Digital transformation will speed ahead in 2017 and beyond, with companies migrating more of their applications and computing infrastructure to the cloud. At some point, companies in the service industry will be faced with an important decision. What’s the best use of their enterprise time and resources when transitioning technologies to the cloud? What’s the most efficient and effective approach so that an enterprise can take full advantage of what a public, private or hybrid cloud has to offer?

As businesses shift to cloud computing, those that rely on outsourcing models will be well served by revisiting their strategies and best practices with the cloud world in mind.

Take Vertical Slices

One approach that’s proven highly successful is to assign cloud projects by so-called “vertical slices” -- from IT operations all the way to service management of cloud infrastructure. Look at it as outsourcing vertical stacks enables a higher speed of change, while assigning projects by horizontal stacks is engineered for efficiency. A potential disadvantage is that a company may have to consolidate outsourcing from multiple service providers, which could result in some inefficiency initially.

This approach does call for excellent coordination and management of resources. In essence, the right hand always must know what the left hand is doing. Since many of the outsourcing partners may not possess all these skills, an alternative approach could be to carve out the business process from the technology portion.

Call for a Scrum Team

Instead of forklifting a big cloud project in its totality, it may be better to call in scrum teams and break down your project into “scrum pieces.” There’s a proverb: What’s the best way to eat an elephant? One bite at a time. Scrum pieces are handled by smaller project teams that are typically cross-functional and are committed to deliverables – sometimes called story points -- approximately every three to four weeks.

When working with an outsourcing partner on a cloud project with a scrum team approach, results should be output-driven in terms of features and story points per cycle, across the stack. A good scrum team provides the flexibility to adapt to rapidly changing business and market situations typical of cloud technologies.

Changing Role of APIs

APIs are the cornerstone of the customer experience. In today’s changing technology world, APIs are used across the enterprise and cannot be static. Instead, they must be continuously maintained and upgraded, evolving to keep pace with changes in operating environments, as well as regulatory and security requirements.

However, APIs are only enabled by context and data; thus they should be considered apart from applications. API functionality requires a different expertise and should be managed separately. We strongly recommend what is called an “API factory” -- contracted for a particular enterprise, not for a particular function.

Efficiency and resource optimization requires a team that understands enterprise standards and building API-like application management models. A potential disadvantages is that APIs must be created and managed within the context of the entire business. Consequently, any “API factory” should thoroughly understand your specific business and domain or it will not be effective.

Human-centered Design for Global Markets

Human-centered design is at the heart of how the new user interacts with cloud systems. The focus starts with the user and in the cloud world, it is key to ensuring that design drives the technology, and not the other way around.

It’s also important that companies have a global context since the user experience can be quite different across geographies.

For example, the way users in different countries view mobile banking transactions can vary widely. In the U.S., security concerns affect widespread adoption of mobile financial transactions, with many preferring to use a desktop or laptop computer. In countries such as India or Korea or Germany, users are more comfortable and the percentage of mobile transactions is much higher.

These recommendations – taking a vertical approach, using scrum teams, API factories and human-centered design – are best practices that apply to all service industries considering outsourcing cloud functionality.

(About the author: Mritunjay Singh (Munjay) is the executive director and president of the services unit for Persistent Systems. He brings more than 20 years of operations experience at start-ups and large companies in India and abroad in the financial service and insurance, retail and manufacturing industries.)

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