The Covid-19 pandemic and the shift to remote working it has prompted means that 2020 was in many ways the year of the cloud.
The adoption of cloud-based systems and public clouds has soared over the past 12 months as businesses look to digitise quickly and support remote workers. And this trend looks like it’s here to stay.
According to research by Sumo Logic, in 2020 multi-cloud adoption grew by 70% year-over-year.
Verdict spoke to Ian Massingham, global director of startup solutions architecture at Amazon Web Services (AWS) to find out how startups can utilise the benefits of the cloud to adapt to the challenges posed by Covid-19.
Ellen Daniel: What are some of the most significant disruptive changes that have occurred as a result of the pandemic?
Ian Massingham: The Covid-19 pandemic has ultimately changed the way that we live and work, and as a result, all organisations have had to adapt to the challenges it has raised. One of the main characteristics that helps startups to succeed is adaptability. This is such a fundamental necessity for startup success that it resulted in the term ‘pivot’ being coined, which means a rapid, and sometimes unexpected change of direction or business model that helps a startup flourish.
We have seen some fantastic examples from our customers of companies that successfully pivoted their business as a result of the pandemic. For example, Phorest, a company that specialises in computer software for hairdressers, spas, and beauty salon owners, pivoted its business model and quickly built a voucher platform and e-commerce offering to help support salon owners through the pandemic, enabling them to generate income while non-essential services were closed. The cloud-based management system was used this year by over 90,000 salon and spa professionals globally. Another example is Manna Aero, the world’s first aviation-grade, B2B autonomous drone delivery ‘as-a-service’ company. Due to the Covid-19 pandemic, Manna pivoted its business from commercial food delivery and partnered with the Irish government’s Health Service Executive to deliver prescription medicine and critical supplies to the local community, and in particular elderly and vulnerable people, in the town of Moneygall, in southwest Ireland.
The pandemic has also created challenges in some of the sectors where our customers are building new businesses — travel would be an obvious example — but at the same time, it has created growth opportunities for others, such as digital fitness apps or remote collaboration tools. One such company is AWS customer Peleton, a New York-based company specialising in tech-enabled exercise equipment, that has registered a 66% surge in sales this year.
How important is it for organisations to embrace cloud computing technologies?
The pandemic has underlined how important cloud computing technologies are for developing a technical infrastructure and a culture that can adapt to and thrive in different circumstances. This year, we’ve seen enterprise organisations rapidly develop concrete plans for cloud adoption, after years of talking about moving to the cloud without necessarily taking the steps to make that shift.
This change in attitude reflects the central role that cloud plays in enabling businesses to rapidly and effectively transform how they operate and bring new services and solutions to the table – and to therefore adapt to changing circumstances. Often, these adaptations reinvent the organisation, transforming how it works and what it means to its customers – look, for example, at Netflix’s fateful shift from mail-order DVD delivery to streaming.
When we look at the businesses that endure and sustain their success over many years, the consistent factor that unites them is this capacity to reinvent themselves where necessary. Moreover, this is not ‘just-in-time’ reinvention, which happens at the last minute and is prompted by urgent external factors. It is instead continuous reinvention that often takes place when the company is in a good position and is healthy.
There is a cultural factor to this continuous reinvention – the ability to focus relentlessly on customers’ needs, to drive change from the top, and to access the top talent. But there is also a technological factor. Reinvention often consists of launching novel services and/or products and substantially changing internal processes, and knowing what technology is available to you and deploying it effectively plays a key role in accomplishing these changes.
Cloud computing makes it easier to pursue reinvention and enables builders to deploy a broad set of tools and capabilities as they imagine a new way forward.
How has this been impacted by the shift to remote working?
The shift to remote working and the other effects of the Covid-19 pandemic have accelerated the adoption of the cloud by several years. Organisations have had to rapidly adapt to deal with the challenges that the pandemic has presented. Cloud computing has proven an effective tool in meeting these needs quickly, reliably, and without the need for employees to travel or work in close proximity to one another.
