The way we buy resources for our business has changed.
Almost all IT products are now available as a service – XaaS – where the X can equal Infrastructure (IaaS), Software (SaaS), platforms, storage, containers and even desktops. The basic model is that the service is delivered over the internet and businesses pay for it on an ongoing basis, rather than tying-up capital in one-off purchases of software licences.
The benefits of XaaS include paying for software out of cashflow instead of capital, having the software maintained and upgraded consistently by the provider and the iron-clad security and up-time performance provided by large IT providers.
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But Australia’s digital transformation performance has not been great
Australia is currently performing relatively poorly in its transformation towards a digital economy currently ranking 15th out of 65 nations. Only eight percent of Australian organisations are getting results from their digital transformation activities and only seven percent of Australian businesses are digital leaders.
The fact that we even have these statistics show that we’re doing something right as a nation. But the numbers themselves show that there are winners and losers.
Adopting XaaS and the agility benefits that come with it could help you to be one of the winners.
Your transformation can make your business more agile
XaaS can make your business more responsive to changing customer needs, changes in your competitive environment and improvements in technology – more agile. But you must shed the burden of legacy technology and old ways of doing things. Any of these will hold you back.
Mid-tier businesses that rely on legacy technology and processes are largely banking their future success on their industry remaining as it is. But a quick glance around any marketplace tells us that even business models we take for granted are evolving rapidly: mechanical workshops use digital tools to diagnose mechanical engines, and will soon service electric vehicles; retailers use self-serve checkouts while click-n-collect makes warehouse staff customer-facing; travel agents are being side-lined by online booking sites; music is delivered online; legal opinions can come from computers and AI engines can write news articles.
For agile businesses, these changes are opportunities, not threats.
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Using XaaS improves agility and improves your performance
We are used to seeing examples like “Uber is the world’s largest taxi company but doesn’t have any cars”, or “Airbnb is the world’s largest hotel chain, but it doesn’t own any rooms.”
But we don’t always hear about the businesses at the other end of the equation, that use these services in their business models. Domino, TurnKey and Sonder, for example are upsetting the hotel investment business by taking long-term leases on apartment buildings and letting the apartments short-term on online booking sites. They are able to offer larger accommodation than nearby hotels, often in more quirky or homey properties and locations, at cheaper rates, because they save on property costs and staff.
These businesses are using Airbnb and other booking sites as the X in their XaaS – where X is their booking system and promotions department.
How you can accelerate and improve your transformation towards XaaS
Agility is not all about new businesses that are set to disrupt old industries.
Many industries are going about a quiet disruption from inside and XaaS plays a big part in that. CIOs who embrace XaaS as an operational model for their businesses find themselves spending less money on IT programmers and more money on business analysts. So they’ve reduced what they spend on people to build the tools and increased their spend on people who use those tools to improve the business. And that accelerates their responsiveness to customer and market needs.
And there’s an intangible benefit to XaaS too. Being untied from the physical location of the computer equipment – the servers and desktops – can change the business’s mindset. Staff find themselves able to work from anywhere with an internet connection. They leave their desks more, they talk to other people more, they even leave the office and work elsewhere. Teams on the road find it easier to access all the work systems, so they find themselves virtually closer to their colleagues, of not physically.
The agility of a business using XaaS can become a physical thing as much as a mindset.
And the mindset of a modular business – where components of infrastructure can be swapped in and out relatively easily – gives it the freedom to embrace new ideas and methods and jettison what is holding it back.
Why not talk to Tecala today about how XaaS can improve your business.