The Evolving Role Of Security In Today’s Ever-Connected World

Pamela Dunn

Where data used to take a back seat in the digital business world, it is now the belle of the hacker’s ball. Because data is so high-value, large-volume, and vulnerable, it is more attractive to hackers than ever before, and cyberattacks on business assets are becoming more sophisticated and more frequent. To protect against this threat, companies must use a mix of old and new tactics to ensure an ironclad security strategy. Security needs to be built into the systems and processes to enable digital transformation, and all aspects of Security Theory should be incorporated into the application. This include tried-and-true tactics as well as new tactics that respond to the ever-evolving threats from creative hackers.

Further, a range of sensitive and valuable information such as personal data, prices, and product procedures, is processed and stored in a company’s internal systems. This calls for special security requirements to ensure that this information is not intercepted or falsified and is available whenever it is needed.

The network perimeter still needs strong protection, but digital companies are realizing that mobile devices and Internet of Things (IoT) devices perpetually create holes in that very expensive wall as they connect to the Internet. With that in mind, security needs to move closer to the business apps. Specific examples include:

  • Identify and prevent attacks from within apps
  • Protect data with an all-encompassing strategy that covers the cloud, on premise, and mobile devices
  • Apply 360-degree correlation analytics across the network, endpoints, application, and data
  • Accelerate threat detection with real-time incident response and forensics to limit threat impact
  • Respond to threats in an adaptive manner with deep-learning-powered cybersecurity analytics

SAP chief security officer Justin Somaini provides insight into which traditional security practices companies should dust off and pair with new best practices to reap the full benefits of digital transformation. Below are suggestions on specific best practices that companies should incorporate to make sure their systems are secure:

  • Ensure that a consistent and regular process is in place for patches and updates. Unpatched software poses the most serious security risk for businesses.
  • Encrypt communications between business systems with SSL/TLS protocols and SNC protection.
  • Check the interfaces to business systems to see if they are adequately secured.
  • Revisit data backup plans and disaster recovery strategies.
  • Review the security configurations of the business systems platform.

At SAPPHIRE NOW in May 2017, Justin Somaini sat down with technology expert Dr. Craig Brown to discuss the topic of enterprise security and the evolving role of security in today’s world. Specific topics covered include securing cross-platform applications and new technologies like machine-learning algorithms and the IoT, as well as how companies need to remain vigilant in their security through cross-functional teams.

Justin and Craig also discussed the opportunities presented when data scientists and security professionals leverage machine learning, neural networks, and artificial intelligence to detect known and unknown threats – in the technology world and beyond. To view the complete video, click here.

To learn more about enterprise security, click here.

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Drive Business Growth With A Hybrid Analytics Strategy

Steve McHugh

Combining the most valuable aspects of on-premises and cloud solutions can be extremely beneficial: utilizing a hybrid strategy for your analytics/BI solution has been shown to improve performance and increase revenue. In a recent survey by Forrester Consulting commissioned by SAP, 92% of companies with well-established analytics/BI practices have seen revenue growth of 15% or greater over the last three years. But in order to see those performance and revenue gains, you need to make sure you’re implementing it correctly. Read on to learn what you can do with a hybrid strategy, why it’s important, and how to build up a hybrid strategy effectively.

What can you do with a hybrid approach?

You can take advantage of a hybrid strategy by appropriately leveraging your on-premises offerings and knowing when to extend or expand to the cloud. The great thing is that a successful hybrid strategy can be enacted in many forms, and it’s important to keep in mind that one size does not fit all. Some companies are using a mix of on-premises and cloud deployments by department, while others are using cloud BI as a direct replacement for on-premises deployments. Further, some companies are even using a cloud BI platform that accesses a mix of on-premises and cloud data sources via the same semantic layer.

But the list doesn’t end there. Look at your current on-premises investments and ask yourself: When can we extend or expand to the cloud to reap these benefits? True success comes from analyzing your company’s unique state and offerings and knowing where to branch out.

Why do you need a hybrid strategy?