It has been incredible seeing how our customers have implemented agile and innovative solutions this year, using cloud computing during the pandemic to adapt to operating remotely. One such example is Morrisons. The British retailer built a cost-effective and flexible contact centre system on Amazon Connect in just eight weeks. The new scalable solution enabled Morrisons to respond immediately to the challenges of the Covid-19 pandemic, and within a day, it enabled every single person in the contact centre to work from home. It was also able to quickly hire a broad range of people from across the nation — such as travel-industry employees who had lost jobs — to respond to the increased call volume, which had swelled to as much as six times the weekly average. AWS APN Partner, Voice Foundry, also used Amazon Connect to help local councils manage call volumes from residents during the pandemic. Not only did it ensure they could meet citizens’ needs at this critical time, it ensured employees could attend to calls without having to leave their homes.
How can organisations ensure that the move to the cloud happens smoothly, effectively and securely?
Depending on the size of the organisation, there are a number of steps that can help ensure a smooth and effective transition to the cloud.
One of the underlying aspects is having well-equipped and well-trained staff. For small businesses and startups this often means hiring people with the right skills who can bring their experience and knowledge. Smaller companies often don’t have the luxury of time to train people – meaning that hiring people with experience is the easiest way to ensure a smooth transition to the cloud.
For bigger organisations, who often have well-developed product and IT teams, and hundreds or thousands of employees, replacing or re-hiring talent is not an option. For these organisations, training becomes a very important prerequisite for initiating cloud migration. One of the first things we do when working with large, enterprise businesses is to develop what we call an AWS Cloud Enablement Engine. This is a dedicated business unit within the organisation that is focused on helping with the cultural changes needed to get the most from the cloud. This can be everything from setting up governance frameworks, so cloud consumption can happen in line with an organisation’s regulatory obligations, through to developing training and certification programs to up-skill all employees on AWS technologies and new ways of thinking.
Secondly, working with partners who specialise in cloud adoption can have a positive impact on the overall cloud migration experience. Companies should look for partners who bring a wealth of expertise in this area and who have a strong record of delivering similar projects for other organisations.
Lastly, it is also important to put in place early foundations for cloud adoption. This includes integrating identity management systems with cloud providers and establishing policies and processes, as well as security protocols, that could be later used to facilitate cloud adoption.
How do you think cloud adoption will change over the next few years?
When it comes to global cloud adoption, we are just at the beginning of the journey. According to Gartner, public cloud is projected to make up 14.2% of the global enterprise IT spending market in 2024, up from 9.1% this year.
For the most part, IT is still delivered by traditional models, where customers own and operate their own infrastructure and data centres. However, as more organisations start to realise the benefits of cloud computing, in part accelerated by the Covid-19 pandemic and the major shift to online this year, we can expect a considerable uptake of cloud adoption and usage over the coming years. However, it’s important to note that cloud will quite often co-exist with existing IT infrastructure in a variety of hybrid cloud models, and in other instances “lift and shift” migrations will see applications or workloads being migrated directly from on-premises to the cloud. These approaches speed up innovation and growth, enabling businesses to adopt cloud technologies in the way that best suits their requirements.
But for cloud adoption to be successful, investing in tech skills will become imperative over the next few years. At AWS, we want to enable our customers to fully benefit from cloud-based technologies, and during re:Invent 2020 we announced our initiative to help 29 million people globally grow their tech skills by 2025 with free cloud computing skills training. This training will be available to people from all walks of life and all levels of knowledge, and we have a variety of pre-existing programmes that address a diverse array of training needs. AWS Educate provides students and educators with online, self-paced cloud learning resources at no cost. AWS re/Start a full-time training program that prepares unemployed or underemployed individuals for careers in the cloud.
And we’re just getting started. Despite AWS being around for 14 years, it is still early days for cloud adoption. Cloud won’t just replace everything. Instead, new applications and new systems will default to the cloud and will grow fast. This means that over time, cloud computing is already vital for organisations who want to build applications and run their technologies quickly, seamlessly, and securely, and it’s importance will only increase.
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