The Cloud Goes Vertical Trend – What is a Vertical Cloud and Why is it the Next Big Thing?
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For organizations considering the Cloud goes vertical trend, consider leveraging an iPaaS integrator and/or software vendor to evaluate what processes can be automated or replaced with industry-specific APIs. This process will reveal whether a vertical integration is appropriate for the business and its goals.
Many industries have complex IT needs that must be met with specific software solutions. For example, healthcare and financial institutions must comply with strict data privacy laws.
What is a Vertical Cloud?
In this age of high-speed, online business operations, cloud scalability is a must-have. After all, a few minutes of downtime can cost companies thousands, even millions of dollars in lost revenue. That’s why many businesses are turning to a new type of cloud solution called the vertical cloud, which is built for specific industry needs from day one.
A vertical cloud is a software as a service (SaaS), platform as a service, or infrastructure as a service (IaaS) solution that has been optimized for a specific industry. It offers specialized functions and options that are aligned with the industry’s unique requirements and workflows, as well as hardware designed to boost performance.
A vertical cloud is a form of computing that increases the capacity of an existing system by boosting memory, processing power, and networking capabilities. This is also known as scaling ‘up’, and it can be accomplished by adding or replacing components like CPUs and HDDs. The process is often automated, which reduces the risk of costly downtime and allows businesses to scale their resources at a moment’s notice.
Why is it the Next Big Thing?
As the Cloud goes vertical trend continues, CIOs are looking for ways to reduce costs and gain efficiencies. They need to decide whether to procure pre-built software-as-a-service (SaaS) solutions and infrastructure-as-a-service (IaaS) services or build applications on top of horizontal platforms. They are also deciding how much of their current business processes to automate on the platform, if at all.
For highly regulated industries such as banking, health care and government, vertical cloud solutions offer the benefit of incorporating compliance specifications and industry-specific use cases. They are also able to simplify complex business processes with their built-in functionality and ease of implementation.
Another advantage of vertical clouds is that they can provide cost benefits by providing a pay-per-use model that scales up or down according to demand. This means that organizations can save on expensive hardware and IT resources while ensuring that they always have enough capacity to meet demand.
What are the Benefits of Vertical Clouds?
In addition to delivering improved functionality and business impact, vertical cloud adoption reduces the need for extensive customizations. The ability to scale up or down on a continuous basis based on demand makes it easier for businesses to manage resources and avoid costly over-spending.
When implementing a vertical cloud solution, it is important to first have a solid understanding of the expected demand and scalability needs. This can be done by working with stakeholders from across the organization, as well as the relevant cloud vendor and third-party consultants (if necessary). Once an accurate understanding is in place, establishing the right scalability parameters becomes much easier.
Most vertical cloud solutions fall under the Software as a Service category, however, Infrastructure as a Service and Platform as a Service offerings are also available. As a result, vertical clouds can be delivered as an entire suite of industry-specific solutions or in the form of individual modules.
What Are the Challenges of Vertical Clouds?
In the post-COVID world of remote work and end-to-end digitalization, business leaders are focusing on processes that make them stand out in the marketplace. Those analytic capabilities that drive competitive differentiation must be protected and nurtured; everything else is ripe for automation. That’s why the Cloud goes vertical trend is gaining steam.
The twin approaches of sharing software that meets common compliance, data management and other business needs and “lifting and shifting” on-premise systems to the cloud are still driving this trend. However, what’s new is that the focus has shifted from procuring generic functions and libraries to delivering industry-specific business processes.
As a result, it’s becoming more and more important for technology vendors to offer a full menu of vertical business solutions. These offerings are often available as APIs that can be connected to targeted smart factory systems and accessed via the cloud. This allows engineers and system architects to simplify their design process by eliminating the need to rewrite custom code for each industry-specific process.
Also Read: The Power of Versioned File Systems: How They Can Revolutionize Your Workflow
Conclusion
Industries such as healthcare, financial services, insurance, construction and manufacturing are top candidates for vertical cloud adoption. All of these industries have stringent standards, complex processes and require a high level of security. In these cases, a vertical cloud can offer them a platform that is built to meet all of their requirements, from ensuring compliance specifications to providing the right infrastructure and interfaces.
