Enterprises on the cloud are strategic choices for enterprises facing the future

As more and more enterprises join the ranks of Digital transformation, every enterprise is looking forward to the secondary growth of digitalization. The planning and implementation of "enterprises on the cloud" means the integration and superposition of technological upgrading, organizational upgrading and strategic upgrading for enterprises, and has practical significance for the success of Digital transformation of enterprises.

The impact of digitalization on the organization has extended to the nerve endings. As a true enterprise on the cloud, the transformation process is bound to be bittersweet. Based on years of experience in government and enterprise customer service, we summarized and proposed the "enterprise cloud strategy and development design framework", with the goal of providing a set of theoretical references and methodological guidance for enterprises to carry out cloud Digital transformation, avoiding misunderstandings, and improving the success rate. In the future, we will also continue to focus on the all-round innovation of enterprise organization, talent, consulting and operation, and explore more successful paths in the broader industry Digital transformation.

'Cloud based Enterprise' and 'Cloud based Enterprise' are not a primary school Chinese language question, but rather a cognitive question for enterprises in the digital economy era.

In the 2021 Digital transformation Index of Chinese Enterprises jointly researched and released by the National Industrial Information Security Development Research Center and Accenture Business Research Institute in 2021, it was pointed out that only 16% of 560 enterprises participated in the digital research, and many enterprises did not feel the value of digital transformation. There must be some obstacles between the business and production practices of cloud enterprises, so we have been thinking about what "cloud" means for enterprises?

In the past few years, whether enterprises want to make Digital transformation or go to the cloud is decided by the CIO and CTO in charge of information technology. At that time, most enterprises, including us who provide cloud computing products and services, thought that going to the cloud was a technological choice and regarded it as a continuation of information technology.

However, with the development of cloud computing, we find that more and more top leaders of enterprises in charge of strategy are deeply involved in the Digital transformation of enterprises, and they care about a more complete blueprint on the cloud. Cloud vendors cannot just pack up their bags and leave after selling out the cloud. We must draw a blueprint for our customers and plan a clear digital path.

This prompts us to reconsider, if 'cloud based enterprise' represents a strategic choice, what important aspects it actually includes and what important propositions need to be focused on.

From "Enterprise on Cloud" to "Cloud on Enterprise"

From "enterprise on cloud" to "enterprise on cloud", the role of cloud in enterprise Digital transformation strategy has fundamentally changed

Cloud is the first step of enterprise Digital transformation, which has become the consensus of the industry.

Previously, when we talked about "cloud based enterprise", most of our work was focused on "cloud based enterprise IT infrastructure" and "cloud based application systems". Large enterprises have moved various management systems, production systems, and marketing systems from old computer rooms or independent IDC to the cloud, saving a lot of IT infrastructure construction and operation costs; Small and medium-sized internet companies are moving their core businesses to the cloud, utilizing the dynamic elastic expansion capabilities of the cloud to solve IT bottlenecks during rapid business growth.

In these scenarios, the cloud represents a new mode of use and delivery of IT resources, which has unparalleled economic advantages over traditional IT services. This makes the cloud a new production factor in the Digital transformation of enterprises.

In today's increasingly high digital economy, enterprises need to realize online production, online management, and even connect to a wider range of external social resources through the cloud to realize business flow, goods logistics, capital flow, talent flow, and information flow - so the cloud is not just a computing resource, but a new strategy. As an all time online digital carrier, cloud naturally has the advantage of crossing physical time and space: enterprises are based on cloud, allowing more relevant parties to connect online to form a symbiotic network, which generates a large amount of behavioral interaction data when running. Enterprises use algorithm mining to achieve intelligence, thereby providing infinite possibilities for digital business innovation. In this sense, the cloud has also become a new relations of production in the Digital transformation of enterprises.

From factors of production to relations of production, and then to new productive forces, similar cognitive transformation of technology has also occurred in the electrical era. Combining the history of technology and social development, it can be concluded that each revolutionary technology, on the one hand, will form a tool, a means of production, on the other hand, it will certainly profoundly change all kinds of relations of production.

Electricity and cloud, in addition to being new productivity factors, can also affect other productivity factors, connect with them, and undergo changes. Based on these considerations, we believe that our understanding of cloud should be elevated to a socio-economic perspective.

