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As ‘industry clouds’ emerge, get ready for the next cloud rush

December 21, 2021 - 559 views

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As ‘industry clouds’ emerge, get ready for the next cloud rush

Industry clouds will spur even more cloud migrations, as businesses can apply the benefits of this environment to their crucial business workflows.

With all the talk of cloud in businesses and IT circles, you’d think everyone had either completed a cloud migration or set their sights on it. But while there’s lots of activity in the market, the reality is that cloud currently accounts for only 10% to 15% of enterprise IT spending, according to Gartner estimates.

Harkening back to Geoffrey Moore’s famous “Crossing the Chasm” model of the technology adoption lifecycle, this puts us squarely in the early adopter phase, and yet to reach the mainstream. The fact is, while many organizations have moved data center infrastructure, applications and data to the cloud, few rely on this environment for critical business functions that are integral to running their business, like patient onboarding in healthcare and loan origination in banking.

From what we’re hearing among clients, a key reason for this is that their critical business workflows are highly customized to the needs of their specific industry, whether it’s regulatory compliance or an acute need for data privacy. They’d either be starting from scratch to reorient these processes in the cloud or relying on skills and talent they simply don’t have.

Enter ‘industry clouds’

That’s why we believe we’ll see a surge in cloud adoption in the next year and beyond as industry clouds emerge. An industry cloud is a set of tools, services, applications and configurable frameworks that run on a native cloud platform and are specifically tuned to how use cases or processes run in an individual industry, whether it’s patient onboarding, virtual care, loan origination, claims management or supply chain management.

A horizontally-focused customer service cloud process, for example, would focus only on functions applicable to any business, such as accessing the customer account and creating a trouble ticket. But start including data, security, privacy and compliance mechanisms specific to healthcare or banking that aren’t required in other industries, and it’s much more of a compelling value proposition.

If the scaffolding is there for, say, a healthcare company to be HIPAA compliant when sharing patient data with an insurance company, it’s no longer necessary to recreate the wheel — these functions can be already built-in, thus lowering barriers to adoption and also increasing confidence in the solution.

Suddenly, the cloud is not just home to applications, infrastructure and data but also an integral part of how things get done. Cloud’s proven ability to add flexibility, agility and speed to IT-oriented processes is now accessible to business users, as well.

Further, the current shortage of talent and expertise in cloud infrastructure, data and AI means many businesses would value templated but still configurable processes to provide the majority of what they need. With industry clouds, businesses only require a small team to make needed modifications to the industry cloud’s core elements. This allows the business to focus on competitive differentiation and automate the manual tasks that don’t add much value.

Hyperscalers and beyond

An example of industry cloud is Microsoft Cloud for Healthcare, which provides pre-built software for activities such as patient engagement (marketing, onboarding, scheduling, etc.), team collaboration and clinical insights. The platform can also integrate with third-party systems that offer more specialized services, such as medical records or payments.

So far, Google and AWS have taken a different approach that builds on partnerships and industry ecosystem collaborations to create a complete solution. Rather than building a dedicated industry cloud, each provides a set of solutions to particular industry challenges or use cases using tools and frameworks in their stable or through ecosystem partnerships.

For example, Google Cloud has a partnership with Amwell for virtual care and with Blue Shield of California to use AI and machine learning to process healthcare claims in real time to provide a retail-like customer experience.

Industry clouds will also benefit from the rapid growth of cloud-based software startups and new ventures that address a specific scenario or part of a business process, as well as enterprise software companies moving to cloud.

How to get started

While it’s still early days, businesses would do well to start thinking about industry cloud now. We suggest businesses:

  • Create and execute a strategy for moving data and applications to the cloud. Even for businesses that prefer to wait for industry clouds to mature, the best way to prepare is to start moving data workloads and applications to a hyperscaler environment.

  • Identify the areas in your business most in need of agility, flexibility and speed. Look for workflows and processes where competitors are gaining traction and where needs could be met more quickly using technology that’s flexible and agile, from customer care to claims processing.

  • Begin exploring the industry-specific solutions and capabilities in your cloud provider(s)’ portfolio or the ecosystem they’re developing and how that maps to your business challenges and opportunities. Certain industries are particularly relevant for this type of solution, such as healthcare, financial services/banking, insurance and retail.

    We’re currently talking with a large healthcare provider in the US, for example, that is considering industry cloud to improve the patient experience for scheduling appointments and to provide practitioners with easier access to patient data for better patient engagement. We’re also working with a European telecom provider that wants to enable a more seamless and automated way to quickly provision new services for business customers.

  • Plan for pilots. Once opportunities are identified, it’s time to execute pilots or proofs of concept to assess the viability of industry cloud in your business. It’s essential to set tangible targets for return on investment for these pilots, and then look to assess, learn and build further.

  • Look ahead to business change. Once you’re ready to scale, the focus must shift from technology to technology and business. For one UK-based retail client, for example, ML models that were built for the pilot needed to be trained more exhaustively and kept up to date, and people needed to be educated and trained on the changed business process. These are business change programs and must be treated as such.
Cloud future is the business future

Moving forward, as adoption increases and more enterprises move to industry cloud, more innovation will emerge in the ecosystem, either from startups solving unique industry problems or from suppliers, partners or others joining the industry cloud to create more value through the network and ecosystem.

One day, it might even become more costly and difficult for businesses that aren’t part of an industry cloud to fully participate in the industry ecosystem, as they could potentially face higher costs for integration and collaboration with partners, and possibly miss out on innovation and new ideas.

In these early days, it’s time to look beyond the technology aspects of infrastructure, data and applications and start planning for the next wave of cloud adoption as it gets to the heart of how business will be done in the future.

Digital Business & Technology cloud, cloud adoption, cloud migration, industry cloud

Sanjiv Gossain

Senior Vice President and Global Leader, Google Cloud Business Group, Cognizant

Sanjiv Gossain is Senior Vice President and Global Leader of the Google Cloud Business Group at Cognizant. At Cognizant, he...

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