Only 20% companies can be called Cloud Champions in APAC: Ryoji-Sekido of Accenture

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Covid-19 gave a turning point to many entrepreneurs and organizations that either contributed to their success or to their failure. For those who succeeded saw tasted the fruits of their experiments and those who failed learnt a new lesson in management. One such important make or break concept was Cloud Technology. Those who were able to implement it before the outbreak made it into a story of triumph and those who could not, broke out into a new thesis on business innovation.

According to a recent study from Accenture, companies are yet to achieve their full value realization even though they have consistently been investing in Cloud technology. It is observed that most companies in APAC are not using the power of cloud for new innovations in their offerings or business processes.

We talk to Ryoji-Sekido, Senior Managing Director, Accenture Technology Lead for Japan, China, Asia Pacific, Africa and Middle East and Executive Vice President, Accenture Japan Ltd to understand the challenges enterprises are facing in adopting the Cloud platform and leveraging it to the fullest. Here is an excerpt of that interaction-

Kindly share your views on the initial challenges and the growth of the cloud market across Asia. Can you draw any comparison or similarities with the growth occurring in the US market?

In general, most organisations struggle to realise the full business value from their cloud initiatives due to the immense complexities involved in successfully executing cloud migrations. Our research in the latest ‘Business In The Cloud’ report suggests that few organisations across Asia Pacific have adopted the full spectrum of cloud capabilities. Notably, only 20% of companies are true “Cloud champions” – organisations that have adopted the cloud technologies needed to migrate, accelerate and grow their businesses and have learnt how to apply these technologies in their core business functions such as marketing and sales, among others.

Can you share one example of successful Cloud Technology adoption in Asia? 

Within Asia, Accenture has been working with Japanese mobile telecoms business Rakuten Mobile. By leveraging cloud, Rakuten Mobile was able to build an innovative solution that helped significantly lower its operating costs and create new revenue-generating streams. This innovative solution comprised of creating a fully virtualised mobile network. Working with Accenture, Rakuten Mobile was able to automate its radio network’s function and maintenance, which is typically used to transmit the mobile signal from the mobile phone’s antenna to the tower. Instead of deploying hardware that needs regular maintenance at the physical location where multiple mobile towers are located, Rakuten Mobile connected its antennas to a cable that controls multiple sites, thereby virtualizing its radio network.

What are the benefits of a cloud-first approach in the business process? Can you cite some examples of business organizations that have implemented it. 

Transformation is the new normal and this is why many organisations are reimagining their businesses by migrating systems and applications to the cloud. We see this in how organizations are pivoting to cloud to innovate. For example,  Siemens chose to proceed with a multi-cloud, best-of-breed approach to provide engineering and manufacturing companies with data from their factories. By working with multiple cloud providers to broaden the choice of platforms and investing in advanced sets of capabilities across those providers, they were able to optimise and improve manufacturing continually. Today, Siemens’ multi-cloud strategy allows it to offer a range of cloud-based solutions to bring greater efficiency and cost savings across their machines and processes.

Cloud is also important in other areas of business functions, such as HR. Take our work with HSBC for example. With Accenture’s extensive experience in HR, HR technology, change management and digital transformation, we partnered with HSBC to revamp their employee experiences. Legacy HR performance and compensation systems were replaced with an integrated, cloud-based HR software application to empower the workforce and drive greater value for customers and shareholders. HSBC’s new cloud-based HR technology allows it to focus on services and innovation rather than expensive and complex maintenance and upgrades to legacy, on-premise technology.

What is Accenture’s 2021 FinTech Innovation Lab all about? 

The FinTech Innovation Lab Asia-Pacific is a highly competitive, 12-week programme that helps early to growth-stage enterprise technology companies refine and test their value proposition with the support of the world’s leading financial service firms. This year, 11 leading FinTech firms were chosen whose services ranged from AI solutions and blockchain technology to cloud-based platforms to enhance work processes and operations.

The Lab will help bolster efforts to help banks, insurers and payments firms improve how they operate and serve customers. This comes at an important time as banks begin to re-think their operations. Accenture’s research found that a one-position climb in operational maturity can lead to a projected 17 percent increase in global profits — and the key to leapfrogging maturity levels is the establishment of new ecosystem relationships. Ecosystem partnerships would enable banks to retain their core operational systems and processes while simultaneously building stable partnerships, receiving transformed services, reducing costs and accelerating the transformation journey. This collaborative approach lends established banks relevance and innovation while giving fintech start-ups decades of trust, customer loyalty, and, ultimately, security for their users.

With the FinTech Innovation Lab launch in Asia Pacific, firms will have access to coaching, mentorship, and networks with senior executives and leading financial institutions to accelerate their business growth and increase their visibility within the industry.

What has been the biggest challenge or hurdle in your quest for digital transformation across Asia? 

Our research shows that there are barriers preventing APAC organisations from fully achieving their value for cloud – and subsequently their quest for digital transformation.  These top three barriers are: legacy infrastructure and application sprawl, a misalignment between IT and business and lastly, data sovereignty concerns and regulations. Perhaps most concerning is the trend around “misalignment between IT and the business”. This is a fundamental requirement to cloud success and yet it appears to be a major concern for many APAC organisations. It is also potentially the most destructive barrier to value. As complexity increases, alignment on goals and the full breadth of what’s needed to achieve them is even more important for businesses to derive cloud value.

Additionally, the reality is that many CEOs are not effectively building a bridge between their business growth ambitions and the magnitude of change needed in order to embrace new ways of working that are enabled by cloud. Becoming Cloud First is an essential component of the digital transformation journey and CEOs need to start realising the efficiency gains from running their IT operations differently, building on the momentum of cloud adoption to drive greater benefits for the organisation.

According to your observations, which countries have proven to be the frontrunners for digital transformation in Asia? What are the initiatives taken by the respective governments to promote faster digitalisation? 

We’ve seen digital transformation accelerating across Asia with the help of government policies. Singapore is a good example especially with its Digital Health Passport, which lets individuals store medical documents in a secure digital wallet. In the first wave of the pandemic, the system allowed the government to easily track the levels of infection and eliminated the need for paper records. It also gave public and private healthcare providers as well as individuals access to verifiable test results and hospital discharge papers for work clearance. In other words, it put a clean and trusted bill of health right at everyone’s fingertips — and was used more than 1.5 million times in its first four months alone.

Initiatives like these have shown how technology has been a lifeline that sustained us through the pandemic, and how it is redefining our reality by pushing a giant fast forward button to the future.

What is your impression about the post-pandemic market in the financial, IT, hospitality, agriculture, manufacturing and banking sectors? How is AI and cloud tech affecting them and boosting them in the coming months?

Covid-19 has undoubtedly given new urgency to the cloud imperative across many industries. It has spurred the region’s digital transformation journey and the option of public or a hybrid cloud approach is becoming increasingly attractive for many organisations. Regardless of industry, the cloud will enable rapid scale transformation while simultaneously eliminating barriers for entering new markets. This is because cloud offers the potential to turn underutilised intangible assets (e.g, behavioural data driving customised offerings) into financial value for both customers and the business.

Additionally, cloud-led programs are modern tools of strategic, broad-based organisational change. This incremental-release approach involving new cloud capabilities focused on unlocking tangible value in specific business functions can help organisations build confidence and boost them in months, before they “go all in” with their multi-year cloud commitments. With the acceleration of digital transformations, the cloud is set to help all organisations lead by outmanoeuvring uncertainty and help drive profound changes in how organisations operate and compete to create value for all its stakeholders.

This article is based on an email interaction with Accenture leadership 

Compiled by Ujal Nair

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