In the past five years, the average annual growth rate of China's digital economy has reached 16.6%, twice the average GDP growth rate, with a scale of 39.2 trillion yuan, accounting for 38.6% of GDP. Even under the combined impact of the COVID-19 and the global economic downturn in 2020, China's digital economy will still maintain a high growth rate of 9.7%, more than three times the GDP growth rate in the same period (ICT Institute's 2021 White Paper on the Digital Economy). The digital economy has become an important engine and key driving force for China's medium to long-term stable economic growth, and the era of the digital economy has officially arrived.

The rapid development of the digital economy is also driving enterprises to accelerate their entry into the "deep-water area" of Digital transformation: not only to achieve the supporting requirements of enterprise IT architecture upgrading, but also to achieve the development requirements of business remodeling, cost reduction and efficiency increase, and to find new business growth models. At the same time, it is also necessary to meet the constraints of security and compliance, risk management, green development and other aspects.

For enterprises, today's Digital transformation is no longer a question of "whether or not", but the speed of transformation is "fast" and "slow", and the quality of transformation is "high" and "low", which determine the success or failure of enterprises in this wave of digital economy.

Establishing the concept of "indigenous people" in the digital economy era

The process of transitioning from "cloud based enterprises" to "cloud based enterprises" is often not easy, and it is also the evolutionary path of enterprises from "immigrants" to "indigenous people". Data shows that only about 20% of traditional enterprises have successfully transformed. Traditional enterprise transformation often faces the following misconceptions:

Mistake 1: equate the application of digital technology with Digital transformation

Gartner predicts that by 2025, 85% of enterprises and organizations will adopt the "cloud first" principle and have a strong willingness to go to the cloud. However, many enterprise leaders lack a holistic view of cloud. They believe that providing enterprises with better IT resources and advanced technology platforms through "cloud" is Digital transformation. They do not realize that Digital transformation should be combined with the enterprise's overall strategy, key business development and business value, which is an all-round change in enterprise philosophy, strategy, organization, operation, etc.

Mistake 2: Lack of systematic guarantee for the implementation of transformation strategy

There is a very clear boundary between the traditional enterprise information department and the business department. The information department is often only responsible for the availability of IT resources and business systems, with little involvement in business planning and only responsible for "digitization" rather than "transformation"; Even business departments with transformation requirements lack effective organizational, talent, assessment and incentive mechanisms, resulting in insufficient scientific and global planning and implementation path design. For example, consider which business transformation is a "one-way door", which business transformation is a "revolving door", and need to design failure fallback paths.

Mistake 3: Neglecting sustainable development while using "going to the cloud" as the endpoint

Most IT leaders in enterprises believe that building the cloud and "moving" applications to the cloud reflect the "explicit success" of technical work, without realizing that "going to the cloud" is not the end point, and the following three actions are the key: first, how to make ecological collaborative development more smooth on the cloud, and second, how to ensure the precise matching of cloud resource supply and demand and ensure resource utilization efficiency, The third is how to legally and legally promote the aggregation of enterprise data on the cloud and its flow as a production factor. These are all key factors for the cloud to continuously unleash value and support business transformation.

Draw a map of enterprise cloud strategy

Based on years of government and enterprise customer service experience, we summarized and proposed the "Enterprise Cloud Strategy and Development Design Framework", with the goal of providing a set of methodological references for enterprises to carry out cloud Digital transformation, avoiding misunderstandings and improving the success rate. Including the following five key elements:

Strategically, it is important to closely link 'cloud' with the formulation and implementation of enterprise business strategies

Firstly, 'cloud' is an important basis for enterprise strategy formulation. The essence of strategy is to solve development problems. In the era of the digital economy, "speed+disruption" makes enterprise development opportunities full of uncertainty. Sometimes relying solely on "people" to see strategy is unclear. At this time, it is necessary to use the "relationship network" and accumulated data "on the cloud" to help enterprises see many unclear customer needs and business opportunities, and thus make more deterministic strategies. It can be said that wherever enterprises extend the value boundary of "cloud", the future development map of enterprises will go.

Secondly, cloud is the key undertaking for the implementation of enterprise strategy. Enterprise strategy is a top-down design and dismantling, with cloud strategy closely matched and carried. Here, three key actions need to be taken: firstly, to define the position of Jiao Yun in the enterprise strategy, and define the phased goals of the cloud in terms of capability level and value creation; The second is to identify key opportunities and value scenarios for business cloudization, define key achievements and revenue indicators for business cloudization; The third is to choose cloud architecture and technology roadmap, and make evaluation decisions from a strategic perspective based on factors such as development, value creation, competition, cost, and technology self research.

