Overcast or bright clouds?

If you're looking for a single benefit that flows uniquely from a cloud-based environment, it is the opportunity to experiment and move quickly with new business processes at very low cost and risk. So says Jon Davidson, COO of integrated MRO supply company IESA, which has been running what amounts to a cloud platform for its clients over more than a decade. He cites one idea floated for JLR, which runs all of its indirect purchasing through IESA, and, in 2011, wanted to tighten spending. The concept involved setting up a spend-value matrix, with multiple levels, so that alternative approval workflows would trigger automatically for its spread of cost centres, each with very different MRO prices. Understandably, that's not the sort of project many firms would undertake lightly. Indeed, had JLR needed to invest in hardware, software and a roll-out programme, the chances are it would never have taken off. Savings weren't obvious, but the complexity, capex and opex implications certainly would have been. Davidson maintains that JLR only agreed to a trial, because management knew that set-up, testing and deployment costs were effectively zero. Everything would be cloud-based and JLR knew that IESA could control development from its end. And it worked: reported savings in the first year alone totalled £650,000, due to purchases blocked that previously would have gone under the radar. We shouldn't be surprised. Think about supply chain execution, business-to-business e-commerce and automated identification and tracking systems, the vast majority of which are cloud deployed. All have long since proved the power of cloud to enable business agility – connecting new companies and products, flexing between formats and protocols, and enabling and supporting new business opportunities. Marcel Kars, Zetes senior vice president of sales and marketing is clear: "Without our cloud-based serial codes database and deployment, the system would be horrible. Think of the disconnects and integration issues." Quite simply, cloud allows some things to happen where otherwise they simply would not be feasible. The only caveat: be aware of standards and practices. As ISACA director Marc Vael puts it: "The board [needs] to see cloud computing not as an IT project, but rather a business strategy." Incidentally, IESA has grown from a £600,000 company 13 years ago to a £140 million enterprise today, which Davidson attributes to its decision not to install systems for clients but to invite them to view its systems online.