Tuesday, September 21, 2010

LMG Emerge: Cloud Computing Might be a Huge Catalyst for the Indian Economy

Hagel and Seely Brown wrote an interesting piece in the Harvard Business Review blog. The blog entry includes a link to their more extensive paper (in pdf). Definitely something worthwhile to read for all of you who have heard about cloud computing or are busy with it, but do not really grasp what it will mean for you and/or the business that you work in.

Conceptual Diagram of Cloud Computing

When studying the material as part of our analysis of international trends in IT - next to of course the impact it will have on our own work - we came to a first preliminary conclusion:

From Core to Edge

1) The traditional 'business model' similar to what we see in industries like biotech and big pharma where creative ideas are developed in the periphery in small firms, but will only truly materialize after they are being scaled into something huge by big pharma companies, will be deteriorated. Creativity will persist along the edges, but far more quicker than ever before will scalability now be available directly to firms working in those niche areas. They will simply work with information they can get directly from within the cloud from different fellow niche producers who specialized in other areas. This will be in the interest of every society, but not necessarily in the interest of big business.

Beware of India
2) India is probably the super power with an IT and related infrastructure when it comes to businesses, personnel, human resources etc that can benefit tremendously from cloud computing as a service. Through their Institutes of Technology and even Management, but also through its more general positive relationship with knowledge in general and IT in particular the Indian economy does probably contain the largest amount of firms and / or creative persons  who can either as edge players within the IT industry (and/or through implementation of components of IT knowledge created by edge players in the cloud in other industries as well) gain advantages over competition that were previously more or less impossible. Either because the knowledge and IT products weren't directly available and/or big business would have first have encapsulated it into its internal hierarchy and bureaucracy as a result of which dozens of great ideas were disrupted and lost with the ones that were developed and scaled successfully becoming too expensive and available at too slow a pace to be usable by the creative edge players in other niche areas or industries.

 India's IT sector potential beneficiary of new trend


Media, Health Care, Energy and Financial Services to benefit next to IT
Industries that can benefit according to Seely Brown and Hagel are Media, Health Care, Energy and Financial Services. Is it really a surprise that - when comparing India with other Emerging Markets - these are industries that are already right now part of the portfolio of strongholds of the Indian economy? Maybe not in all cases already strongholds when comparing it with what is going on in developed markets sector peers, but definitely vis-a-vis efforts in other Emerging countries. LMG Emerge believes that this will rapidly change.

No comments:

Post a Comment