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Smarter Commerce | April 16, 2014

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Cloud First: Has SaaS adoption reached a tipping point?

Armen Najarian

Recently, I had the honor of appearing on a live webcast moderated by Jeff Kaplan, recognized cloud analyst and founder of the Cloud Computing Showplace, and featuring Jeremie Davis, IS Director with Danone North America – the NA division of French-based Groupe Danone.  The fireside chat format made for a lively discussion on a number of key cloud-focused themes including accelerating innovation, the role of business vs. IT leadership in SaaS (Software as a Service) adoption, and streamlining time to value.  You can access a replay of the webcast here.

During the webcast, one of the comments in particular that Jeremie Davis made stuck with me.  To paraphrase, Groupe Danone has embraced a “Cloud First” strategy for most business processes, leveraging cloud solutions and Software as a Service wherever possible.  To me, this is significant on two levels:

  1. Groupe Danone is a very large, very established, multi-national organization managing high volumes of sensitive customer, sales, and financial data.  Migrating their core business processes to the cloud is no small task.  And, along with that comes several big policy, security, and public perception implications to consider and manage.
  2. The Cloud First strategy is barely three years in the making, yet Groupe Danone has made tremendous strides.  Their pace of cloud adoption is impressive.  They have already embraced a number of SaaS applications (from IBM and other vendors) such as procurement, pricing and promotion analytics, global expense reporting, and email and collaboration services, among other capabilities.

Jeremie further described a culture of collaboration and trust between IT and line-of-business leadership that help make Danone’s Cloud First strategy possible.  In particular, he painted a picture of Danone IT leadership as progressive and open, serving as an advocate for business acceleration enabled through IT, rather than a roadblock for innovation.  This modern IT leadership philosophy is what I described as the “evolved CIO” during the webcast.  I view this as one key, necessary ingredient for large multinationals like Danone to embrace cloud so aggressively.

As I mulled this over further, I concluded that strategies like “Cloud First” allow companies to work smarter and ultimately serve the customer better.  In the case of Danone, the speed with which teams can realign around marketing processes in the cloud, for example, have positive downsteam effects.  In this particular case, sales and marketing can rapidly develop a pricing strategy that works for Danone, is embraced by their retail partner, and, most importantly, resonates with the shopper.  Connecting these dots in the analog world is still possible, but can’t be done with the speed and agility that cloud-based solutions offer.

So has the market reach a tipping point with SaaS adoption?  Perhaps.  It would be irresponsible to project an entire market based on one great case study like that of Danone.  But I am confident in concluding that companies that wish to serve their customers better — and the entire value chain between their supplier community and the end consumer – can accelerate the pace of change through cloud-based solutions.

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