Some 82% of survey respondents agree that a hybrid approach is a crucial next step in the evolution of their strategy, and nearly two-thirds of companies report they anticipate their future analytics/BI solution will include a mix of on-premises and cloud resources. The benefits extend far beyond the financials.

A hybrid strategy that successfully takes advantage of the best of what both an on-premises and cloud solution have to offer can deliver significant performance gains as well. You’ll see better business agility due to the self-service analytics/BI capabilities and the cloud’s flexibility. You’ll see optimized business performance thanks to rising user adoption of these tools. You’ll get more value from your on-premises data and investments by leveraging them with the cloud’s capabilities. And finally, more departments throughout your firm will be able to access analytical tools and reports, decreasing the ever-common silo effect.

How can you implement hybrid successfully?

The survey also found that 88% of respondents reported that they regard hybrid analytics/BI platforms as important to their company, and 60% are already using a hybrid strategy for their analytics and data. We know that the market sees value in hybrid solutions and that the need is real. To achieve success and build an effective hybrid analytics strategy, follow the footsteps of hybrid trailblazers by:

  • Increasing investment in analytics/BI technology and resources
  • Pursuing greater use of the cloud for data storage
  • Adopting more powerful analytics/BI tools
  • Implementing tighter security controls on data usage

One thing is certain: hybrid is the future, and those who aren’t currently utilizing a hybrid strategy may soon be feeling the weight of lost revenue. Armed with the right information, this can be a seamless transition.

For more information on how a hybrid strategy can help your firm, download this SAP-commissioned thought-leadership study from Forrester Consulting: “Improving Business Performance By Closing BI Maturity Gaps With Hybrid Cloud Deployments.”

Learn how to improve business decision-making with cloud analytics

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Steve McHugh

About Steve McHugh

Steve McHugh is director for BI Enterprise Marketing at SAP. He has a solid background in enterprise performance management and analytics. For the last several years, Steve has been involved in leading marketing efforts for SAP's on-premise enterprise BI solutions. Currently, his focus is on helping enterprise BI customers with their journey to the cloud, extending and expanding their analytics adoption and use by capitalizing on their on-premise investments and data through hybrid analytics.

Revolutionizing Procurement’s User Experience With AI

Scott Pezza

It’s difficult to boil down the full experience of working with procurement applications into one pithy phrase. When we know what we want, but need to wade through oceans of irrelevant data to get it, we may think less is more. When we aren’t exactly sure where to find what we need and have difficulty locating relevant sources then, well, more is actually more.

Without really knowing it, we’ve created a pretty restrictive experience for ourselves. We need to define what’s needed; we need to know where to look; we need to find the information; and we need to bring it back to incorporate into whatever task we were working on.

This is our user experience. It is cumbersome. It is tedious. It is manual. And thankfully for us, it doesn’t need to stay that way.

Rethinking user experience: three key pieces

While the technology that makes it possible to revolutionize the user experience may be complex from an engineering perspective, what it actually does is pretty simple. If we focus on what’s truly changed, we see that artificial intelligence (AI) impacts three main things: what we see, what we don’t see, and how we interact with our systems. Let’s take a quick look at each of those elements:

1. What we see. The best way to think about AI’s impact on procurement is that it augments or improves the way we do things. Its goal is to make procurement professionals more informed and better equipped for their jobs. This means bringing them user experience elements such as:

  • Tailored content. Intelligent solutions show you the information you need to know, but this isn’t simply about designing a better dashboard. By applying machine learning to analyze the way different functions work, AI-enabled solutions know what information is important to you without your IT team having to design a customized screen for you. The system knows and automatically presents you with the information you need at the right time and place.
  • Guidance and recommendations. In any complex process like issuing a new RFP, there’s always a question of either “what comes next?” or “what should come next?” That’s where AI-enabled systems can really shine, learning from past behavior to understand process flows, business rules, and even things like sourcing goals (such as targets for sustainable or minority-owned suppliers), which can be seamlessly offered to you as options on how to best proceed. Everything is streamlined right within the system, keeping you focused and efficient as you move from beginning to end.
  • Prepopulated forms. This one is deceptively powerful. By understanding what you need and using natural language processing to extract information from both systems and unstructured documents (like attached Word files), AI-enabled systems can reduce your manual effort by filling in forms for you automatically. You simply review and tweak as necessary. No more manual searching. No more data entry. No more repetitive rework starting from scratch each time you kick off any given process.

