Public cloud: a key component of your digital transformation strategy. Key Technologies for Digital Transformation: From RPA to Cloud analyzes the speed, agility, cost-effectiveness, and technical advantages of the public cloud, which has emerged as a prerequisite for the fourth wave of digital transformation (DT, DX, digital transformation).
It is no exaggeration to say that cloud is the most fundamental technology for DX. The emergence of cloud services represented by Amazon AWS, Microsoft Azure, and Google GCP can be said to have accelerated the actual DX. It is now a rare sight to see even domestic companies putting servers in IDCs (Internet Data Centers) and visiting them regularly. For companies that aim to provide global services, the emergence of public clouds is a key tool that solves many complex problems at once, like the sweet rain in a drought. How should public clouds be viewed from a DX perspective?
Contents
Speed and agility in the public cloud: Amazon AWS, Microsoft Azrue, Google GCP
One of the biggest selling points of a public cloud environment is speed and agility. In a traditional on-premises environment, building a server starts with ordering hardware. The infrastructure operations staff, in consultation with the development team, assembles the right mix of components for the server’s availability.
This usually takes a few weeks, or even months if the order is placed with an offshore IDC. Once the hardware is received, the next step is to install the operating system and software for the server, connect it to the network, test it for stability, and install it. From there, you use your own server management software to make sure the server is working properly, and if there are any unresolved issues, you travel to the IDC’s site to deal with them. In a public cloud environment, however, this process is much simpler.
You can select the server specifications you need online, and with a few clicks, the hardware is ready to go. What’s more, when you select a server specification, you can sometimes request that the server operating system or some software be installed. In other words, the public cloud is like choosing a ready-to-wear suit, whereas the old way of doing things was like making a custom suit. Because of this immediacy, the public cloud has the advantage of being faster and more agile than traditional methods, which means you can spend less time bringing new services to market and more time testing them. You can also scale to a global service in minutes.
Cost savings and flexibility benefits
Using a public cloud environment can also save you money. Of course, this can be controversial. Recent public cloud environments utilize PaaS (Platform as a Service, a model that provides various IT infrastructures necessary for app development in the form of a platform, and companies only need to worry about app development), which may cost more than a traditional server configuration. However, from the perspective of traditional server operation, cost savings are inevitable until a certain scale is reached. In addition to the pure infrastructure costs of running a single service, there is also a significant cost for operating personnel. With the public cloud, these labor costs can be flexibly managed.
In addition, since the public cloud is not an investment in servers (hardware), you only pay for what you use (pay-as-you-go). This means that for corporate accounting purposes, it is not an “investment” but an “operation” of an asset. In addition, pay-as-you-go allows you to try different business experiments without worrying about the cost if you don’t know what your server usage will be.
In server operations, server specifications are determined based on an agreed transaction between infrastructure personnel and developers, and if the actual usage is less than this, it is an over-investment in the server. In other words, if a server with an availability of 100 is actually operated and only 20 is used, 80 server resources are over-invested.
In fact, these details are rarely reported to the company’s management, and even if they were, they wouldn’t be able to recoup the investment. However, in a public cloud environment, you have the flexibility to handle this situation. If you set up 100 server resources and only use 20, you can downsize to 25 or 30. This scalability and flexibility is also a huge advantage in the opposite situation.
If your service is so successful that you experience a temporary spike in demand for server resources, you can quickly and flexibly scale up your server specifications, and we’ve seen examples where this flexibility has actually reduced server failure rates by more than 50%. Even if you do experience a serious problem with your server resources, your server recovery time will be much shorter than before.
DX Core Technologies and the Public Cloud
There’s another important factor in utilizing the public cloud from a DX perspective. This is that most of the latest technologies for DX, such as artificial intelligence, big data, and the Internet of Things, are implemented in public cloud environments. As we mentioned earlier, it’s important to utilize external resources to build well-crafted technologies instead of trying to build them from scratch. In this context, we also talked about the importance of open innovation. If you want to take advantage of this scalability and fast-moving technology at the right time, you can only do so if your company’s systems are in a public cloud environment.
Whether you’re creating a minimalist product to bring to market or experimenting, the public cloud can give you the most bang for your buck. In the old way, it was difficult to start a new business because you had to acquire a lot of assets, starting with hardware, and the sunk costs were quite high if the business failed, but now you don’t have to worry about that. Of course, how well you utilize the public cloud environment is another matter, and it’s also an internal capability. Nevertheless, the public cloud has become an integral part of the DX landscape.