Unlocking the trapped value in cloud

  • techUK techUK
    Tuesday16Jul 2019
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    Guest blog: Sundip Bhatnagara, Managing Director UK/I H&PS Cloud Lead at Accenture, discusses the role of cloud computing in enabling digital transformation across...

Pivot to the Future” by Omar Abbosh, Larry Downes and Paul Nunes discuss the term “trapped value” to refer to an organisation’s potential. They describe how AirBnB unlocked the trapped value in people’s spare rooms, how eBay provided an avenue for unlocking the trapped value in unwanted possessions and how Spotify unlocked trapped value by cutting out the middle man.  

The concept of trapped value is a powerful one. When we look at the UK Government’s approach to public cloud, we need to ask the question of, how and where do government departments have value trapped as they transition to cloud/ hybrid solutions and how do we help to unlock it with them?

Public cloud has been an important factor in enabling government’s digital transformation ambition – triggered by the Cloud-First Policy, published in 2013. There has since been a mindset shift from simply viewing cloud as commodity infrastructure and outsourcing to something that enables agility and improves citizen experience and services.

 

To find out more about the UK’s future cloud ecosystem, visit our landing page by clicking here!

Trapped by technology debt

Cloud is often described as the answer to legacy technology, but it is that very legacy that prevents departments from using cloud in the first place. Technology debt is far more than a technical problem: whilst it refers to monolithic applications, flat file structures, and hairball architecture, it also refers to IT’s diminishing ability to meet the needs of the business. It is a measure of the inefficiencies and duplicated processes created by relying on out dated technology architecture, limiting department potential.

There are solutions. Application refactoring, microservices and API-led architecture can all be used to decouple applications and systems into modular agile business services - but departments need to be careful. Not every business process needs extensive agility and this approach can overwhelm an already pressured IT department, causing new development to quickly become the next legacy. Modern cloud-native applications can be hugely powerful where agility is needed but equally SaaS platforms can deliver real benefits for commodity-like services. It requires a joined-up approach between IT and the business and represents a chance for collaboration between departments.

 

Trapped in the ecosystem

Using cloud makes it easier to embed processes and services across different organisations. For example, with electronic invoicing, we can automate the validation of VAT claims by connecting directly to community systems.

 

Cloud is also a fundamentally different way of procuring and running IT services. Government departments need to think creatively and collaboratively to benefit from this. There are several starting points - from combining with the major cloud providers to employing common management and costs optimisation techniques.

One of the main challenges is how to avoid potential cloud vendor lock-in while evaluating the next steps. It may be that an organisation takes a conscious decision to use a single vendor because the cultural fit mirrors that of their own. For others, especially larger departments, a multi-cloud vendor approach makes sense. Either targeting specific workloads with a specific vendor, or designing for portability, for example by use of open standards. 

Accenture are 90% cloud-based and the tools we have developed allow us to benefit from our providers in this way: contributing millions in ongoing savings. Shared services and common platforms for security also represent huge opportunities. New approaches such as data tokenisation can provide a “herd immunity”, as each department benefits from the protection of the other.

 

Trapped in the operating model

The shift from building, developing and depreciating IT assets to procuring and running cloud services is important. It requires departments and Treasury to think differently both about how funding is allocated.

Cloud allows you to trial bursts of innovation and quick releases of value, but it requires a different way of working with an increased focus on value, collaboration and modern skills. Moving to an OPEX-friendly financial model will help, but without preparation the business teams will be less agile than they could be. Government departments are not alone: every industry grapples with the skills challenge that cloud and digital represent, resulting in a war for talent. To succeed, departments should continue to explore innovative ways to work with suppliers, the recently launched SPARK framework is a great example. They also need to re-train and upskill their own people - moving away from silos, equipping them to work in agile, multi-disciplinary teams and making continuous product development the new norm. In all cases we need to think differently about our definition of value and where and how we use cloud to look for it.

There are challenges, but also substantial opportunities. It requires a joined-up approach across commercial, business and technology teams and the courage and commitment to collaborate across departments. Accenture knows that this demands that we also continue to adapt: and that’s what we’re doing now.

  • Tom Henderson

    Tom Henderson

    Programme Manager | Smart Cities and IoT
    T 020 7331 2043

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