2. What we don’t see. When less really is more, AI-enabled systems can help keep you focused on what really matters. Using AI-enabled systems, you’ll see a lot less:

  • Irrelevant information. When the system is focused on what you actually need, it can avoid showing you what you don’t. Understanding which commodities a category manager cares about will teach the system which indices to display on a personalized dashboard, for example. Track the things you need to track and ignore the ones you don’t.
  • Inaccurate information. One area where AI has a huge positive impact outside of tailoring what information you see is in improving the quality of data you have available. This is where spend-data classification comes in, and machine learning allows it to be done on a scale – and at a speed – that is simply not possible when humans are doing the reviewing. This means you have access to and can have greater confidence in more data than ever before. And this all feeds back into the learning algorithms and tailored, in-content interfaces discussed earlier.

3. How we interact. Screens, menus, shortcodes, and report runs – they’ve been around forever. There’s a reason that procurement job listings so often ask for experience using specific systems: they’re complicated and are often a barrier to entry all to themselves. AI-enabled solutions offer a few ways to change this paradigm completely:

  • Natural language. Simply put, you can type (or even talk) to your procurement system just like you would to a colleague. Rather than navigating some hierarchy like Document > Create > Create New RFP and then searching through a series of drop-downs to define what you’re looking for, for example, you’d simply type “I’d like to open an RFP for marketing services.” That’s quite a change.
  • Informed choice. Picking up on the previous example, AI-enabled systems can recognize your request and present you with different options. For instance, it may tell you that you can choose to either buy marketing services under an existing, current contract with a supplier that covers your business unit or create a new one using a previous RFP as a template. And it didn’t do that in some strange, complex interface. It sends you a chat message just like your kids would do.
  • Start with review. This was covered a bit earlier, but it bears repeating. When a system is intelligent enough to prepopulate information for you, the way you interact with that system changes. Your job isn’t data entry; it’s review and approval. It’s a productivity gain. It’s an accuracy improvement. And most of all, it’s a quality of life improvement.
  • Manage exceptions. We haven’t focused much on automation, but AI-enabled systems do hold the promise of taking a process from beginning to end without the need for human intervention. We’ve already seen this with “simple” scenarios like invoice matching. By defining rules and applying machine learning to better understand what is and is not acceptable, we can expand this much further. Now you don’t need to spend your time reviewing what the system knows with certainty is fine. You do tactical reviews only when exceptions pop up.

What you need, where and when you need it

While this only scratches the surface, the day-to-day experience of someone using a system founded on these emerging technologies is a tremendous change. These changes are not merely superficial. They’re not just a matter of design. They are, quite simply, impossible to achieve without the advances that artificial intelligence provides. That’s why it seems so fitting to talk about AI’s potential to revolutionize the procurement user’s experience. Providing exactly the information that you need, at the right time, and in the most convenient location – that’s the ultimate expression of a system truly serving the needs of the user.

If this discussion has piqued your interest, we’ve got a lot more to share. Join us for SAP Ariba Live in Amsterdam, coming up April 23–25. In addition to compelling mainstage content, you can dig deeper in breakout sessions dedicated to these fascinating new technologies.

If you can’t join us in Amsterdam, we’ve got you covered as well. Take a look at Intelligent Procurement from SAP Ariba: Making Procurement Solutions Smarter, a new paper that provides more detail on our recent and upcoming innovations in the procurement technology space. There’s a lot of opportunity for technology to drive significant improvements. Today’s a great day to start learning more!