A leading domestic car company has been implementing cloud and Digital transformation since 2016, but digitalization has always been unable to focus on business objectives and results. In 2021, the cloud consulting planning project was launched to break down the enterprise strategy in four aspects of "group governance and globalization", "global trendy brand products", "cognitive intelligence", and "green carbon neutrality". Through dozens of joint surveys of technology departments and business departments, it was refined to specific strategies such as "four connections" (external users, internal users, suppliers, and equipment), "three connections" (design and development, supply chain, and marketing), And implement it in all aspects of cloud construction, use, management, and operation. Based on the current situation, a "cloud capability maturity assessment" was conducted on the enterprise, identifying 10 gaps and clarifying 26 key tasks for the next step of "cloud based enterprise" construction.

In terms of organization, it is necessary to promote the Digital transformation of people and institutions

The Digital transformation of enterprises is primarily the transformation of people. Before going to the cloud, the enterprise had various development, testing, and operation personnel. After going to the cloud, will these original positions and personnel continue to exist? What are the changes in work methods and competency requirements? What new positions need to be established? At the organizational design level, it is crucial to think clearly and do two things well:

One is the optimization of cloud governance organization. Cloud transformation is a new thing that is prone to situations where "small things are decided by multiple leaders, and big things are not decided by anyone". Enterprises should sort out the interests and demands of various stakeholders in cloud construction, application, management, and operation and maintenance work, construct a responsibility matrix for cloud matters, and optimize the organizational structure, decision-making mechanism, and process of cloud technology decision-making. The earlier these matters are determined, the better.

The second is the design of cloud talent development. Traditional enterprises often adopt a hierarchical system oriented towards a large division of labor, which requires efficiency and specialized expertise; Today's Digital transformation of enterprises requires innovation, and what is more lacking is all-round talents to do things right. Enterprises need to reconsider their talent requirements and develop new positions, carry out a series of actions such as building a knowledge collaboration system, enhancing personnel capabilities, and collaborating and introducing external talents.

Lushang Group, under the pressure of the epidemic, started Digital transformation. The chairman personally took the lead as the leader of the Digital transformation leading group. With organizational guarantee, all industry sectors and secondary companies cooperated very well, and more business units actively requested to participate in the implementation of the second phase project. In addition, the group has also undergone organizational changes on the basis of the original information center, establishing a new big data center. The main work of the original information center was operation and maintenance support, but now the big data center is more closely integrated with the business, and personnel are also drawn from various business sectors, not only possessing technical skills but also business thinking. In this way, big data centers gradually emerge from the backend to the middle stage, utilizing data to provide strong business support for frontline departments.

In terms of business, we need to achieve business innovation and cloud "integrated" growth

Firstly, for traditional enterprises, digitization is a form of reengineering rather than improvement. Because traditional enterprise businesses are mostly steady-state businesses with clear responsibilities and fixed processes, in the digital era, the production, marketing, operation, and management models of enterprises have undergone significant changes due to the full utilization of the new element of "data". The business innovation scenarios we see today include global marketing, live streaming with goods, Internet of Things, QR code payment, digital factories, industrial connectivity, and intelligent decision-making, all of which are reconstruction of past stable businesses. While Internet enterprises are born with "cloud gene" and "data gene", and most of their businesses are "grown" from the cloud with data as raw material. The Digital transformation of enterprises is primarily the transformation of people. The key is to do two things well: first, optimize cloud governance organizations; The second is the design of cloud talent development. Today's Digital transformation of enterprises requires innovation, and what is more lacking is all-round talents. Doing things right has its own digital original characteristics, fast and flexible. So for traditional enterprises, it is necessary to firmly promote the cloud of core business data, connect more data, achieve data closed-loop, and create new digital businesses through reconstruction. Only in this way can enterprises fundamentally enhance their competitiveness and be reborn in nirvana.

On the basis of its core business development, we adhere to the overall transformation strategy of "establishing an online connection between physical retail and global consumers, and driving the comprehensive digitization of human and freight yards with big data". Through the construction of cloud data platforms, we have opened up 29 business frontends, precipitated core data assets such as over 16 million members, 100000 stores, and 30000 shopping guides, and comprehensively achieved the goals of data standardization, assetization, value, and service, Provided cloud data support for the group's omnichannel digital marketing, refined operation of terminal stores, and improvement of customer service system. Today, the company has become a leader in the Chinese dairy industry in terms of sales performance and brand influence.

