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Organizational Impacts of Cloud Transformation

Teamwork at Mayo Clinic

The Doctors Mayo and Sisters of St. Francis created a unique model of teamwork in service to patients, which continues today.

This is the third in a series of blogs on the subject of cloud transformation. I wanted to start out this blog with a short story from the medical field that illustrates one of the changes that can be expected by any organization moving to cloud. The story is about the Mayo Clinic, which was founded by William Worrall Mayo and Mother Alfred Moes in Rochester, Minnesota.

From the very start, they envisioned a different kind of medical institution. They envisioned an institution that could put a priority on serving the patient. With the patient at the center of everything they did, it forced collaboration between everyone that worked in the clinic. Administration, scientists, surgeons, chemists, nurses, laboratory workers, and more came together to serve a single patient’s needs, from health and mental to spiritual and physical.

This approach to patient care is still the standard, many years later, in Mayo Clinics today. This concept of all disciplines within the clinic collaborating together in a multi-disciplined team that’s focused on a single goal (the patient in the Mayo Clinic’s case) is the core change that will extract the most value out of cloud computing.

Organizations must manage a host of changes when moving to the cloud. These changes will eventually happen to all parts of the organization not just the IT group. Clearly, the IT group will experience some of the most immediate changes resulting from adoption of cloud computing. However, all of the following functional areas of the organization will experience some change:

  • Financial
  • Accounting
  • Marketing
  • Sales
  • Customer support
  • Human capital/resource
  • Board of directors
  • Executive management

There is a significant amount of change that must happen in the financial side of the business. Companies must calculate ROI in a very different way. The focus has shifted to customer-related metrics as opposed to pure money-related metrics. The subscription-based pricing model for most cloud-based services means that the way companies’ IT spending is expensed is different. Capital investments and depreciation doesn’t have the same impact on financial statements as it once did.

Marketing, sales, accounting, and customer support staff will continue to experience change in their daily activities. This change comes both in terms of what and how. Cloud technology has altered the normal patterns of interaction with their current and potential customers. This is thanks to an explosion in the number of “points of contact”. Customers expect everyone in a business to know “ALL” of the history about their interaction with the company. As the company increases their use of tools like AI and cognitive technology, even higher expectations will be set for the customer and their relationship with a company.

Finally HR, board of directors, and leadership teams will be facing a significant expectation gap for their internal customers/employees. This “expectation gap” has already expanded thanks to the high availability of new cloud-based technology and the related capabilities. We see this change on a daily basis with a manpower shortage in high demand skill set areas.

Changing the way these groups reach out and meet the expectations of this internal customer group will become one of the key metrics in the future to determine life or death for the company. Executive leadership teams will face changes in the expectations of their shareholders and board of directors. This group will be comparing the performance of the organization within the context of peer companies that are also leveraging the power of cloud computing. If the peer companies appear to be gaining more market share or eyeballs from new innovative products or services, then it is easy to see how the shareholders and board of directors will have a new set of expectations.

Going back to my story about the Mayo Clinic and the central focus on the patient by everyone in the organization. This focus set a new standard in the medical profession and continues to do so today. As more organizations adopt cloud computing as a “standard”, using cloud computing will not be the competitive edge.

To leverage cloud computing for a competitive edge, all organizations will need to innovate quickly within their specific organizations. Business will need to embrace a new way of doing business for that change. Each organization will need to develop its own “focal point”, and everyone in the organization will need to work together in cross-functional teams to deliver against that focal point. Cloud computing will allow those teams to quickly develop and deliver totally new products and services that exceed their customers’ requirements.

The customers will reward those companies with higher profits and greater market share. Cloud computing provides a technological and financial basis for any organization to redefine how any product or service is conceived and delivered in any industry.

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