Born and raised in the cloud: why seasoned providers are weathering the tech storms

Tech outsourcing has evolved dramatically over the last 10 years, with one of the most prominent trends being the rush to the cloud.

October 8, 2012

By Jed Hewson, director of 1Stream

Tech outsourcing has evolved dramatically over the last 10 years, with one of the most prominent trends being the rush to the cloud. Not surprisingly, some of the companies adopting this technology have experienced the so-called “broken promise of the cloud”, where others are enjoying the full benefits. The difference, according to Jed Hewson of 1Stream, lies in with the cloud service provider.

In this economy, it’s not hard to sell the benefits of the cloud. Consumption-based cloud business models are allowing companies (particularly with regards to their call centres) to reduce their capital expenditure and remove the burden of operating and upgrading your own premise-based IT assets. As a result, adoption has been widespread and rapid.

However some companies who have attempted to implement a cloud-based service have been sorely disillusioned as hidden consultation fees drive up costs instead of reducing them or when the “easy-to-use” system proves more complex than previously expected. The problem doesn’t lie with cloud services as a business tool – but rather with the solution that’s being sold.

The reality is that a simple, off-the-shelf cloud solution (as marketed by a number of service providers) will not work.

Cloud services can be accessed at a bargain price, but if services are not included in the contract, clients will find themselves paying exorbitant fees whenever a problem arises – such as integration with existing technology or issues with quality or reporting.

Businesses shouldn’t think of the cloud in terms of a “yes/no” decision, but rather as a “how, when, and which” decisions. There are several services, with different configurations, different degrees of benefit and different degrees of risk. It’s important to understand how your call centres challenges can be met by specific cloud-based options, when to migrate processes to the cloud and which provider will offer the most robust and flexible cloud solution for their current and long-term needs. However, there is a distinct lack of cloud providers who take this consultative approach. In fact, very few providers have the experience needed when it comes to understanding a customer’s needs or foreseeing the potential pitfalls of adopting various services.

The few companies who were “born and raised” in the cloud understand that managers should be walked through choosing and understanding a few services and reporting systems that will work best for the business. Contracts without a service element, on the other hand, can leave managers overwhelmed and at the mercy of abuse. Most contractors provide administrator and end-user training, but with the high churn in the industry this is often money in the water, so the provider can still earn high recurring revenue. The solution in all instances is to negotiate consulting, trouble-shooting and managed service elements upfront.

The providers that are weathering the storm of rapid cloud tech adoption are the ones who are willing to provide support throughout the project life cycle. They aren’t interested in punting a solution-in-a-box or exorbitant add-on fees, but are guaranteeing service at a fixed monthly hosting cost that minimises upfront investment and eliminates those little “surprises” that make it seem as though the cloud can’t live up to the hype.

In addition, we’re seeing small and mid-range companies giving the large systems integrators a run for their money.

Needless to say, as cloud technology becomes more prevalent, companies will start to look for service providers that are able to offer a well-rounded perspective – providers that are engaged with the industry and able to easily resolve or broker a solution to problems their customers may encounter.

The days of the fly-by-night providers, that drop minimal on-site equipment along with minimal instruction at their clients’ doors and then retreat are numbered. The providers that will remain competitive after the initial rush to the cloud has dissipated will be the ones who can offer the true service capabilities that comes from being born and raised in the cloud, as opposed to merely milking it.