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April - 2015 - issue > CXO INSIGHT
Head in the Clouds
Ananth Avva, Chief Financial Officer, LiveOps
Monday, April 6, 2015
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The role of a Chief Financial Officer, especially in mid-market size companies, continues to evolve rapidly beyond the immediate realm of finance. As LiveOps' Chief Financial Officer, my time is spent balancing the needs of various stakeholders from the conventional duties such as answering to investors and capital allocation, to key decision maker in data center deployment, product pricing, and strategic support function for the business so we collectively hit key financial metrics. Naturally, the evolution of the class of "operational" CFOs allows us to provide a perspective to highlight not just the ongoing technological trends but offer a financial lens to why those changes matter to investors. Ultimately it is the synchronization of the technological merits of cloud with a sound financial strategy that will continue to fuel investments and growth in the sector.

We are still in the infancy of cloud adoption and cloud technology. There are multiple applications available in the market today that use cloud computing and cloud providers are experiencing significant growth as they capture much of the market share from the traditional software and on premise solutions. As evidenced by the Bessemer Venture Partner (BVP) Cloud Index, public cloud companies have generated over $80B in market value since 2012.

Cloud Leaders Will Begin To Emerge
As cloud adoption expands more and more companies are finding ways to leverage the flexibility, scalability and cost savings it offers. Specialization in the cloud is fast becoming a trend. Take LiveOps for example. Through the LiveOps Cloud Contact Center Platform our customers are able to offer seamless interactions over different channels - voice chat, email, SMS and social - to their own customers. That is something unique. The ability to pivot between all of these different channels on a singular desktop gives the user a lot of power. We are able to monitor and report a customer's journey as he or she navigates through the ever widening communication channels in a singular platform. Cloud vendors will continue to develop specialization in their verticals and emerge as leaders.

Big Data and Cloud Will Propel Deeper Insights
We are also seeing notable developments emerging from the Big Data arena. As a cloud based application the LiveOps Platform captures a lot of rich transactional data. The LiveOps Platform captures metadata that tracks the customer journey from contact to closing the order. Amalgamating that customer journey from the LiveOps platform with the already rich data set in Customer Relationship Management (CRM) will begin to provide unique insights to companies on how better to manage customer experience and satisfaction. Cloud applications are therefore uniquely positioned to not only integrate effectively with Big Data, but then leverage the findings to roll out new feature sets seamlessly relative to traditional on-premise system.

Cloud-Based Technology Enabled Services and the New Economy
Another emerging trend is the resurgence of technology-enabled services or the New Infrastructure Economy. Nouveau-technology companies such as Uber, Roadie, AirBnB and more aren't just offering a cloud platform, but rather layering a variety of tangible services on top of it. LiveOps is in the same vein. Not only do we provide the SaaS-based solution for contact centers, but we also provide services and telephony on the cloud. LiveOps has successfully migrated the people, process and technology to the cloud, and therefore the end-to-end customer service experience is in the cloud. The ability for companies to deliver tangible services in the cloud will continue to disrupt traditional business models in the coming years. Investors who view this from a strategic and financial standpoint, see technology-enabled services as uniquely positioned, since it would be very difficult for new entrants to displace the incumbent. This is because to make a mark in a specific field, one needs to have a combination of superior process innovation and a superior technological solution.

Cloud Forecast
Over the years to come, the cloud will become more mainstream because there is enough talent in the pool and enough capital available to support the right solution. However, there is still room for improvement and cloud companies can do more for customers when it comes to adoption and the solutions they offer. For example, take back-office support technology, like email and storage solutions. There are multiple solutions available today that cater to this like box, Dropbox, Google Drive, Amazon, Microsoft Onedrive and a plethora of others. So who wins that market?

Each solution has unique advantages and approaches to the market. Larger companies do this by making it easier to use their products in tandem with their other offerings like Google. Companies like Dropbox and Box give intuitive User Interfaces, focusing on data analytics and other value-add features. One thing is certain, as these strategies play out, cloud applications will be increasingly sophisticated and complex. Through that evolution cloud vendors will need to take a page out of others' playbooks, such Apple or Google, and develop strategies to nurture power-users and brand advocates that will strongly advocate one solution or the other. All cloud companies can benefit from embracing the power-user strategy and should aim to build a network of brand and product advocates.

Removing Bottlenecks and the Future
As cloud vendors evolve rapidly and build feature parity with on premise vendors, barriers to infrastructure will also decline with time. However, as networking and computational ecosystems evolve and continue to scale at break-neck speeds (e.g. rapid deployment of dark fiber), we can expect to see cloud ecosystems continue to accelerate in performance and growth. The rapid build in infrastructure will continue to accelerate cloud-to-cloud integration and build rich ecosystems. Breaking the infrastructure barriers and the integration of cloud-to-cloud ecosystems will continue to fuel the growth of cloud even faster in the coming decades.

Furthermore, conventional concerns with cloud, such as security or feature parity will also see changes. For example with security, people feel safer having an in-house infrastructure solution because of the perception of control over it. However, as security features in cloud offerings continue to improve and the industry continues to pave the way in security features and data protection, overtime, cloud may very well surpass on-premise solutions in security in the near future.

Cloud is Here More Than Ever
As I mentioned, cloud adoption is still in its infancy. Cloud leaders will continue to emerge and cloud-to-cloud integrations will help propel new ecosystems, such as technology-enabled services, to continue to disrupt various industries. It's certainly an exciting time to be a finance professional in the space and help it continue to scale for many decades to come.

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