Cloud computing in the past has been a controversial subject, with companies leery of putting proprietary data in the cloud. But with its promise to reduce costs, scale up, and provide real-time access to data, cloud computing is shedding its reputation and companies are increasingly migrating to this service.
While security concerns and existing investments still remain the biggest roadblocks to adoption, companies' fears are waning due to visible business benefits. In fact, more companies today report the ability to invest in increased product development and innovation after moving to the cloud.
Migrating to the cloud for cost reduction measures is a common practice, but less understood is how to leverage the cloud as a business enabler.
This week, NetSuite, a provider of cloud-based business management software suites, announced a solution that may work to break these barriers. Commerce as a Service, a cloud platform that provides a central system to manage all transactions and customer interactions across all touchpoints, integrates ERP and CRM into a commerce engine. In doing so, it exposes the company's backend commerce functionality and data as services to its frontend application in a device-independent way--supporting traditional browser-based commerce as well as any emerging touchpoint such as smart phones, tablets, and POS systems. As a result, companies can develop new business logic and leverage that business logic across multiple touchpoints regardless of the channel. For example, promotions can be implemented once and enabled across online, phone, and in-store transactions to augment the core transactional capabilities.
Zach Nelson, CEO of NetSuite, explained the benefits yesterday. He described three points of friction that typically plague companies' ecommerce initiatives: Order management is tied to an inventory management system, which is tied to an order processing system, which is linked to the system that retrieves inventory data. "We've eliminated all three systems to make it as frictionless as possible," he said.
In essence, the solution will allow companies to enable a seamless and personalized online shopping experience. Sports Stop is already seeing the benefits. The retailer has seen a 40 percent increase in sales since its beta launch of the cloud suite. But despite such ROI examples, will other companies be comfortable moving their ecommerce to the cloud?
Andy Lloyd, general manager of NetSuite's Ecommerce Products, said "definitely." He said the perceptions have changed from a few years ago. "Five years ago, they were afraid. Now they come to us and say they have to evaluate for the cloud," he said.
Additionally, the motives for moving to the cloud are shifting. Llloyd said originally companies cited cost containment reasons for companies that have in place Y2K-era legacy systems that would total in the millions to replace. Today, he says, the reasons for migration often entail how to improve the business and even run the customer lifecycle. "As we move up market, the 'it's cheaper' reason becomes, 'How can I run my business better?'"
So as your company contemplates moving its core business functions to the cloud, don't just ask how the move can save money, decide how the cloud can enhance your business performance as well as the customer experience. That will entail including people in your organization responsible for architecting the customer experience in the migration planning. IT can no longer operate in a silo when it comes to cloud migration. Together, IT and customer-facing teams can design a strategy that enables efficiency as well as provide a better customer experience.