I’m a business executive and I am examining capital expenditure, financing, operating expenditure, total cost of ownership, business operations flexibility and timing. Armed with this information I will decide, “to cloud, or not to cloud.” This is a thought that will pass the mind of many CIOs, CTOs, Operations executives and small business owners in the next few years as the booming cloud becomes a greater part of everyday business. If this is true of you, care is required in making this decision due to the far reaching impacts on your business if you get it wrong.
From a business perspective financial elements are often more important than what most IT leaders may be looking for in a cloud solution, namely, security, ease of scale, flexibility, capabilities, etc. A CIO may be told by the CEO and/or CFO that there is simply no capital available for an on-premise solution but the company is still embedded in 90s technology and the CIO needs to find a way forward. Automatically, the cloud becomes an option but is it always the best option?
Business leaders, let’s turn the light back on you, just a little, though. The reason for a business to go to the cloud today should be a balanced decision, yet more often than not it appears to be driven by the financial side of the fulrum and not the realities of what your business needs to survive. This leads to the question, “how do you prioritize the reasons for a cloud investment over an on-premise solution?” You ability to answer this question could make or break your business. Literally, make it or break it.
How you are addressing prioritization of the business and financial needs is extremely important. If your decision is purely financial, the result could be a less than acceptable customer experience. Why is this relevant? Because some analysts report suggest that companies who are laggards with customer experience do badly in good times and worse in bad times, whereas companies leading the customer experience will perform less badly or even well during bad times! (Forrester, 2009 Customer Experience Index) It is not clear yet how the looming financial depression in Europe will impact North America or if governments globally can stave off another world economic downturn. However, your decision cannot be based on negative future outlook, it must be based on the ability of your business to be competitive and different in order to gain and maintain your profitable customer base. This means truly understanding what is possible, convincing your financial backers to secure the investment funds and driving your business to that outcome.
A rather perverse practice that has become almost a habit in the last few years of ecomonic grief is that companies cut their investment the most, in the place where they can least afford to, the contact centre! Why, in this time of harsh competition and demanding customer expectations, would a business seek to cut investment in their most important point of customer interface?
Don’t respond, “because its expensive”, as that is really a double-edged sword. If you cut the investment in a business operation, without properly examining what you need from it, you stand to reduce its ability to deliver, cutting also its effectiveness and leading to the self-fulfilling prophecy of doom you foresaw before you made the cuts. Honestly, look at history in business, cuts lead to cuts and cuts lead to customer dissatisfaction. Customers who walked away and came back in the past now have much more choice than ever before and even if they do comeback it may be years before they have tried out the competition. It is critical to your business that you take the needed time to analyze the key customer experience elements that bring your customer to your business. In doing so, you will be able to make a much better decision on where excesses exist in your operations. As a salesperson I spend a good deal of time talking to my customers about customer experience, most of them really do know what makes their customer’s tick. Some do not.
Questions that may be useful include, “Am I going to reduce my ability to respond to customer needs flexibly by using a cloud solution?” “Will I have the ability to quickly add what I need for new business contact channels or social media with an on-premise solution?” “How does total cost of ownership factor into my business and operational plans?” “How will this project deployment be accomplished?” “Do I have cloud choices that I can leverage for a future on-premise solution?” “How does the solution under consideration accomplish my business objectives surrounding the contact centre?”
Be willing to take a different look at investment options as if from the outside in. Examine return on investment if you have previously never really done so. Yes, it is possible for a company to be doing well without having reviewed their ROI on purchases but today thats as luxury most businesses can ill afford.
A willingness to examine the options before deciding on a cloud or on-premise decision is a key to success for today’s business and IT leaders.
A note to Sales people: Its important to understand the underlying reasons why a prospect or customer is seeking a cloud solution. Before you prescribe, despite the heavy temptation and pressures upon you, seek first to understand clearly the drivers of the cloud decision. If the executives or IT have already commoditized your solution, this will ultimately end up being largely a financial decision but it could also be influenced by specific business value your solution can bring. Don’t make the mistake of thinking that simply highlighting differentiation will make a difference to the executives considering their options. If you can present your guidance and advice in a manner that truly helps the executive(s) deliver specific business value, you will have a better chance of positioning a more expensive cloud solution and showing your executive contact the business sense.
The difference today is that you MUST understand the industry and you MUST understand your customer/prospect business drivers. The 21st century is not an era for the journeyman sales person looking for a 9-12 month stint to keep the kitty flowing. Rather, its a time for strategic-minded sales people to show their value. Sales is after all about helping to fix a pain whether its discovered or already known, how can you reveal these things if you don’t know your prospect or customer’s business? You will need to invest time if you expect to be rewarded with the listening ear of an executive, or else, hang up your shoes and laptop and move over for sales people who actually care.