How IT Services Companies Can Thrive in the Age of Cloud

Updated: July 12, 2010

But before settling down to Business As Usual model of pre-recession days, IT services companies should look at changing tech landscape and "Clouds" on tech horizon - Cloud Computing that is! In the words of Irving Wladawsky-Berger, "IT is undergoing its biggest changes since the advent of client/server computing in the 1980s. These changes are being driven by many factors, chief amongst them the emergence of a different model of computing - cloud computing. We are entering the Age of the Cloud." (for more, read his excellent blog post titled IT in the Age of the Cloud)

In his post, Irving Wladawsky-Berger has quoted findings of study on The Future of Corporate IT by The Corporate Executive Board. After interviewing and surveying hundreds of IT and business leaders, this study concluded that "The IT function of 2015 will bear little resemblance to its current state. Many activities will devolve to business units, be consolidated with other central functions such as HR and Finance, or be externally sourced. Fewer than 25% of employees currently within IT will remain, while CIOs face the choice of expanding to lead a business shared service group, or seeing their position shrink to managing technology delivery."

The Corporate Executive Board study has further identified five emerging shifts in IT value and role. These are:

  • Shift 1: Information Over Process
  • Shift 2: IT Embedded in Business Services
  • Shift 3: Externalized Service Delivery
  • Shift 4: Greater Business Partner Responsibility
  • Shift 5: Diminished Standalone IT Role

IT Services companies need to prepare for these emerging shifts and incredible opportunity they present by expanding their "Cloud" service offerings.

Unlike product companies, one of the issues many IT service providers (and especially those that operate in the lower end of price spectrum) face is that their revenue is directly linked to "billable" headcount. And to grow their revenue beyond certain point, these companies need to have a "product" or "license" based revenue model rather than "headcount" based model. Cloud computing offers an excellent opportunity for IT services companies to develop service offerings that can be offered to client under Software as a Service(SaaS) model.

Talking specifically about CRM and Social CRM, IT Services companies should extend their CRM and BPO service offering to cloud based services in following areas:

  • Development of Engagement Platforms and Communities
  • Integration of "On-premise" CRM apps with "Cloud based" Social CRM apps for 360 degree "view of customer"
  • Cloud based Social Media Monitoring, Reporting and Analytics
  • Cloud based Social Media and Network Analytics solution

Affiliated Computer Services, a leading service provider recently launched "Community as a Strategy" - a suite of social CRM services that captures customer insights from social media sites to improve service and responsiveness of organizations. Other IT and BPO Service Providers should take notice of this development and follow ACS' lead in this direction.

Featured Research
  • What You Need to Know About VoIP Security

    No matter the industry or area of expertise, a strong VoIP system is the perfect tool for any business looking to take both its internal and external communication to the next level. more

  • Are You Using These 5 VoIP Features?

    In large part, the success of your business depends on the strength and reliability of your team’s many communication networks—this includes your Voice over Internet Protocol system (VoIP). more

  • Video Conferencing Best Practices

    Video conferencing is quickly becoming one of the most important communication channels for both small and big businesses. As more businesses turn to this technology, expectations about the experience are also rising. It’s not enough to just offer video conferencing as a communication method. You also need to meet minimum audio and visual standards, and there’s even proper etiquette to consider. more

  • 10 Contact Center Myths Busted

    For most forward-thinking companies, the use of contact center software is on the rise. That said, in spite of contact center software’s sudden rise in popularity, a number of myths have begun to take shape. more

  • Go Mobile and Increase Employee Productivity

    The Bring Your Own Device (BYOD) and Voice over Internet Protocol (VoIP) tech trends now allow people to work whenever, wherever, and however they want—mobility makes it happen. more