As noted in the IBM IBV 2022 Global Outlook for Banking and Financial Markets report, a top finding from the research included that end-to-end digitization of enterprise-wide operations enables new customer-centric business models, new products and services, new ways of working, and an ecosystem of partners. Digitization is critical to meeting customer expectations and powering financial performance across revenue, costs, and capital. (1)
Organizations have invested in platforms enabling their employees to interact and collaborate. Baseline services such as content storage (Box or DropBox) and information sharing (Microsoft Office or Google Workspace) have evolved to a point where organizations are now selecting platforms for communications (Slack), online meetings (Zoom), project management (ClickUp), ticket handling (Jira) and workflow automation (Zapier).
As the customer needs — in the cases above, the employee as the customer — become clearer and business requirements push the boundaries for technology integrations even further, organizations can find that many of these services are now offered together as a single solution from one provider. These services have been built with APIs in many more scenarios, exposing their features and capabilities to other applications and platforms. Sometimes these APIs are abstracted for the business through a marketplace running on a core platform. Other times, they are offered to application developers to integrate into their bespoke applications so the organization can create its own unique workflows.
However, the point here isn’t just about employee collaboration. Instead, as noted in our previous blog posts on the topic of business platform models, we are seeing companies build out new business offerings that follow this same cloud-enabled, API-driven, integrated architecture not just to serve the employees – but also to provide more capability and benefit to customers and partners through an integrated ecosystem that increases in value as each side of the platform expands.
With this shared ecosystem, shared information, and shared services in mind, let’s take a moment to recognize the crucial role that the cloud plays here.
Not surprisingly, the cloud will continue to be the centerpiece for new digital experiences, forecasted by Gartner to garner $474 billion from companies worldwide. It is also likely that, by 2025, 85% of organizations will embrace a cloud-first principle, and over 95% of new digital workloads will be deployed on cloud-native platforms. (2)
Likewise, total cloud infrastructure services spending grew 35% in 2021 to reach USD 191.7 billion. (3) By 2025, Bessemer expects the cloud to penetrate 50% of enterprise software. At the same growth rate, they also predict that cloud will power 83% of software by 2030.(4) One-third of financial organizations indicate it would only take 1–3 years to achieve 75% of workloads running in the cloud. (5)
Let’s face it; there would be far fewer platform companies on the market without the cloud- namely public and hybrid cloud.
Multi-cloud complexities create unique challenges
Getting the cloud right for the platform business model requires a clear view of how to define, architect, design, build, deploy, and maintain a cloud that serves each side of the platform’s business, especially that of the platform owner.
Combining private, public, and hybrid clouds can complicate an organization’s digital transformation to build out its platform business model. This isn’t just about creating or moving on-premises infrastructure, platforms, and applications to the cloud – it’s also about the business processes, access control, cross-cloud communications, modern applications, and data elements that are now distributed everywhere. Making matters worse, hiring multi-cloud and DevOps engineers to deliver on this requirement is not especially easy to pull off.
Many organizations estimate that around 32 percent of cloud spend is wasted, (6) driving the trend behind cloud financial management, or as some refer to it, financial operations (aka, FinOps), which has become a mainstream practice in organizations across all sizes of cloud spend. (7) An essential element in the equation: Managing waste. 24% of FinOps teams are committed to reducing waste or unused resources. (8)
For example, one large financial institution turned to Taos to help find >$1.5M savings per year in the reduction of end-to-end provisioning of infrastructure. (9)
In another case, Taos helped a legal firm client create a custom cloud presence that is adaptable, secured, highly available, and delivers a superior customer experience at lower costs than their original on-premises environment. (10)
As you embark on your cloud-enabled platform business model journey, be sure to look to Taos to help you with some of your core program elements:
- FinOps: Taos helps to efficiently manage your multi-cloud billing, cost management, and chargebacks to help realize the most considerable savings possible.
- Hybrid cloud design, build, migrate and manage: Taos helps to optimize your cloud investments and operations to achieve long-lasting digital excellence.
Indeed, the cloud is only one part of the business platform puzzle. Following this journey with you, we will post more blogs in this series to cover the data and the apps. Read those posts to get the bigger picture of what it takes to bring your organization’s platform business model to life.
Citations:
1 – 2022 Global Outlook for Banking and Financial Markets, IBM Institute for Business Value, February 2022
2 – Gartner Says Cloud Will Be the Centerpiece of New Digital Experiences, Gartner, November 2021
3 – Global cloud services spend exceeds US$50 billion in Q4 2021, Canalys, February 2022
4 – State of the Cloud 2020, Bessemer Venture Partners, 2020
5 – Public Cloud Adoption in Financial Services, IBM, July 2020
6 – Cloud Computing Trends: Flexera 2022 State of the Cloud Report, Flexera, March 2022
7, 8 – The State of FinOps 2022, FinOps Foundation, 2021
9 – Case Study: Taos Accelerates a Digital Transformation for a Large Financial Institution, Taos, June 2022
10 – Case Study: Migrating Legacy Applications to GCP in Record Time, Taos, May 2022