Digital enterprises: Cloud empowers enterprise growth stories this pandemic

Srinath Srinivasan

By now it is is accepted that the Covid-19 induced lockdown has accelerated digital adoption and also ensured continuity of businesses which have gone for digital transformation. This has meant a significant jump in the use of (hybrid) cloud to implement digital services. In India, this is a convergent route, both large businesses and SMBs are on the path to utilise the technology. As per a recent Nasscom report, in a survey of over 1,000 SMBs in India, 60% were already using cloud, though almost half were at early stages of adoption. Tech-savvy SMBs that adopted cloud have been able to drive 25-30% productivity improvement and 15-20% reduction in operational costs, the report further states.

As far as large enterprises are concerned, a recent IBM report on cloud technology in India shows that 7% of enterprise IT spend is allocated to cloud at present and they plan to increase the share of spend on hybrid from 42% to 49% by 2023. The majority of the cloud budgets are being allocated to hybrid cloud platforms even as their public cloud spend is set to reduce from 50% share today to 43% by 2023. For SMBs, the opportunity of hybrid cloud adoption is in security, analytics and offline-to-online segments. And the sectors these belong to include automotive, e-healthcare, e-retail, and e-learning, among others. These are also the segments that saw a drastic growth during the lockdown period.

Another important aspect of this technological shift is SMBs adopting well-structured cloud strategies. As a result, most of their workloads are in the cloud. The lockdown has also demanded that small businesses adopt workplace automation, the services for which comes from workplace automation tool makers that are cloud-first. These are either made in-house or sourced from unicorns and big tech firms such as Zoho and Microsoft/Google respectively.

Talking about cloud adoption, Debjani Ghosh, president, Nasscom, says, “With the government’s push for cloud adoption by MSMEs, it will be crucial for SMBs in India to think of themselves as digital enterprises and lead the e-revolution for India. Progressive policies and awareness programmes can accelerate cloud adoption. SMBs can account for 28-30% of the cloud market by 2025.” In that respect, one of the widely recognised unicorns in India, Udaan, has been an early adopter of cloud, using Microsoft’s Azure since when it was a small business. When it became a unicorn it still had only 17 engineers due to the engineering capabilities available on the cloud, which helps in tremendous focus on product development and cost savings. The company also uses AI capabilities on cloud for KYC process in its credit business and deployed only one engineer to create a KYC solution on the cloud.
When it comes to large enterprises, AI capabilities that are associated with cloud technologies create a lot of opportunities. For instance, Bharti Airtel, is building a network cloud to support operations, improve time-to-market, and reduce operational and capital expenses, on IBM cloud.

However, there are still some challenges to businesses when it comes to adoption of cloud. SMBs need to scale fast and transform to meet demands of clients, market opportunity and address the internal workforce challenges. “To solve these problems, SMBs will need partners who can provide the relevant technologies and help with the required robust processes, management tools and practices,” says Ajay Mittal, CDO and director, Digital Sales and Commercial, IBM. According to him, this would also lead to a revisit on their own service models, for example, from a traditional services model team depending on desk side engineers, the emphasis will shift towards self help/self healing tools which will allow every single user to continue working without significant intervention. Automation will play a highly critical role in these scenarios.

In the IBM official’s opinion, only 20% of all workloads has moved to cloud. And as far as large businesses are concerned, its internal processes and people need to adapt, at scale, to the new ways. Processes will need to align on receiving services from multiple providers and people need to align on becoming more agile and upskilling, he adds.