that reduced patient risk) Another was extending operational improvements to adjacent business areas—for example, using an innovation platform to reduce time to market These outcomes are clearly unique to each firm’s situation, but call for an open mind and receptivity to new solutions when working with cloud © The Economist Intelligence Unit Limited 2015 The collaborative cloud Keys to success Looking across these companies, we find five common factors to their success Strong leadership Strong leadership is the common denominator among all of the cases studied This includes executive support from above and strong leadership within the planning team The mechanisms vary, but leadership is almost universally seen as the force that can overcome both resistance to cultural change and technical obstacles such as security Shifting the culture Successful companies took great pains to ensure that their solution was relevant and useful to their users The leading practitioners launched highly proactive campaigns to drive cultural change, typically involving local evangelisers and defined goals, with strong executive support Getting the right people at the table All of these successful campaigns were characterised by inclusiveness in the planning process Future users and stakeholders contributed to the design and rollout of the cloud solution This not only ensured that the product was relevant, but created early momentum in adoption of the cloud solution Test it small, roll it out big Leading practice is to adopt a core, commonly used platform Then, in a policy of continuous improvement, additional features and capabilities are added based on internal analytics and user feedback Through it all, successful companies were ready for rapid adoption and scale-up of the solution architecture Be flexible, open to change and ambitious Finally, some of the greatest benefits were the unexpected Cloud is clearly flexible, creates new usage patterns, and creates new sources of engagement around data and information While meeting the original objectives of the project, successful cloud deployments often led to unexpected opportunities in creating new efficiencies, building revenue and fostering collaboration © The Economist Intelligence Unit Limited 2015 The collaborative cloud Whilst every effort has been taken to verify the accuracy of this information, neither The Economist 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The cloud journey of many of these organisations began with the recognition that current systems could not support the standard of collaboration that the business... commentators from around the globe—in just four months © The Economist Intelligence Unit Limited 2015 The collaborative cloud Three recurring patterns in the development and scale-up of the cloud operation.. .The collaborative cloud Harnessing the brainpower of the enterprise Introduction Early adopters of cloud technology—companies that have planned, implemented and seen the benefits