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SME Classroom: The Key to Transformation — In Applications, Speed Is Unbeatable

"In martial arts, nothing but speed is unbeatable." The same holds in business: enterprises whose IT systems can deploy applications quickly and launch new services gain an edge in competition. This article looks at why cloud-native applications matter and how Hong Kong enterprises can adopt them in three stages.

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In brief

Fast, effective application development and deployment is key to digital transformation, and cloud-native applications are especially important. The article suggests Hong Kong enterprises proceed in three stages: respond with agility, adjust and build capability, then go digital first to accelerate innovation.

When Feng Qingyang taught Linghu Chong the essence of the Nine Swords of Dugu, he said, "In martial arts, nothing but speed is unbeatable" When Linghu Chong later fought Dongfang Bubai, speed became the key to victory. In the business world, this principle matters even more. On a mobile phone, if an application runs slowly, the user experience suffers greatly and the app can be replaced at any time. The same is true in business.

In an enterprise, if the IT system can deploy applications flexibly and quickly and launch new services, it will help the company win a place in fierce market competition. On average, each company in Hong Kong has 200 to 300 applications, including both in-house and third-party developed ones. If applications run poorly or take a long time to develop, they will undoubtedly "slow down" the customer experience.

Digital transformation is not easy: effective app development is the key

VMware's global study in June this year indicated that effective application development and deployment has become the key to digital transformation at this stage. Among these, cloud-native applications are especially important. Cloud native is an approach designed to take full advantage of cloud computing, giving enterprises unlimited on-demand computing capacity as well as pay-as-you-use pricing. It is application-centric: by breaking an application's functions into smaller parts, enterprises can quickly build and deploy programs across different hardware and clouds.

Startups are using cloud-native approaches to launch new services quickly and disrupt traditional industries. Gartner predicts that by 2020, 75% of global enterprises will run containerized cloud-native applications in production. In China, by the end of 2018, 96% of IT enterprises had already deployed containerized applications.

The survey also found that 90% of respondents encountered obstacles during transformation, including a lack of talent, strict security and regulatory constraints, and technical difficulties in integrating multiple platforms. In Hong Kong, enterprises commonly face two major challenges in digital transformation: a shortage of talent and the absence of a simple, unified, modern IT infrastructure.

A three-stage approach for Hong Kong enterprises to make good use of cloud-native applications

In Hong Kong, enterprises face the same difficulties and have also been deeply affected by the pandemic. How can they realize the benefits of cloud-native applications in future digital transformation? We believe enterprises can proceed in three stages.

Stage 1: Respond with agility and keep operations running

Many companies accelerated their pace of digital transformation because of the pandemic, developing and deploying large numbers of applications so that employees could access company resources remotely and continue serving customers. Companies recognized the advantages of cloud native and container management platforms and were therefore happy to adopt them. Remote work has become the new model and will only become more common even after the pandemic passes.

Stage 2: Adjust and adapt, and build up capability

In the pandemic's adjustment and adaptation phase, companies have established relatively stable remote or hybrid operations. At this point, the focus of digital transformation should be on upgrading IT systems, improving employee skills and refining internal processes to adapt to the new normal. This requires companies to modernize their applications and promote a consistent IT infrastructure, thereby reducing spending on proprietary platforms and skills. At the same time, enterprises should build an enterprise-grade open source container catalog and increase training for in-house technical staff to speed up application development. Gartner predicts that by 2024, 75% of large organizations in mature economies worldwide will be using containers.

Stage 3: Digital first, accelerating innovation

Finally, in the stage of accelerating innovation, enterprises should aim to be future-ready and establish a "digital-first" strategy. After planning future business models, enterprises can begin to build long-term competitive advantages and strengthen their resilience against risk. At this stage, traditional processes often hinder innovation, multi-cloud architectures become complex, and the deployment of large numbers of applications begins to create security and compliance risks. Enterprises should therefore promote automation, achieve consistency across multi-cloud environments, and speed up application deployment and IT system maintenance. At the same time, they should containerize and modernize applications to strengthen security and compliance.

Original article: https://bit.ly/3dDUKh2

Frequently asked questions

Why does application speed matter for businesses?

The article argues that if an IT system can deploy applications flexibly and quickly and launch new services, it helps a company win a place in fierce competition. Slow-running or slow-to-develop applications will "slow down" the customer experience.

What is cloud native?

Cloud native is an approach designed to take full advantage of cloud computing, offering unlimited on-demand computing capacity and pay-as-you-use pricing. It is application-centric, breaking an application's functions into smaller parts so enterprises can quickly build and deploy programs across different hardware and clouds.

What challenges do Hong Kong enterprises commonly face in digital transformation?

The article says they commonly face two major challenges: a shortage of talent and the lack of a simple, unified, modern IT infrastructure. The survey also found that 90% of respondents encountered obstacles in transformation.

What are the three stages for Hong Kong enterprises to adopt cloud-native applications?

Stage 1 is responding with agility and keeping operations running. Stage 2 is adjusting and adapting, upgrading IT systems, skills and processes. Stage 3 is going digital first to accelerate innovation, using automation and containerization to strengthen security and compliance.

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