{"id":337,"date":"2017-05-04T04:41:43","date_gmt":"2017-05-04T04:41:43","guid":{"rendered":"http:\/\/www.racknap.com\/blog\/?p=337"},"modified":"2017-05-04T04:59:52","modified_gmt":"2017-05-04T04:59:52","slug":"is-your-business-prepared-for-the-digital-transformation","status":"publish","type":"post","link":"https:\/\/www.racknap.com\/blog\/is-your-business-prepared-for-the-digital-transformation\/","title":{"rendered":"The Window Of Opportunity Is Closing Fast. Is Your Business Prepared For The Digital Transformation?"},"content":{"rendered":"

\u201cIt is not the strongest of species that survives, nor the most intelligent, but the one most responsive to change.\u201d<\/em> \u2013 Charles Darwin.<\/p>\n

Digital transformation is one such change that is set to completely alter the modus operandi of businesses today. Organizations are adapting to match the requirement of the current digital era \u2013 one that is facing significant changes in the way technology is created, managed, analyzed and consumed.<\/p>\n

69% of organizations consider digital investment important in achieving their organization\u2019s business transformation objectives.\u201d<\/em> \u2013 451 Research.<\/p>\n

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The digital business transformation is about \u201cmore\u201d \u2013 more people, making use of more technology, from more locations, through more devices and for more of the time.<\/p>\n

This transformation is also making the solution providers see a paradigm shift in terms of business technology use cases, their role as an IT services provider, customer preferences and more.<\/p>\n

A smart solution provider will need to identify this opportunity stream and look for ways to monetize it and build a recurring revenue source. But, what services or technologies will be the most beneficial? Or, which services will be most in demand that service providers should sell?<\/p>\n

Where does the opportunity lie for service providers?<\/h2>\n

\u201cOver 80% of customers are actively deploying or embracing the cloud.\u201d<\/em> \u2013 IDC CloudView 2016 survey.<\/p>\n

A study by 451 Research identifies the following major technologies that will see the highest level of investment in coming five years by organizations, amongst which cloud-based software, applications and infrastructure services will see 59% and 57% level of investments respectively.<\/p>\n

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Cloud, unlike traditional hosting services, requires a complete process to be followed before and after an organization migrates its application and services on it. Managing and running a cloud environment requires various skill sets like technology specialization, security expertise, compliance and risk management, orchestration etc. The graphics below shows the major cloud skill sets which the organizations find lacking when it comes to manage their cloud environment.<\/p>\n

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Not, every organization can have the complete skill set. Hence, most of them are willing to take the help of managed cloud service providers.<\/p>\n

\u201c50% of the organizations prefer a combination of internal IT and service provider\u2019s resources and skills for cloud application deployment.\u201d<\/em> \u2013 451 Research.<\/p>\n

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A managed cloud service provider helps the customer analyze which cloud service or application his organization needs, supports in pre-migration, on-boarding and post-migration services, backed with simple cloud billing and pricing. Being a local player, it understands the biggest pain points of the customers in terms of infrastructure, security, backup and most importantly, support.<\/p>\n

\u201cOver 50% of the organizations plan to use managed services for backup and recovery in the coming years, closely followed by disaster recovery and 24\/7 premium support services.\u201d<\/em> \u2013 451 research<\/p>\n

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Here, it\u2019s important to understand that as the demand for the cloud services grows, so is the competition among the service providers, so, you must grab it fast before the opportunity window closes.<\/p>\n

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Also, the competition is fierce and will turn fiercer soon. Look at the following stats:<\/p>\n

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The stats show the Average Revenue Per User (ARPU) with average renewal rate and average number of providers that organizations of various sizes use. As per it, the average number of years that a customer spend with the primary provider is 3.2 years.<\/p>\n

Retaining the customer and assuring renewals is primary in cloud business. That can happen only if you build a long-term value based relationship with the customer.<\/p>\n

Becoming a managed service provider or a cloud solution provider can be a great move. The MSP model will give you a monthly recurring revenue stream and a lifetime customer value relationship.<\/p>\n

To become a successful MSP, you should:<\/p>\n