Cloud Computing and the Promise of On-Demand Business Innovation

The wow isn't just about technology; it's about process flexibility and reuse that will enable enterprises to quickly serve new customers and launch new lines of business.
COBA in Action

Hypothetical, mashed up, end-to-end, intercloud, situational business processes used to launch a killer new product is depicted below. It's a hybrid Cloud mashup that's ready for a consumer swarm driven by Facebook and other social networks. Thought the iPhone was hot? Well, welcome to the (fictitious) SG Phone, a complete 4G video phone built into sun glasses that will obsolete all others. The heads-up display, ear pods and eye-wink cursor control, backed by voice commands, does it all. Conceived and patented by a scientist gone mad, Warren Buffet's Berkshire Hathaway immediately invested $2 billion on the condition that the product be brought to market in an instant.

How'd you like to be the CIO that could make such Innovation possible? Now imagine that a (fictitious) wiz named Claude Skydancer has a plan. On the design and production side, he would plug in the original design manufacturer Flextronics in Singapore, which, in turn, would tap its suppliers using Avaro's Supplier Information Management as a Service (the same company GE uses) to source and manage any number of Tier-n component suppliers. Flextronics and its suppliers would also tap the GxS Rosettanet PIPaaS business process utility for B2B interactions, as well as Workday's human capital management (HCM) service for its 200,000 employees scattered over 30 countries.

On the customer-facing side of the endeavor, was tapped for sales force automation, and Cordys' The Process Factory served as the grand orchestrator, providing situational process mashups. Google maps were mashed up to bring retailer locations into the picture. Finally, touching the swarm that would emerge at Facebook, Broadvision's E-MU merchandising system for mass customization was deployed. To get ready for the storm, Amazon's EC2 elastic compute cloud was put on standby for when the product launch became overwhelmed by Facebook and other social computing media.

A Cloud Mashup for the (Hypothetical) SG Phone Hybrid Mashup

The Takeaway

Cloud computing isn't just for small- and medium-sized companies and garage startups. Cloud computing makes it possible to create new business platforms that will allow companies to change their business models and collaborate in powerful new ways that weren't practical before. What's important for companies to consider is that cloud computing isn't about technology, it's about technology-enabled business models. In the current economic climate, it just could be time to heed the words of Ian Clarke, creator of the Freenet, "If your business model is selling water in the desert and it starts to rain, you'd better find a different business model." Whether it's selling water or selling financial services, your business models no doubt need a refresh.

In the past, IT was about productivity; now it's about collaboration, a shared information base and collective intelligence: the wisdom of crowds, social networking and cloudsourcing. Companies must now learn how to survive and thrive in a world transformed by social technologies that are outside any one company's firewall. Cloud computing will take globalization to a whole new level. As Cisco's John Chambers put it, "Our world's ability to collaborate will determine the future of companies and countries." And, as GE's Gregory Simpson noted, "The Cloud is simply the platform upon which to build better businesses."

Better businesses are just what the current economic crisis cries out for. In his just-released book, Beyond the Crisis: The Future of Capitalism, renowned Dutch futurologist, Adjiedj Bakas, wrote, "The Chinese phrase for crisis consists of two words danger and opportunity. The current economic crisis marks the end of an era, and the start of a new one. It is the fifth major crisis in 200 years. All of them occurred at the transition from one era to the next. During the current crisis we finally say goodbye to the 20th century and, out of the ashes, transit into a new era with new economic pillars and digital collaboration powered by cloud computing. This transition period offers tremendous opportunities."

Where else but in the Cloud will those opportunities be realized? So, lead, follow, or get out of the way. Yesterday the Internet, today the Intercloud. Welcome to 21st century business. Welcome to the Cloud economy.

Peter Fingar is an expert on business process management and business strategy. He is a former CIO and practitioner with more than thirty years of hands-on experience at the intersection of business and technology. He is the author of nine books, including his latest work, Dot Cloud: The 21st Century Business Platform, (Meghan-Kiffer Press , 2009). For more information, visit