Accenture is the 800-pound gorilla in the IT services and consulting space. To put its scale in perspective, consider this: the company reported revenues of $16.2 billion in the quarter ended May 31, compared to, say, Infosys with revenues of $16.3 billion for the whole of FY22.
Accenture’s growth and success emanates in large part to the support it provides enterprises as they shift to the cloud for cost and efficiency. Cloud accounts for nearly 40 per cent of revenues and the man shaping its growth is Karthik Narain, Lead of Accenture Cloud First. On a recent visit to India, Narain spoke to BusinessLine on what drives this growth and the future roadmap. Edited Excerpts:
What is Accenture Cloud First? Is the move to the cloud a once-in-a-decade inflection point for enterprises?
Sometime towards the end of 2019, when our CEO Julie Sweet took over, we made a big organisational change called The Next Generation growth model, in which we removed a dimension of the matrix altogether, and moved from an industry primary dimension to a local market driven dimension. This was accompanied by a change in role for 95 per cent of our leadership teams. Even as we were rolling out organisational change, around March 2020, we went into a shutdown on account of the pandemic.
During this period, three things stood out in stark relief. Organisations require quick change or elasticity in their business model. What do I mean by that? For instance, a retailer makes a huge investment in a retail store, the retail experience, the systems for it, and also (maybe) an online channel. But when Covid happened, stores closed and everybody had to go 100 per cent online.
Enterprises should have scalability and resilience so as to handle a sharp increase in demand. For instance, say, customers want to buy toilet paper for the next 10 years all at once. . This could lead to a supply chain blockage from certain geographies and would call for a shift in the supply chain model.
Third, certain businesses found that while demand had dropped, their cost structure had not. Many organisations struggled in the absence of these factors in their business models.
However, a certain segment of organisations were faring well, and they happened to be in the cloud. Born in (or adapted to) the cloud, they were able to shift resources from one site to another in efficiently.
Though cloud was already a sizable business for us, we were doing it in dribbles and pockets of the entire organisation. While we thought cloud transformation and migration adoption would happen over the next decade, the pandemic ensured it would happen over the next three to five years. There was no trial and error. One needs to go with a model where you rinse and repeat, options, solutions and ideas. So, we brought all these capabilities together, pulling people from our industry, technology and ecosystem organisation, and branded them under Accenture Cloud First.
A cloud first mindset is about how you build new products or services. How you reimagine customer or partner engagement and experience? How you rescale and retool your employees to fundamentally reimagine how the world is going to work in future. That was the vision we created for Cloud First.
With regard to the shift to the cloud, there were apprehensions, especially among large organisations, on security, privacy and IP, apart from the legacy investments. How do you address those challenges?
So we demystified the meaning of cloud. We said that cloud is not a destination, but an operating model, it means the cloud continuum, it means capabilities from public, to private to edge, and everything in between, all seamlessly connected by modern cloud first networks. The cloud means that there are certain IT assets or resources that are configurable, that are easily consumable and are automated. That is why the public cloud was popular, because you don’t need to procure servers, racks, don’t need to go find a space to put them or find somebody to stack it right, network it or provision it. You can ask for it, and it’s there. It’s configurable, easily consumable on demand and is automated.
So we said that you can get this facility not just in the public cloud, but you can get it in your own data centre as a private cloud or in a hybrid cloud. You could also get the same capability in your edge location, whether that’s a retail store, healthcare, a warehouse or factory.
The second question pertains to candidates in the public cloud, in the private cloud, and candidates in Edge. If you have workloads that need unlimited scale -- one day, a million users, and the next 10,000 users -- that’s a candidate for the public cloud because you don’t need to provision all that stuff. If you need certain workloads that need data privacy, then it is a private cloud. If you want to provide experience to your customers through a device at your corporate office or for customers in a retail store or in a bus, you need the experience to be provided where they are living, then Edge. Hence clients start thinking about Cloud as a way of life or an operating system for future innovation, rather than as a destination.
You have a large footprint abroad. How does the India operations contribute to the cloud business?
India plays a very significant role again. We wouldn’t be able to run a business at a global scale without looking at talent, capability and innovation from across the globe. I’m generally fascinated by growth markets and their ability to adopt to changes and newer capabilities. India has been at the epicentre of it. So India contributes significantly to the innovation hub we have here.
This is where the alchemy happens, where our industry and technology capabilities come together, and along with our partners, we create and build stuff, all in the cloud. A lot of my global leaders sit out of here, not just managing the India operations and India business, but managing global operations. A lot of our asset and tooling strategycomes from here. Not just as a resource base, but as a market too. So we see huge penetration in the Indian market. We are doing a lot of work, with both traditional enterprises and start-ups, in getting them to cloud.