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Scott Pezza

About Scott Pezza

As part of SAP Ariba's Nework Value Organization Center of Excellence, Scott researches, compiles, and shares best-practice information to help customers get the most out of their investments. With a focus on the financial supply chain (invoice management, payments, discounting, and supply chain finance), his research helps inform strategic planning, performance measurement, and program execution. He has spent the past 15 years in the B2B technology space, in roles ranging from software development and support to research and consulting. Scott earned his BA in English and Philosophy from Clark University, his MBA from Boston University Graduate School of Management, and his JD from Boston University School of Law, where he served on the Executive Board of the Annual Review of Banking and Financial Law.

Hack the CIO

By Thomas Saueressig, Timo Elliott, Sam Yen, and Bennett Voyles

For nerds, the weeks right before finals are a Cinderella moment. Suddenly they’re stars. Pocket protectors are fashionable; people find their jokes a whole lot funnier; Dungeons & Dragons sounds cool.

Many CIOs are enjoying this kind of moment now, as companies everywhere face the business equivalent of a final exam for a vital class they have managed to mostly avoid so far: digital transformation.

But as always, there is a limit to nerdy magic. No matter how helpful CIOs try to be, their classmates still won’t pass if they don’t learn the material. With IT increasingly central to every business—from the customer experience to the offering to the business model itself—we all need to start thinking like CIOs.

Pass the digital transformation exam, and you probably have a bright future ahead. A recent SAP-Oxford Economics study of 3,100 organizations in a variety of industries across 17 countries found that the companies that have taken the lead in digital transformation earn higher profits and revenues and have more competitive differentiation than their peers. They also expect 23% more revenue growth from their digital initiatives over the next two years—an estimate 2.5 to 4 times larger than the average company’s.

But the market is grading on a steep curve: this same SAP-Oxford study found that only 3% have completed some degree of digital transformation across their organization. Other surveys also suggest that most companies won’t be graduating anytime soon: in one recent survey of 450 heads of digital transformation for enterprises in the United States, United Kingdom, France, and Germany by technology company Couchbase, 90% agreed that most digital projects fail to meet expectations and deliver only incremental improvements. Worse: over half (54%) believe that organizations that don’t succeed with their transformation project will fail or be absorbed by a savvier competitor within four years.

Companies that are making the grade understand that unlike earlier technical advances, digital transformation doesn’t just support the business, it’s the future of the business. That’s why 60% of digital leading companies have entrusted the leadership of their transformation to their CIO, and that’s why experts say businesspeople must do more than have a vague understanding of the technology. They must also master a way of thinking and looking at business challenges that is unfamiliar to most people outside the IT department.

In other words, if you don’t think like a CIO yet, now is a very good time to learn.

However, given that you probably don’t have a spare 15 years to learn what your CIO knows, we asked the experts what makes CIO thinking distinctive. Here are the top eight mind hacks.

1. Think in Systems

A lot of businesspeople are used to seeing their organization as a series of loosely joined silos. But in the world of digital business, everything is part of a larger system.

CIOs have known for a long time that smart processes win. Whether they were installing enterprise resource planning systems or working with the business to imagine the customer’s journey, they always had to think in holistic ways that crossed traditional departmental, functional, and operational boundaries.

Unlike other business leaders, CIOs spend their careers looking across systems. Why did our supply chain go down? How can we support this new business initiative beyond a single department or function? Now supported by end-to-end process methodologies such as design thinking, good CIOs have developed a way of looking at the company that can lead to radical simplifications that can reduce cost and improve performance at the same time.

They are also used to thinking beyond temporal boundaries. “This idea that the power of technology doubles every two years means that as you’re planning ahead you can’t think in terms of a linear process, you have to think in terms of huge jumps,” says Jay Ferro, CIO of TransPerfect, a New York–based global translation firm.

No wonder the SAP-Oxford transformation study found that one of the values transformational leaders shared was a tendency to look beyond silos and view the digital transformation as a company-wide initiative.

This will come in handy because in digital transformation, not only do business processes evolve but the company’s entire value proposition changes, says Jeanne Ross, principal research scientist at the Center for Information Systems Research at the Massachusetts Institute of Technology (MIT). “It either already has or it’s going to, because digital technologies make things possible that weren’t possible before,” she explains.

