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Cloud Computing as a Competitive Advantage

Businesses that understand how to best leverage the cloud to facilitate innovation will have a competitive advantage

When talking of cloud computing and the value it means for an adopter, we often hear of the cost-cutting benefits. Given the current economic climate, this is a fairly convincing and accurate pitch for the cloud. However, this is far from the only benefit of the cloud. Cloud computing solutions are poised to disrupt the current IT landscape, and in doing so, values that enable competitive advantage will be realized. Two such benefits that come to mind are increased innovation opportunity and enhanced business agility.

Far from being just another IT product, cloud computing is a concept that is rooted in shifting the burden of IT away from enterprises and into the hands of cloud providers. Companies are left to focus on using IT to enhance the business value they deliver, and correspondingly spend less time on enabling that value to be delivered. By allowing this focus on exploiting IT to enhance business value, a hotbed for innovation is established. Talented, dedicated personnel that were once at least partially, if not mostly, devoted to enabling services to be delivered to customers can now focus more of their time on enhancing those services or creating entirely new services. Cloud computing further reinforces a culture of innovation by removing a significant portion of the economic risks associated with bearing out prototypes of new ideas. By making it cheaper and quicker to obtain computing power, developers feel less pressure for every idea they have to pan out. By encouraging more ideas to be brought forth, the subset of ideas that eventually make it to market will presumably increase.  These ideas can mean new revenue streams, increased customer satisfaction, expanded market-share, and more.

The quick and dynamic delivery of computing resources is yet another benefit of cloud computing solutions. In short, IT resources are delivered both quickly and when needed. This allows companies the flexibility to quickly obtain more computing power, such as during a new service roll-out or peak demand periods, and similarly to quickly scale back computing power consumption. The dynamic provisioning capability provides a level of agility previously much harder and costlier to obtain. Gone are the days of procurement periods measured in weeks or months, and instead procurement is seen in terms of minutes or hours. This insulates enterprises against changing market conditions that may result in bursts of increased demand for their services or a shift in demand among its services. In this way, cloud computing affords enterprises the agility to meet the needs of its customers no matter when and how those needs are expressed.

Businesses that understand how to best leverage the cloud to facilitate innovation and dynamically procure computing resources will undoubtedly have a competitive advantage over those that do not quite get it. However, these are just two examples in an endless array of ways in which the cloud can enable competitive advantage. Be on the lookout for more creative and competitive uses of this new paradigm.

More Stories By Dustin Amrhein

Dustin Amrhein joined IBM as a member of the development team for WebSphere Application Server. While in that position, he worked on the development of Web services infrastructure and Web services programming models. In his current role, Dustin is a technical specialist for cloud, mobile, and data grid technology in IBM's WebSphere portfolio. He blogs at http://dustinamrhein.ulitzer.com. You can follow him on Twitter at http://twitter.com/damrhein.

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