Digital Transformation (DX) is now a priority for technology leaders. If you don’t believe me, just take a look at what they’re buying.
According to Gartner, enterprise spending on Information Technology (IT) products and services in Australia is expected to reach almost $93 billion this year (an increase of 3.5% from 2018).
It reflects a shift from an ownership model to a service model (across every industry segment). In other words, Gartner’s findings signal an increased use of “pay for use” cloud computing services instead of investing more resources in hardware and maintenance for on-premise data centres.
Cloud and edge computing has become the approach that helps companies better prepare for the future and sustain rapid changes that epitomise digitally transformed enterprises.
What is DX?
When the idea of DX first emerged about five years ago, it was predominantly technology-centric. Today, DX represents the evolving pursuit of innovative and agile business and operational models.
According to Brian Solis, futurist, keynote speaker, and best-selling author, DX is also driven by evolving technologies, big data and analytics, reimagined business process, and a talented workforce that strives to create new value and experiences for all stakeholders.
It makes sense as DX technologies like cloud computing help companies become more agile, improve collaboration, and communication. It also enables smart business decisions and the accommodation of remote workers.
What is Cloud Computing?
Cloud computing is a term that describes the delivery of computing services (like analytics, business intelligence, databases, networking, servers, and software) over the Internet to enable rapid innovation, economies of scale, and flexible resources.
When it comes to working on the cloud, companies only pay for the cloud services they use. This approach helps businesses run their infrastructure more efficiently while significantly lowering operating costs. It’s also an approach that helps business scale their operations up or down as needed.
The cloud services model represents a move away from storing, managing, and processing data on a personal computer or “local” on-premise server. Small-and-medium-sized-enterprises (SMEs) which decide to move up to the cloud also gain immediate access to cutting-edge technology, cost-effectively.
The cloud can take three different forms:
- Public Cloud (where established third-party providers deliver services hosted in the cloud)
- Private Cloud (where cloud services are delivered exclusively by a single company or on-premise data centre)
- Hybrid Cloud (where enterprises can leverage both public and private environments)
Cloud computing was a catalyst behind the following cloud computing services categories:
- Software as a Service (SaaS)
- Infrastructure as a Service (IaaS)
- Platform as a Service (PaaS)
Key benefits of cloud computing include the following:
- Enhanced data security
- Improved performance
- Scalability (following a pay-per-use model)
What is Edge Computing?
Edge computing can be described as a distributed, open IT architecture that is designed to decentralise processing power, accommodate the Internet of Things (IoT), and mobile computing.
Edge computing solutions focus on processing data at the edge of enterprise cloud networks, where it’s being generated. This approach helps organisations leverage speed and agility because the data isn’t centralised in a data-processing warehouse.
In other words, edge computing ensures that the data is processed by a local computer, server, or the device itself (rather than transferring raw data to a warehouse). So organisations that leverage this technology can engage in real-time data and analytics and customer engagement.
What’s the Role of the Cloud/Edge Computing in DX?
Engaging in data and analytics on “the edge” helps companies realise the full potential of DX. Edge computing solutions, for example, enables digitally transformed organisations make the most of the data generated by IoT devices and sensors by engaging in edge analytics in real-time.
It’s an effective response to the cloud’s inability to efficiently support minimal latency, disconnected operation, or massive data and computation.
IoT and edge computing are proving to be popular among customer-facing brick and mortar retailers, restaurants, and hospitality operators because it enables the delivery of content-rich experiences (including self-services and cashier-less checkout).
It also helps businesses gain a competitive advantage in real-time by leveraging Artificial Intelligence (AI) and Machine Learning (ML) applications. Companies that include edge computing in their DX journey will be well-placed to take advantage of next-generation IoT platforms.
Whenever companies are engaging in edge cloud computing, they will be much “smarter” than businesses of yesteryear. They will be transformed into “intelligent enterprises” that boast the following key benefits:
- Augmented Reality (AR)/Virtual Reality (VR) media engagement
- Cost savings
- Enhanced reliability
- Improved automation
- Increased security
- Low latency
- Real-time customer engagement
- Reduced bandwidth
Edge computing also helps organisations make efficient use of IoT to cut costs and save energy. If we take the Melbourne Cricket Ground (MCG), for example, the largest stadium in the Southern Hemisphere was able to reduce its energy consumption by as much as 55% per patron.
When you consider the stadium’s capacity of over 100,000, cost-savings on utilities quickly add up. The MCG was also able to reduce its overall carbon emissions by 17%. All this was made possible by leveraging IoT focused digital transformation.
What Are the Challenges?
DX driven by cloud and edge computing is a necessary disruption for businesses of all sizes. However, successful deployment of DX initiatives is no easy feat. This is because replacing legacy hardware and software can be time and resource-intensive.
Businesses will also have to deal with the significant shortage of top tech talent. The time it takes to bridge the talent gap can also increase your risk exposure to business irrelevance.
The solution to this on-going problem is to partner with an established third-party cloud computing services provider.
It’s the only approach that helps SMEs take advantage of past DX experiences, a large pool of top tech talent, and cutting-edge technology, cost-effectively.
To learn more about how cloud and edge computing drive successful digital transformation, and create real business value, reach out to one of our local experts today.