2. Work in Diverse Teams

When it comes to large projects, CIOs have always needed input from a diverse collection of businesspeople to be successful. The best have developed ways to convince and cajole reluctant participants to come to the table. They seek out technology enthusiasts in the business and those who are respected by their peers to help build passion and commitment among the halfhearted.

Digital transformation amps up the urgency for building diverse teams even further. “A small, focused group simply won’t have the same breadth of perspective as a team that includes a salesperson and a service person and a development person, as well as an IT person,” says Ross.

At Lenovo, the global technology giant, many of these cross-functional teams become so used to working together that it’s hard to tell where each member originally belonged: “You can’t tell who is business or IT; you can’t tell who is product, IT, or design,” says the company’s CIO, Arthur Hu.

One interesting corollary of this trend toward broader teamwork is that talent is a priority among digital leaders: they spend more on training their employees and partners than ordinary companies, as well as on hiring the people they need, according to the SAP-Oxford Economics survey. They’re also already being rewarded for their faith in their teams: 71% of leaders say that their successful digital transformation has made it easier for them to attract and retain talent, and 64% say that their employees are now more engaged than they were before the transformation.

3. Become a Consultant

Good CIOs have long needed to be internal consultants to the business. Ever since technology moved out of the glasshouse and onto employees’ desks, CIOs have not only needed a deep understanding of the goals of a given project but also to make sure that the project didn’t stray from those goals, even after the businesspeople who had ordered the project went back to their day jobs. “Businesspeople didn’t really need to get into the details of what IT was really doing,” recalls Ferro. “They just had a set of demands and said, ‘Hey, IT, go do that.’”

Now software has become so integral to the business that nobody can afford to walk away. Businesspeople must join the ranks of the IT consultants.

But that was then. Now software has become so integral to the business that nobody can afford to walk away. Businesspeople must join the ranks of the IT consultants. “If you’re building a house, you don’t just disappear for six months and come back and go, ‘Oh, it looks pretty good,’” says Ferro. “You’re on that work site constantly and all of a sudden you’re looking at something, going, ‘Well, that looked really good on the blueprint, not sure it makes sense in reality. Let’s move that over six feet.’ Or, ‘I don’t know if I like that anymore.’ It’s really not much different in application development or for IT or technical projects, where on paper it looked really good and three weeks in, in that second sprint, you’re going, ‘Oh, now that I look at it, that’s really stupid.’”

4. Learn Horizontal Leadership

CIOs have always needed the ability to educate and influence other leaders that they don’t directly control. For major IT projects to be successful, they need other leaders to contribute budget, time, and resources from multiple areas of the business.

It’s a kind of horizontal leadership that will become critical for businesspeople to acquire in digital transformation. “The leadership role becomes one much more of coaching others across the organization—encouraging people to be creative, making sure everybody knows how to use data well,” Ross says.

In this team-based environment, having all the answers becomes less important. “It used to be that the best business executives and leaders had the best answers. Today that is no longer the case,” observes Gary Cokins, a technology consultant who focuses on analytics-based performance management. “Increasingly, it’s the executives and leaders who ask the best questions. There is too much volatility and uncertainty for them to rely on their intuition or past experiences.”

Many experts expect this trend to continue as the confluence of automation and data keeps chipping away at the organizational pyramid. “Hierarchical, command-and-control leadership will become obsolete,” says Edward Hess, professor of business administration and Batten executive-in-residence at the Darden School of Business at the University of Virginia. “Flatter, distributive leadership via teams will become the dominant structure.”

5. Understand Process Design

When business processes were simpler, IT could analyze the process and improve it without input from the business. But today many processes are triggered on the fly by the customer, making a seamless customer experience more difficult to build without the benefit of a larger, multifunctional team. In a highly digitalized organization like Amazon, which releases thousands of new software programs each year, IT can no longer do it all.

While businesspeople aren’t expected to start coding, their involvement in process design is crucial. One of the techniques that many organizations have adopted to help IT and businesspeople visualize business processes together is design thinking (for more on design thinking techniques, see “A Cult of Creation“).

