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Cloud - A Blue Sky Strategy for Telcos

Telco product innovation strategies can harness 'Blue Ocean' strategic planning

Ironically the best analogy for describing the opportunity that Cloud presents is the 'Blue Ocean Strategy', a business book by Chan Kim.

It suggests that traditional competitive business strategies encourage exactly that, going head to head with your competitors and bashing it out, whereas a blue ocean strategy is instead about focusing this effort on creating entirely new markets where you have no competition, achieved through new 'disruptive' innovation that also brings with it lower costs.

Despite the name Cloud Computing actually represents a clear blue sky of opportunity in the same way, a huge blank canvas upon which new products and innovative ideas are yet to be drawn. The scale of IT innovation it will drive will be quite breath-taking, and for organizations like telcos and web hosting providers who operate the underlying technologies it offers an associated level of potential growth for their products.

In the recent Cisco cloud white paper they state that:

"Many enterprise-focused service providers have an opportunity to create higher-value, differentiated service offerings. They have unique capabilities they can leverage, including customer relationships, physical assets and operational excellence."

The fundamental business and technical value of Cloud computing is that it defines and creates a new layer of computing, one that sits in between the application and the underlying infrastructure it operates on, so that they can more dynamically manage the relationship between the two.

This is the layer that will sit atop these telco assets and enable an entirely new suite of next generation Cloud products. A simpe example is Rackspace: they have deployed Cloud systems and from this offer products like SitesServers, and Files.

Accelerating Business Value innovation
Overall the opportunity that Cloud represents for corporate customers and their service provider suppliers is this increased capacity for innovation in general, and in a manner that increases the volume of 'Business Value'  that can be delivered by software teams.

Cloud is a general purpose solution for unblocking 'Innovation Gridlock', and will therefore bring with it an effect of 'accelerating innovation' throughout society as a whole.

Vendors like Microsoft offer software solutions specifically for increasing the level of innovation within business processes. Their 'Innovation Process Management' solution combines Sharepoint with their enterprise PPM toolset so that web sites can better harness "crowd sourcing" member involvement.

The same software can also cater for Capital Planning and also Application Lifecycle Management, best practices for managing budgets, resources and project development schedules. Using these tools increases the throughput possible, and better links business needs to supply resources, ie customer requirements to software being successfully deployed.

These combinations can better improve this rate of delivery. As these are applications that can be deployed via Cloud they're ideal for service providers. It equips them with multiple product solutions tailored to their clients business needs from a single technology platform investment, that is scalable due to this underlying technology.

Furthermore the same feedback loop can be built into the underlying infrastructure layer too. Vendors like Apprenda offers an Enterprise Cloud approach for software developers to re-engineer their traditional .net apps for the Cloud, catering for the core mechanics like hosting in a multi-tenancy environment and metering its usage.

With their own Lifecycle features they're building the same innovation feedback loop into the Cloud applications platform as is built into the end-user client application too. It increases the capacity for product innovation with the Cloud service provider, who in turn can therefore equip more customers with the same ability for their business models:  is another solution accelerator that can be delivered via this software.

This enables service providers to become more innovative in their product range that runs applications for their customers to do the same, a hyper-mode of development known as 'Accelerating Change'.

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The Cloud Best Practices Network is an expert community of leading Cloud pioneers. Follow our best practice blogs at http://CloudBestPractices.net

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