Technically, key business problems should be solved through the progressiveness of cloud native technology

1. Cloud native distributed architecture enables rapid collaboration between enterprises across regions and businesses

A large power grid company adopts proprietary cloud deployment during the cloud platform planning and design stages, and the overall architecture adopts the "one cloud multiple regions (regions)" deployment model, which can meet the unified management and control requirements of the headquarters and also meet the needs of provincial-level self operation and self maintenance. Based on this architecture, we will build a cloud for both the internal and external networks of the entire company, forming an "IT resource service center" and a "data service center", achieving "two-level collaboration" in operation and maintenance, and solidifying the company's digital foundation.

2. Cloud native high reliability provides solid guarantee for business continuity

A certain road network center bears the heavy responsibility of canceling cross provincial toll stations and achieving cross provincial unified settlement system construction on national highways, with high social responsibility and high business pressure. The center uses the cloud native distributed database PolarDB-X with 128 data nodes as the main database platform, supporting real-time data storage and processing for 29 provincial data centers across the country, 25000 sets of gantry racks, and 226 million ETC users. The database supports over one billion incremental data per day, with a transaction write volume of up to 45000 transactions per second. In the first week of station withdrawal from January 1st to 7th, 2020, toll stations with congestion and slow traffic exceeding 500 meters nationwide decreased by 18% compared to the same period last year. We have achieved nationwide high-speed daily cost settlement and invoice matching, ensuring high reliability of our business.

3. Cloud native development technology to accelerate the cloudization of enterprise applications

Enterprise business needs to be more flexible and diverse, and application development needs to be more agile. Cloud native development is a system established based on technologies such as containers, microservices, DevOps, and low code. From various stages such as technical architecture, development, testing, deployment, and operation, it enables enterprises to quickly build truly "cloud native applications" that are born in response to the cloud, maximizing the advantages of the cloud. The founder of a medical packaging production enterprise in Hebei led his executives to build an order system, ERP system, quality analysis system, and equipment management system based on a cloud based low code development platform. The implementation cost only tens of thousands of yuan for about three months, achieving the effect of easier data integration and higher usage efficiency.

In terms of operation, we must adhere to the equal importance of cloud security operation and data operation

1. Automation and intelligence of cloud operation and maintenance

After the enterprise goes to the cloud, the focus of operation and maintenance work has shifted from maintaining the stability and reliability of the computer room hardware to facing the entire digital business scenario, including massive data processing, high concurrency connections, real-time data transmission, heterogeneous system calls, and so on. It is almost impossible to complete manual operation and maintenance. At this point, the key to cloud operation and maintenance is how to transition from manual to automated and intelligent.

After a logistics enterprise went live on the cloud in 2019, it not only achieved automated management of daily system operation and maintenance, but also developed an operation and maintenance escort plan during the peak period of "Double 11" traffic. Before the arrival of "Double 11", the operation and maintenance team completed three rounds of full link pressure testing for all 12 business scenarios, and developed more than ten emergency plans for core business scenarios, such as traffic protection, elastic expansion, ECS abnormal migration, and database switching; During the "Double 11" period, the success rate and response efficiency of chargebacks were monitored in real-time through the business market, and the water level of core business resources was monitored in real-time through the resource market, ultimately ensuring 100% availability of the core system.

2. Standardization and scientificization of cloud operations

Cloud operations refer to all management activities that occur after the cloud is launched and put into use, including the application, subscription, consumption, billing, monitoring, reporting, and other aspects of cloud services. The core of cloud operation is to do three things well: firstly, the cloud service catalog and service level agreement must be standardized and sorted out, and visualized to users. This is an important contract between cloud supply and demand; Secondly, cloud resource measurement, billing, and financial accounting mechanisms should be scientifically formulated to promote the green and reasonable use of various resources, improve cloud resource utilization, and avoid waste; The third is to combine cloud operations with business operation indicators, and provide insights into business changes based on changes in cloud resources, providing a reference basis for business decision-making.

Epilogue

As more and more enterprises join the tide of Digital transformation, every enterprise is looking forward to the secondary growth of digitalization. The planning and implementation of "enterprises on the cloud" means the integration and superposition of technological upgrading, organizational upgrading and strategic upgrading for enterprises, and has a decisive basic value for the success of Digital transformation of enterprises.

The impact of digitalization on the organization has extended to the nerve endings. As a true enterprise on the cloud, the transformation process is bound to be bittersweet. We will also continue to follow the guidance of "enterprise cloud strategy and development design framework", focus on the all-round innovation of the enterprise's organization, talent, consulting and operation, and explore the road to success in the broader industry Digital transformation.