Customers aren’t the only ones who benefit from better processes. Among the 100 companies the SAP-Oxford Economics researchers have identified as digital leaders, two-thirds say that they are making their employees’ lives easier by eliminating process roadblocks that interfere with their ability to do their jobs. Ninety percent of leaders surveyed expect to see value from these projects in the next two years alone.

6. Learn to Keep Learning

The ability to learn and keep learning has been a part of IT from the start. Since the first mainframes in the 1950s, technologists have understood that they need to keep reinventing themselves and their skills to adapt to the changes around them.

Now that’s starting to become part of other job descriptions too. Many companies are investing in teaching their employees new digital skills. One South American auto products company, for example, has created a custom-education institute that trained 20,000 employees and partner-employees in 2016. In addition to training current staff, many leading digital companies are also hiring new employees and creating new roles, such as a chief robotics officer, to support their digital transformation efforts.

Nicolas van Zeebroeck, professor of information systems and digital business innovation at the Solvay Brussels School of Economics and Management at the Free University of Brussels, says that he expects the ability to learn quickly will remain crucial. “If I had to think of one critical skill,” he explains, “I would have to say it’s the ability to learn and keep learning—the ability to challenge the status quo and question what you take for granted.”

7. Fail Smarter

Traditionally, CIOs tended to be good at thinking through tests that would allow the company to experiment with new technology without risking the entire network.

This is another unfamiliar skill that smart managers are trying to pick up. “There’s a lot of trial and error in the best companies right now,” notes MIT’s Ross. But there’s a catch, she adds. “Most companies aren’t designed for trial and error—they’re trying to avoid an error,” she says.

To learn how to do it better, take your lead from IT, where many people have already learned to work in small, innovative teams that use agile development principles, advises Ross.

For example, business managers must learn how to think in terms of a minimum viable product: build a simple version of what you have in mind, test it, and if it works start building. You don’t build the whole thing at once anymore.… It’s really important to build things incrementally,” Ross says.

Flexibility and the ability to capitalize on accidental discoveries during experimentation are more important than having a concrete project plan, says Ross. At Spotify, the music service, and CarMax, the used-car retailer, change is driven not from the center but from small teams that have developed something new. “The thing you have to get comfortable with is not having the formalized plan that we would have traditionally relied on, because as soon as you insist on that, you limit your ability to keep learning,” Ross warns.

8. Understand the True Cost—and Speed—of Data

Gut instincts have never had much to do with being a CIO; now they should have less to do with being an ordinary manager as well, as data becomes more important.

As part of that calculation, businesspeople must have the ability to analyze the value of the data that they seek. “You’ll need to apply a pinch of knowledge salt to your data,” advises Solvay’s van Zeebroeck. “What really matters is the ability not just to tap into data but to see what is behind the data. Is it a fair representation? Is it impartial?”

Increasingly, businesspeople will need to do their analysis in real time, just as CIOs have always had to manage live systems and processes. Moving toward real-time reports and away from paper-based decisions increases accuracy and effectiveness—and leaves less time for long meetings and PowerPoint presentations (let us all rejoice).

Not Every CIO Is Ready

Of course, not all CIOs are ready for these changes. Just as high school has a lot of false positives—genius nerds who turn out to be merely nearsighted—so there are many CIOs who aren’t good role models for transformation.

Success as a CIO these days requires more than delivering near-perfect uptime, says Lenovo’s Hu. You need to be able to understand the business as well. Some CIOs simply don’t have all the business skills that are needed to succeed in the transformation. Others lack the internal clout: a 2016 KPMG study found that only 34% of CIOs report directly to the CEO.

This lack of a strategic perspective is holding back digital transformation at many organizations. They approach digital transformation as a cool, one-off project: we’re going to put this new mobile app in place and we’re done. But that’s not a systematic approach; it’s an island of innovation that doesn’t join up with the other islands of innovation. In the longer term, this kind of development creates more problems than it fixes.

Such organizations are not building in the capacity for change; they’re trying to get away with just doing it once rather than thinking about how they’re going to use digitalization as a means to constantly experiment and become a better company over the long term.

