Can Generative AI transform Cloud ROI?

While companies are in embracing the power of the Cloud they are facing growing challenges: the requirements these companies have to meet on this journey may lead to challenges preventing companies from creating new ROI from the Cloud. However, Generative AI may be the transformative force that will accelerate companies’ Cloud adoption and create new streams of revenue. 

McKinsey tech experts Mark Gu and James Kaplan argue that AI is the disruptor that will shift that value equation. According to the recent McKinsey report, Generative AI can add 75 to 110 percentage points of return to companies that decide to leverage the power of the Cloud. Another interesting fact is that Generative AI can add 75 to 110 percentage points of incremental ROI to cloud programs offering three critical values:

  • Creating new business cases 
  • Reducing the time and cost needed to migrate and remediate applications 
  • Enhancing the productivity of app development and infrastructure teams on cloud 

It’s clear that the next generation of Gen AI tools can accelerate their Cloud program ROI. GenAI is not only a tool for Cloud adoption; it is also a pathway to escalating ROI coming from the Cloud. Let’s see how: 

  1. Generative AI demands Cloud scale – Cloud solutions offer scalable and flexible infrastructure so that businesses can scale their resources. On the other hand, Generative AI requires significant computational power which requires Cloud computing to process large amounts of data fast. 
  2. Generative AI reduces migration costs – Cloud migration is one of the biggest barriers to Cloud adoption. With its ability to automate and optimize processes, Generative AI can simplify the entire process, and significantly reduce costs of migration.
  3. Cloud platforms can process large amounts of data before feeding it into AI models. GenAI can then go through the data to the data to determine specific patterns and trends. The biggest value of the Cloud here is its potential to run all the analytics-driven processes powered by GenAI. 
  4. Rapid deployment – Cloud-based services powered by AI accelerate the deployment processes, and the time needed to bring new innovative applications to market. This can have a major impact in industries that require fast delivery, such as retail and fintech
  5. Augmenting humans across the end-to-end process of application modernization — Generative AI can be employed to parse millions of lines of outdated code translating them into simple English, which would further help experts gain a better understanding of which code blocks drive which functions. GenAI tools can also help map out which code blocks should be modernized as well as whether new capabilities should be added

To be able to maximize the Cloud value through Generative AI, companies will need to take the following steps:

Consider the use cases that bring the highest value 

Cloud brings enormous benefits to businesses by simply cutting their IT costs. The transformational power of Generative AI brings a world of opportunities for leaders whose mission is to create new value in customer servicing, product development, accumulated workforce knowledge, and other areas. One of the potential use cases is a significant increase in application remediation productivity through the power of AI which could enhance companies’ ROI. To be able to achieve this value, leaders will have to shift their mindset and gain a better understanding of how Generative AI could bring value to their business, and which applications could benefit the most from AI, allowing faster and easier Cloud adoption

Be agile 

Adopting an agile-product operating model is crucial for maximizing value from cloud services. This model replaces traditional project-based approaches with planned work, empowers product owners, and ensures stable product funding. Integrating FinOps into this model is essential for managing costs effectively, especially with generative AI tokens, which can escalate rapidly based on design and user behavior. Real-time telemetry and proper reporting are necessary to monitor and control cloud costs. Embracing the potential of generative AI can position companies as leaders in cloud technology in the coming years.

Build a cloud platform with scalability in mind 

One of the essentials of the Cloud architecture is its ability to scale up as cloud workloads grow empowering developers to integrate resilience and security to be able to provide ready-to-use solutions which can result in faster and more cost-effective transformations. This becomes even more important when integrating Generative AI into the equation where risks are even higher, and developers have less experience. To avoid failures and high costs, cloud programs should incorporate generative AI services such as policies to ensure ethical use, appropriate security controls, IP compliance, etc. well-designed architecture should meet the needs of three important IT groups: developers, and site-reliability engineers. and IT infrastructure and security teams. 

Generative AI is gaining momentum across industries. What’s your next step?

In the future, businesses have various avenues to integrate generative AI into their cloud platforms. These include integrating generative AI-driven business scenarios, expediting the transition of on-premises transactional systems to enable comprehensive generative AI-driven customer experiences, and leveraging generative AI to enhance the returns on investment for application rectification and migration efforts. It’s crucial to embed generative AI capabilities throughout the entire cloud infrastructure, from fundamental frameworks to financial operations (FinOps) tools and security features, to ensure their safe and effective deployment.

To unlock the full capabilities of GenAI, organizations need to engage with a software development partner and leverage their extensive expertise and experience in seamlessly integrating GenAI in Cloud.

At Deployflow, our teams of experts are ready to offer valuable insights, guidance, and support at every stage, facilitating smooth integration and optimizing the advantages of AI for both software development and operational teams. To learn more about how we can help you triumph on this journey, reach out to one of our experts. 


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maya.budinski

Published on March 5, 2024