So what does it take to succeed in the cloud? According to PwC there is no one type of company that has the secret formula for success in the cloud.
This comes as a part of PwC’s latest Global 100 Software Leaders research report wherein it has ranked 25 Fastest Growing Cloud Companies. With the list, the company intends to help existing and future cloud players understand what drives success when vendors move to the cloud.
From the ranking we can see that there are diverse mix of companies that have made it to the top 25. PwC’s 25 Fastest Growing Cloud Companies include startups as well as high-profile companies. The business models range from everything on the cloud to those with a tight focus on specific areas such as expense management, mid-market ERP and accounting.
One of the major findings of the report is that more and more companies are increasingly depending on software as a service (SaaS). With SaaS being pegged as a flag bearer of the cloud revolution, PwC notes that software vendors who’ve made the transition to SaaS are now going towards operations restructuring geared towards the realities of lower average sales prices and margins.
At least one third of the 25 Fastest Growing Cloud Companies are established firms that flourished for years from selling on-premises software licenses. It’s critical to remember that while cloud applications are less expensive to deploy, their switching costs are also lower—meaning that subscription revenue can dry up if vendors don’t think more carefully about customer service—service that spans from the user interface to product support.
Some of the other key findings of the report are that customers are increasingly accepting the cloud in spite of its foibles. Challenges aren’t just business oriented, but technical challenges also pop-up when it comes to cloud migration. The cloud gives software vendors a greater opportunity for customer engagement and the success in cloud demands faster product cycles from software vendors.
“Not all software companies will get it right immediately,” cautions Raman Chitkara, PwC’s Global Technology Leader. “Among the top half of our Global 100 Software Leaders ranking, six companies also appear on our Fastest Growing Cloud Companies list. We still have a relatively long way to go before the leaders and laggards in cloud are well established.”
With the cloud model affecting nearly every aspect of a vendor’s business, PwC identifies several operational considerations for software companies transitioning to the cloud. Pivoting to the cloud involves significant changes to a company’s business, both internal and external, including product development, marketing and sales, customer service and support, and revenue.
The impact of cloud computing is vast, with business issues, technical issues, cultural issues and customer issues to tackle. The cloud is indeed a new paradigm, and software vendors need to stray from their comfort zones to successfully transition all phases of the company.