As a result, in some companies, the most interesting tech developments are happening despite IT, not because of it. “There’s an alarming digital divide within many companies. Marketers are developing nimble software to give customers an engaging, personalized experience, while IT departments remain focused on the legacy infrastructure. The front and back ends aren’t working together, resulting in appealing web sites and apps that don’t quite deliver,” writes George Colony, founder, chairman, and CEO of Forrester Research, in the MIT Sloan Management Review.

Thanks to cloud computing and easier development tools, many departments are developing on their own, without IT’s support. These days, anybody with a credit card can do it.

Traditionally, IT departments looked askance at these kinds of do-it-yourself shadow IT programs, but that’s changing. Ferro, for one, says that it’s better to look at those teams not as rogue groups but as people who are trying to help. “It’s less about ‘Hey, something’s escaped,’ and more about ‘No, we just actually grew our capacity and grew our ability to innovate,’” he explains.

“I don’t like the term ‘shadow IT,’” agrees Lenovo’s Hu. “I think it’s an artifact of a very traditional CIO team. If you think of it as shadow IT, you’re out of step with reality,” he says.

The reality today is that a company needs both a strong IT department and strong digital capacities outside its IT department. If the relationship is good, the CIO and IT become valuable allies in helping businesspeople add digital capabilities without disrupting or duplicating existing IT infrastructure.

If a company already has strong digital capacities, it should be able to move forward quickly, according to Ross. But many companies are still playing catch-up and aren’t even ready to begin transforming, as the SAP-Oxford Economics survey shows.

For enterprises where business and IT are unable to get their collective act together, Ross predicts that the next few years will be rough. “I think these companies ought to panic,” she says. D!


About the Authors

Thomas Saueressig is Chief Information Officer at SAP.

Timo Elliott is an Innovation Evangelist at SAP.

Sam Yen is Chief Design Officer at SAP and Managing Director of SAP Labs.

Bennett Voyles is a Berlin-based business writer.

Read more thought provoking articles in the latest issue of the Digitalist Magazine, Executive Quarterly.
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Cloud Computing: Separating Myth From Reality

Misa Rawlins and Krishnakant Dave

Across industries, many enterprise leaders believe and understand that cloud computing is here to stay. Globally, public cloud services market revenue is projected to reach US$411 billion by 2020, compared with $260 billion in 2017, according to research firm Gartner, Inc. Cloud technology in all its forms—software, platform, or infrastructure as a service—is rapidly becoming essential to the needs of business today. With cloud computing, organizations can simplify IT, save costs, scale rapidly, drive standardization and user adoption, and start getting ahead of tomorrow’s needs when it comes to customer engagement, the supply chain, the workforce, a simplified finance function, and more.

Despite the short- and long-term advantages, some executives remain uncertain about the next steps or have lingering questions about the benefits of moving to the cloud. For many leaders, separating the cloud myths from the facts can prove daunting. Start here, with these insights that can help you bust big myths about the cloud and start moving confidently toward a cloud-enabled transformation of your organization.

Myth No. 1: Moving to the cloud is too costly. “Costly” is a relative term. The cloud can be costly – but costs should be weighed against benefit and return once requirements and migration plans are in place. Rapidly evolving business demands, for example, can dramatically alter cloud-related requirements. Meanwhile, new technologies are dramatically redefining the art of the possible with the cloud. Because migrating to the cloud is not a true “plug-and-play” proposition, and many enterprise leaders underestimate what a migration or implementation involves, some organizations can be surprised by the costs of a cloud transformation. Without a clear understanding of the potential benefits—without a clear business case for moving to the cloud—the focus on costs can overshadow the return on investment. Knowing the value that cloud solutions can bring—not just the costs—can help manage expectations.

Myth No. 2: The benefits of the cloud aren’t substantial enough. As vendors adopt a “cloud-first” stance for many solutions and product updates, organizations that move to the cloud may have a competitive advantage—no matter the size of the enterprise. Cloud solutions continue to offer abundant and increasing functionality. And with the help of an end-to-end solution provider, you can configure cloud solutions to the specific needs of your industry and your business. For larger organizations, rapidly deployable cloud solutions can help support growth or the unique needs of certain business units, such as new acquisitions or foreign subsidiaries, for example. For smaller organizations, the cloud can help you position your organization to tap new opportunities and tame growth challenges.

