Zoho Corp cofounder explains why SMBs should transform their technology stacks to cloud-based solutions

In the wake of the COVID-19 pandemic, Indian SMBs are turning to cloud solutions in search of business continuity. Cloud technology allows CRM, ERP, web servers, enterprise applications, IoT solutions, etc., to be hosted online by a service provider.

Cloud technology and applications help SMBs communicate, monitor, and delegate crucial tasks even as they work from home. Tracking real-time data and preventing its unauthorised access are other features of cloud technology.

“SMBs now have the unique opportunity to transform their traditional technology stacks to cloud-based solutions. This will enable them to carry out their business and technology functions remotely and address their scaling demands without huge capital expenditure and providing rich customer experiences,” says Shailesh Kumar Davey, Vice President at ManageEngine, and one of the cofounders of its parent company, Zoho Corp.

ManageEngine is the enterprise IT management division of Zoho Corp, and claims to work closely with 8,000 SMBs, who have an average of 100-250 employees.

Indian businesses are now poised to adopt cloud computing and software at a heightened pace. According to a report on the impact of COVID-19 on IT spending by IDC, 64 percent of Indian organisations are expected to increase demand for cloud computing. About 56 percent are expected to increase demand for cloud software to support the new normal.

In an interaction with SMBStory, Shailesh Kumar Davey explains why SMBs should become more digitally-enabled and transform their technology stacks to cloud-based solutions.

Edited excerpts from the interview:

SMBStory [SMBS]: Compared to traditional businesses, how does a situation like the COVID-19 pandemic impact digitally-enabled SMBs?

Shailesh Kumar Davey [SKD]: The pandemic has affected several businesses, while helping some in fields like edtech, ecommerce, and telemedicine. Let us take the example of the most affected industry - the hospitality industry. A mid-sized hotel will be affected whether it is technologically advanced or not.

Being technologically advanced in this case would typically mean using digital tools to contact the customer, digitally receiving payment (some payment gateway/UPI tool), and a simple trouble ticketing/workflow manager for operations.

However, being digitally-enabled will give a hotel an edge over its traditional counterparts. At the minimum, the customer contact tool would enable the hotel to be in touch with the public and update them about the safety measures that have been put in place. This would help the hotel to be on top of the minds of the customers when the situation returns to normal.

More importantly, it will enable them to pivot to opportunities that present themselves unexpectedly. For example, the hotel could become an extended arm for a hospital nearby. Being digitally-enabled will also help to redefine the processes quickly, retrain the staff, and ensure new workflow instructions are followed.

SMBS: Why is there now a need for SMBs to adopt digital platforms, especially cloud, to ensure business continuity and growth?

SKD: The ongoing pandemic has obliterated the conventional IT operations and associated processes. It has forced enterprises to expose their on-prem IT infrastructure for remote access like never before for the sake of business continuity. Organisations not prepared for such sudden changes become vulnerable to security and scalability issues, which result in negative growth.

It is evident that companies that have adopted a solid cloud strategy have become immune or less affected due to the pandemic. Cloud makes it possible to dynamically add and remove virtual infrastructure to attend to any demands without compromising on the security posture of the services, something that is impossible in traditional on-premise technology platforms.

By going digital, companies can do business in a structured way, stay compliant with regulations like GST, and make use of newer opportunities. It also helps SMBs to scale up their operations geographically or over multiple channels. For example, a digitally-evolved retailer can continue offline sales and also sell on an ecommerce platform.

Finally, and most importantly, digital processes generate data automatically as trails. In service and support for example, those trails will reveal how long the ticket was pending before someone picked it up and how long it took the field service technician to attend the call. All such data can be analysed and the processes improved for the customers’ benefit and the organisation’s efficiency.

SMBS: Despite its numerous advantages, traditional SMBs could still be apprehensive about cloud technology. What are the myths associated with cloud adoption?

SKD: There is the feeling of losing control over business data and increased dependency on the third-party providers for taking care of data. However, the cloud ecosystem has matured well over the last 15 years and the application availability has improved drastically.

Similarly, since the business data is leaving the confines of the on-premises server, there could be a concern the data may not be very secure. On the contrary, most of the cloud providers have good security practices and are continually improving.

Hence, shortlisting a good cloud provider with stated SLAs, privacy policies, and security practices will go a long way in addressing these concerns.

But no organisation will become nimble just by migrating to the cloud. The adoption of a cloud solution needs to be augmented by a cultural change within the organisation, and employees need to be skilled/trained in using the software well and be able to analyse the business data that will be generated.

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SMBS: What are the advantages in helping SMBs adopt such technologies?

SKD: SMBs following traditional business models are vulnerable to competition and may be unable to service the increasing demands through newer delivery platforms. Cloud-born businesses may see higher growth as they will be agile and can optimise costs at various levels.

So, it is important for SMBs to focus on techniques that enable their process models to become more agile and automate routine tasks. By doing this, most of the workforce can focus on core business functions instead of handling mundane tasks.

Besides, they will be able to provide great customer service as well as keep their ears closer to the ground to get feedback from customers. Technology like ecommerce, online payments, and messaging enable this at a lower cost and at scale.

SMBS: What are the challenges in digitally transforming SMBs through cloud?

SKD: Usually, SMBs suffer from infrastructure inertia even when there is a budget for transformation. This inertia is due to the black box nature of vendor-driven technology and infrastructure stacks. There is no sandboxing environment to run production experiments and no data flow integration with other business units, resulting in no momentum for change.

Software vendors who are able to address these concerns by providing hybrid solutions (both cloud and on-premises) and have good implementation partners on ground to help SMBs will see a faster uptick of their services.

But steering a digitally-transformed SMB requires a higher level of skill compared to a traditional SMB. The good news is that the consumerisation of IT has followed the consumer trends. The skill level has increased a lot over the last decade in terms of the general population being comfortable with smart devices, mailing solutions, messaging services such as WhatsApp and Telegram, and other technologies.

Further, the availability of smartphones, net connectivity, fintech evolution, identity, digital signatures, and digital wallet are generating huge tailwinds for this transformation.

SMBS: What are some important factors for SMBs to consider while embracing any new technology?

SKD: A lot of digital transformation initiatives don’t succeed due to a lack of discussion within an organisation and a difference of opinion among top-level management. It is essential to create visibility across the board about any such initiative.

Efforts to transform an existing process or infrastructure should be implemented with KPI dashboards to measure the success and failure rate. This will help the management to detect failures faster and pursue alternative strategies without any delay.

Any new technology should help the customer in one form or another such as lowering prices, improving product or service quality, or introducing brand new business opportunities. Thus, when we place the customer in front and evaluate technology from that angle, the choices would be more simple and clear.