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Cloud Adoption – Walking the line between buying cloud and consuming it

Matt Hoppe

As an industry, we present quite the oxymoron to a buyer when a technology stack has been designed that offers the flexibility to be built dynamically, scale on demand, be turned on and off automatically and critically be billed on actual consumption, whilst at the same time having the vendor, reseller and salesperson wanting to get paid up front in one hit…

So, what do you do when you have designed a technology stack and it’s consumption to meet your business challenges, and then get given the dilemma of maybe having a couple of extra points knocked off the price if you pay for 1 year upfront? Hell, I will discount even more off if you buy all 3 years today.

I work at Xtravirt, a cloud consulting and managed services business. We’ve met the challenges of cloud adoption and other technologies numerous times over the last few years, both because our vendor partners level up their commercial offerings and terms to be ‘in sync with the market/competition’ and yet still have the challenge of hitting sales revenue and profit targets on an annual, quarterly and even monthly basis.

My team works hard to identify technical solutions to the business challenges that our customers ask us about every day, and inevitably (and it is inevitable), see the solution scope and value be eroded as soon as it comes to commercial terms. When it comes to reconciling these challenges, here are some of the lessons we’ve learned.

Cross-functional collaboration is essential

It is critical that discussions involve key stakeholders from different business functions. While budgets can be issued, the choices in spend profile of that budget as well as how the budget is issued all come together with the financial options available on technologies today. Are you looking at a capex spend or does opex work better? Is the usage of IT functions seasonal? Is the business looking at intrinsic or structural change? What risk profile is acceptable? How important is the speed of agility, not just from a Recovery Time Objective (RTO) perspective but also for expansion, or time to market challenges?

Know the value drivers

Establishing the value of a solution has always been the goal, but does the value align to a technical use case, a financial one or both? Typically, we see IT departments desiring the correct technology while finance are typically driven to the best deal or price structure. The reality is that you can drive these objectives in parallel.

Define the value and measure it

The delivery profile of the transformation has multiple facets. Engagement and recognition of value of each facet needs to be identified, highlighted, and established as a success criteria, particularly when aligned to the value statements originally made in any business case.

When Xtravirt engage with an organisation and our conversation relates to resolving or meeting a business challenge, then early conversations with stakeholders are important. In fact, today, these cross-discipline conversations are built into our discovery process as standard practice. In sales, we often say that selling the benefit to a person, is more valuable than selling the benefit to a business, which in turn is always more valuable than selling a feature or benefit of a product. With more complex and ultimately more valuable products, platforms and technologies coming into the market place, we need to recognise that you need to sell to, or engage with all of the people, to all of the business, and with products, platforms and technologies that can cater for all of the use cases.

In turn, working with the supplier chain also assists in homing in on the right commercial model. Accessing all the stakeholders, from your reseller, to maybe the distributor and building a relationship with the Vendor can bring the win-win that will make the engagement more successful. It sounds cliché, but every organisation involved in the digital transformation or project that you are interested in is keen to make sure you get the value out of what you buy.

If you can do that, then you are sure to drive the most efficient commercial model that is suitable for your organisation.

If you’d like to know more about how Xtravirt are accelerating organisations through their digital transformation programmes and enabling them to reach their intended business outcomes, then drop an email to info@xtravirt.com and let’s start a conversation.

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