Myth No. 3: Cloud is too risky. All digital technologies and all business models come with inherent risk. In a hyperconnected world, no system is immune from cyber attacks, insider threats, data leakage, or related risks. No transformation project is a guaranteed success. Market changes, new competition, regulatory issues, and other factors can require you to change your cloud strategy overnight.

Because the risks are real, take advantage of resources and capabilities that can help reduce risk and ensure that your technology investments align tightly with clear business objectives. The maturity of the software goes a long way toward mitigating risk with cloud projects. You can add an extra layer of capabilities such as managed cloud services to provide active, hands-on oversight of cloud applications and infrastructure—helping you to avoid service interruptions and address issues proactively.

Myth No. 4: Cloud computing is still an immature technology. Like other evolving technologies, cloud is advancing every day. Those who wait for the next generation of cloud offerings may find themselves missing out on tangible benefits as competitors leverage cloud technology to sharpen their edge. Across industries, leading organizations are not waiting. Many view cloud technology as evolving but necessary, and they are leveraging it effectively today. Some, for example, are tightly integrating cloud software solutions to streamline supply chain processes, boost information transparency, and improve decision-making across the board—all the while tapping the cloud benefits of cost savings and scalability. Others are confidently turning to infrastructure solutions delivered and running solutions in a private or hybrid cloud. Still others are turning to cloud platform solutions to extend the power of existing applications, build modern analytics platforms, or support new Internet of Things business models. Turning the cloud to your advantage may depend less on the maturity of the technology and more on the power of your imagination.

Myth No. 5: Moving to the cloud will be easy. Cloud technology can help organizations streamline and simplify their IT landscapes and their business processes, reducing needs around capital expenses and infrastructure while helping to save costs. But migrating to the cloud requires more than simply plugging in technology. It requires an ability to address a host of considerations—data migration, the business-specific capabilities of solutions, change management, governance, systems integration, security, and more.

A cloud transformation is more than a plug-and-play project or a traditional system implementation. It requires progressive thinking and an ability to align technology with your business needs and processes— for today and for the future. Migrating to the cloud is a journey. Moving forward with the cloud will require a vision of your “to be” state—your destination—as well as a strategy for getting you there.

To learn more, and to find out what IDC thinks about the future of the cloud, please read this study that presents a strategic blueprint for enterprises on their digital transformation journey.

For more information on how to simplify innovation with cloud technology, learn more about SAP Cloud Platform.

Ready to reimagine the potential of the cloud? Contact us to get the conversation started.

Contact Krishnakant Dave at kdave@deloitte.com and follow him on Twitter: @kkdave

Contact Misa Rawlins at mrawlins@deloitte.com and follow her on Twitter: @misa_rawlins

www.deloitte.com/SAP

SAP@deloitte.com

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This article originally appeared on Deloitte.com and is republished by permission.

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Misa Rawlins

About Misa Rawlins

As a senior manager and consultant in Deloitte’s SAP practice, Misa Rawlins enjoys helping her clients not only to figure out how to solve their current business problems, but also to envision how a modern cloud platform can transform their organizations moving ahead. Within the practice, she has specifically chosen to take a leadership role around the sales and delivery of SAP S/4HANA Cloud because she considers it the wave of the future. She has made it her mission to deeply understand this technology to better advise clients on what moving to a cloud infrastructure really means.

Krishnakant Dave

About Krishnakant Dave

As a principal in Deloitte’s global SAP practice, KK Dave is a consulting leader for Deloitte’s largest clients; part of the U.S. SAP leadership team where he spearheads Deloitte's cloud offerings; and leader of global go-to-market efforts in the wholesale distribution and manufacturing sector. In these roles, he assists clients in their business transformation journeys using the absolute latest SAP toolset, which presently comprises SAP S/4HANA, SAP Cloud Platform, and SAP S/4HANA Cloud, among other technologies.