As companies reinvent themselves for the digital age, their leaders need to consider how to integrate their new, more agile cloud organization with their legacy operations.
Companies may need to reengineer their legacy business, but it’s critical to retain the institutional knowledge (and data) on the legacy side while simultaneously developing new skills and strategies for the future.
Achieving the right balance can be challenging and will require operating in new and unfamiliar ways. But leaders who are resolutely forward-looking and who adopt the cloud with conviction can successfully lead their organizations into the future.
How do you make this transition successfully? It requires resolute leadership, strong operational alignment, a clear execution roadmap. But most important, it requires fearless conviction.
Moving to the cloud takes time – in many cases, two to three years. During this critical transition period, a tepid approach or lack of strong operational alignment (i.e., behavior change) can cause a project to stall. It’s critical to have a plan that ensures the legacy organization recognizes the magnitude of the changes ahead.
In a recent survey, 140 executives reported the problems their private clouds faced. Over 30 percent – by far the largest response – said their failure to change their operational model was the primary stumbling block. Clearly, agile clouds need agile processes, and people can either become big supporters or ominous roadblocks on the trail to integration.
Over 30 percent of executives said their failure to change their operational model was the primary stumbling block when moving to cloud.
Operationally, companies need to reconcile their legacy standard operating procedures with the cloud organization’s organic agility. In many cases, that means introducing multi-speed IT strategies and reskilling legacy staff to function in the cloud environment. And because cloud-based innovation projects often shift direction, leaders need effective ways to gauge progress quickly and accurately. Only then can they mitigate issues as they occur.
Towergate, one of Europe’s largest independent insurance intermediaries, shows how to successfully negotiate the challenges of integrating legacy and agile resources.
The company wanted to shift its traditional IT organization to a cloud focus, but faced a significant challenge: Its 300 acquisitions over 20 years resulting in numerous different legacy IT systems and applications. Accenture worked with Microsoft and joint-venture partner Avanade to migrate infrastructure and applications to the public cloud. The initiative focused on four infrastructure areas:
The transformation took less time than anticipated – 12 months – and delivered annual savings of 30 percent, representing savings of about £4 million (US$5 million) per year. In the process, Towergate connected 4,500 employees and effectively integrated all 300 of its acquisitions.
Now with a smarter, faster and better IT platform, the company delivers a far better user experience with new tools, a single service desk, and enhanced self-service capabilities. The cloud transformation also makes collaborating across departments easier, while boosting Towergate’s agility and customer responsiveness.
Perhaps most important, Towergate now has a solid IT foundation that not only can accommodate future acquisitions, but also enables digital and business transformations that will help the business grow.
Our experience at Towergate illustrated a key point: As more companies embrace the cloud to enable innovation and drive profitable growth, they need to make a clear-eyed assessment regarding how to position the cloud organization in the larger enterprise, and what needs to happen, when, to ensure its success.
Three experience-based insights can provide guidance in these areas:
Get serious about the cloud. Train employees in relevant solutions, tools and apps, and make a “cloud first” pledge to plan future innovations with the technology as their base.
Go agile. Create a top-to-bottom agile organization, not just in development but for every area of the company. Manage projects, projects and services in “sprints and scrums” with clearly assigned ownership responsibilities to create urgency and bolster speed.
Get rid of baggage. To reduce IT drag, embark on a lean mission for workloads. For example, tackle “IT-4-IT” projects first and plan to de-commission services the company no longer uses.
Until a company fully integrates its new cloud-based capabilities, the digital platform won’t become the transformational engine that powers the company to digital parity with competitors and provides a springboard to growth.
Read more about adopting cloud with conviction here for details on how to approach the legacy-cloud challenge.