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Workplace Collaboration through the Cloud Fundamentally Changes the Business Model

8 Oct 2014 by Teresa Meek

We are in the midst of a workplace revolution.

It’s not a political revolution and no armed forces are involved. Rather, it’s a collaboration revolution, and it will change the way the world does business.

The last century was dominated by large companies that built for economies of scale to deliver very large quantities of goods. [1:49] The system created millions of jobs and put many affordable and convenient manufactured products into the hands of consumers for the first time. But the model needs to change.

“The only problem is, it doesn’t work anymore,” Dan Levin, the COO of Box told an audience at the 2013 Insight-sponsored CloudCast 2014 conference. “The barriers that those companies created are falling.” [2:11]

Old-style companies like Borders, Blockbuster, and Kodak are dead, destroyed by companies that learned to leverage information and collaboration. [3:29] We are now in the “information economy age,” which will be not about scale and process, but about information and collaboration. [3:55]

The new order changes the role of IT in organizations. When the workplace becomes virtualized and companies outsource to a worldwide labor market for cost and efficiency, when customers and partners are scattered across the globe, information is no longer about enterprise resource planning, the back office, and the PC help desk. It’s about driving the engine of competitiveness in the business. [4:09]

Back in the mainframe days, life for the IT department was simple. It was a matter of putting in air conditioning and flooring, then negotiating a contract with one of a handful of large companies, like Oracle or Microsoft.

Next, we moved into the PC era with client servers, but the role of the CIO and the IT team didn’t change much. It was still about enabling capabilities that were focused not on the end customer or on value creation, but on colleagues who created the value.

In the new mobile-centric, post-PC world, the role of IT will change.

“In 20 years, there aren’t going to be any data centers…They’re going away,” Levin said. [6:30] There will be no competitive advantage to running a data center, because other people will be doing the job better and deliver a more secure service than a business organization is capable of doing. [7:13]

The move to the cloud is changing everything about the way we work. [8:26] We’re bringing in new devices and sharing information in ways that were impossible in the past. For example, if you forget to bring your PowerPoint deck to a conference, it’s no big deal anymore—you can access it from the internet on your phone or tablet instead. Information is available whenever and wherever you want.

The new model of workplace accessibility and collaboration breaks down the old management structure and moves us to a flatter system. [9:48] It’s a system where there’s no 9 to 5; for better or worse, we’re always working. Technology is no longer enabling value creation, it is value creation.

Look around the modern workplace. At hospitals, doctors no longer walk around with clipboards—they use iPads so they can get immediate access to electronic health records, images, and maybe instructions on using equipment. It’s all HIPAA-compliant, and they aren’t experiencing the massive security breaches that occurred in the past.

At Bechtel, the country’s largest equipment rental company, most of the workers wear hardhats and boots—and carry iPods. [12:28] In the past, they carried clipboards and took notes, then every Friday, they spent part of the work day transferring the hand-written notes to a computer. Now, their productivity has improved 20%. [13:30] Mobile technology not only helps internally, it boosts sales. The company knows off the bat what you bought or rented the last time. It’s killing the competition.

Netflix is another example of collaboration being used to increase a business’s competitiveness. [15:46]. When they create a new show, TV studios offer viewers a pilot. Most series get cancelled, because the studios are not giving the audience what it wants.

Netflix knows what its audience wants. It knows everything they’ve ever watched. So it can pick a segment of the audience and design a show specifically for them, like Orange Is the New Black or House of Cards. And they’re hits! The television industry is shaking in its boots. [16:01] It’s not because Netflix has better producers, directors, cameras, or production values—they don’t. It’s because they know how to use shared information to tailor their product to the audience.

GE is starting to do the same thing with its industrial businesses. Pearson is doing it with education.

The use of information technology to create competitiveness is going to change everything about the way we work. [16:45]

And it’s going to require a change in the way the IT department thinks and behaves. [16:54] The new system puts the user at the center.

Workers are going to find ways to access their company’s information remotely, whether IT people want them to or not. Consumer tools have no permissions, no reporting, no way to do document retention, no way to deal with data loss. [19:44] You may not like this system, but you will be dragged into it by workers trying to do their jobs.

Instead of fighting them, find ways to help them. If you put colleagues at the center and help them solve problems in a safer way, everyone will be better off. And the cloud is the key enabler of that. [20:26]

Gartner predicts that by 2016, the bulk of new IT spending will be for cloud computing platforms and applications, and nearly half of large enterprises will have cloud deployments by 2017. [20:42]

In the beginning, the cloud was about tactics—improving costs and efficiencies. Now, competitiveness is the main driver.

Information sits at the center of your business. [29:29] Knowledge used to be power. Now, sharing and collaboration are power. [23:59] Hoarding information and keeping it to yourself doesn’t work in the modern era.

The cloud makes the new paradigm of fast innovation and customer-centered business possible. But it only works if the cloud vendor supports open architectures with open APIs and “plays nicely” with the rest of the cloud ecosystem. You should expect cloud vendors to be much more agile and responsive to meeting your needs. [25:52]

The cloud is not just about storage efficiency anymore. It’s much more fundamental than that. The mission of the cloud is to make businesses more productive, competitive, and collaborative by connecting people and their information. [26:59]