Cloud computing offers a paradigm shift in the development and usage of computing resources. While cloud computing has become the default mode of IT service delivery in internet companies, established companies face multiple challenges and uncertainties in adopting a cloud-based IT delivery model. Multiple studies have explored the above problem from the users' point of view. This research tries to address the same problem from cloud service providers' point of view. The qualitative study uses the theoretical framework of value-based selling and involves semi-structured in-depth interviews with eight senior managers with varying experience with cloud service providers, supported by secondary research such as scholarly publications and media reports. The study identified multiple strategies for acquiring more enterprise customers and ensuring higher cloud consumption by large enterprise customers. The research enhances the understanding of the adoption of cloud and other disruptive services and integrates the perspectives of buyers and sellers.
TopIntroduction
For enterprises, information technology has moved from the peripheral role of an enabler of ‘back-end activities’ to being considered as the critical component of their business model. To sustain their technical leadership in an ever-changing world, the enterprises face the additional challenge of digitalizing their business, besides managing their existing IT infrastructure. Digital transformation involves changes in strategy, business model, process, and organization to create differential value by leveraging digital resources and assets (Kane et al., 2015). In their digital transformation journey, enterprises increasingly depend on cloud computing to reduce the complexity of IT operations and enhance business–IT alignment and organizational agility (Hentschel et al., 2018; Wang et al., 2016). To summarize, cloud computing is one of the most impactful IT advancements that has changed the way IT capabilities are delivered (Kappelman et al., 2013). A 2016 survey among CXOs by IBM Institutes of Business Value (IBM, 2016) found that almost 70% of the surveyed companies have used cloud significantly to achieve multiple objectives.
IT sellers understand well the importance of cloud computing, which has impacted the fortunes of many IT products and service providers. Many early providers of cloud-based services (such as Microsoft, Amazon) could create significant value for themselves. At the same time, failure to adopt cloud has adversely impacted businesses of several traditional hardware, product, and service vendors. As most IT workloads are moving toward cloud, selling cloud has become very important for IT providers. IT companies are investing significantly in developing cloud-enabled products and enhancing their resources' cloud-related skills and capabilities. The board of traditional IT giant IBM decided to split the 100-year-old company to take advantage of high-growth cloud opportunities (Mint, 2020). It is becoming evident that, in addition to the technological changes (data center, virtualization, security), cloud will have a transformational impact on the IT market and providers (Hentschel et al., 2018).
Increased cloud adoption by large enterprises and smaller organizations has opened many new roles and opportunities for offering services that were not available earlier. The cloud service market (IaaS, PaaS, SaaS) is dominated by three big providers (i.e. Amazon, Microsoft, Google) as well as a number of alternative providers (i.e. IBM, Oracle, Salesforce) (Tozzi, 2021). Together, they are referred to as cloud platform providers. Most of these companies are product focused and need partners who can deliver services essential for making the best use of cloud IT. As a result, the role of cloud consultant, cloud aggregator, and cloud resellers is gaining importance.
Implementation partners are involved in providing consulting and advisory services related to cloud; they possess knowledge about the offerings of cloud platform providers and deep industry or domain knowledge (Hentschel et al., 2018). They offer services related to changes in existing IT applications to make them cloud-ready, migration of those applications to the cloud, development of new cloud-based applications, and ongoing management and governance of the cloud. In addition, several complementors develop applications exploiting the capabilities of the cloud platforms; the diversity and innovation of apps play a significant role in the initial adoption and increased cloud usage. Thus, cloud platform providers, app developers, and implementation partners are part of cloud service delivery ecosystem and collectively termed cloud service providers (CSPs). Small and large organizations using the cloud to replace their traditional IT infrastructure or develop new IT capabilities are called cloud consumers (Hentschel et al., 2018).