Business execs need to become venture capitalists and angel investors: Ed Lenta, Amazon Web Services

Business execs need to become venture capitalists and angel investors: Ed Lenta, Amazon Web Services

Innovate and iterate like ‘startups’ to compete with organisations using technologies to disrupt mature industries, says Lenta

CEOs and other business executives need to become venture capitalists and angel investors, building “factories of innovation” inside their organisations that invent and innovate like startups.

Ed Lenta, ANZ managing director, Amazon Web Services, posited this advice to businesses grappling with disruptions from organisations such as startups that are “thinking about production and consumption of technology” in whole new ways.

Mature and very profitable industries have been disrupted by these organisations, says Lenta in his keynote at the AWS Summit 2014 in Auckland.

He cites some examples: Air BNB for hotels, Spotify for music, Dropbox for Storage, Instagram for photos and Flipboard for magazines.

Enormous disruption by the production and consumption of service over digital means businesses have to find ways to innovate and iterate for customers, he says.

To do this, he says, “We need to change the culture in organisations.”

Read more: EROAD: Driving through clouds

“You have to democratise access to innovation,” he says, exemplified by creating an environment to “experiment often and fail without risk”.

But it is not enough to say we want to remove the stigma around failure, he says.

What business leaders need to do is create a culture in their organisations where the senior executives don’t see themselves as the people “who need to have the big ideas”.

They will see themselves as venture capitalists, as angel investors, facilitating groups inside the business that “invent and innovate” just like startups, says Lenta.

Read more: How MYOB CEO found his ‘edge advisor’

Ed Lenta, Amazon Web Services
Ed Lenta, Amazon Web Services

You have to democratise access to innovation.

They should be able to provide resources for people with these ideas to enable them to iterate “really quickly”.

Read more: CIOs: ‘Lead the disruption, be the disruptor’

If they fail, that is not a problem, he says. “Have you learned something? Is there some kind of information that we can now pass on to those around you?” These are the more important questions business leaders need to ask their teams.

To the successful ones, he says, “Let us iterate and grow and continue to expose them to customers and make sure we are coming out with great new products.

“That is the culture we all need to build inside our companies to make sure that we innovate with the best.”

The speed of migration to cloud

Read more: Springfree Trampoline uses the cloud to integrate ANZ and North America business systems

“Around the world, some of the world’s largest brands are looking to AWS as a strategic partner for innovation,” says Lenta.

These include Qantas and Commonwealth Bank of Australia which are looking to build new apps and migrating existing workloads into AWS. He says AWS is also working with public sector organisations and government agencies, as well as academic institutions.

He says one of the major transformations in the market is the way software vendors develop and deliver their apps as a service. Leading ISVs (independent software vendors) around the world are choosing AWS to deliver those apps.

“We are seeing fundamental shift in the marketplace,” and the speed in which organisations and developers are moving to the cloud is surprising, he says.

He says even AWS did not foresee enterprises and government agencies will be “moving so fast” to the cloud.

Moving to the cloud

Three New Zealand customers of AWS talk about the business drivers that prompted them to deploy cloud services.

Chris Riddell is co-founder of Parrot Analytics, which has developed a technology to capture demand for Internet content. The company provides insights into geographic-specific content consumption patterns and predicts global demand for upcoming content.

Parrot Analytics captures demand for pre-release content, collecting data from content fans around the world. It has created a BI engine that captures content demand today to understand which content will perform in the future. He says this insight is important as consumers now have more content choice than ever and in various digital channels.

He says the company is using an AWS technology stack to perform repeatable computational intensive tasks, and store and analyse billions of rows of data.

Jarred Clayton, engineering manager at EROAD, says the company’s use of Amazon cloud services was integral to its growth. “Using a cloud platform, we can support global expansion from our base in Auckland,” says Clayton.

Jarred Clayton, EROAD
Jarred Clayton, EROAD

Using a cloud platform, we can support global expansion from our base in Auckland.

The electronic road user charger and transport services company has opened sales offices in Oregon, USA, and in Melbourne, Australia, and will manufacture its in-vehicle units in New Zealand.

Supporting this scaling up would be a “nightmare” for traditional IT organisations, he says. In 2010 to 2012 alone, the company grew 2700 per cent, and this year is looking for 40 additional engineers.

“We are constantly growing, adding vehicles [using their services] everyday,” says Clayton. He says EROAD was also able to offer analytics as a service using AWS RedShift that can handle analytics workloads on large scale datasets.

John Emerson, global CIO of Tait Communications, says the company is using AWS for its global cloud applications infrastructure to interact with clients and partners, as well as with staff, across the world.

John Emerson, Tait Communications
John Emerson, Tait Communications

Staff are now focused on apps management, not hardware.

Tait provides integrated secure, mission-critical communication systems (software, hardware, networks and services). Its main markets include police, fire, oil, gas and transportation utilities.

Emerson says a number of software applications have already been moved to AWS. “Our policy, due to the limited internet infrastructure to NZ, is to move all applications to AWS that require access beyond NZ.”

Among the “positive impacts” to the company is the reduction by half of the time needed to implement new systems, improvement in infrastructure team delivery and in security. “Staff are now focused on apps management, not hardware,” says Emerson.

Costs for global backup systems were reduced by about 70 per cent and IT capex requirement was reduced by approximately 90 per cent.

As Tait extends its global services and software capabilities, AWS can provide a delivery platform that will improve our responsiveness and efficiency to our clients, while underpinning the resilience and robustness of our applications, he says.

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Read more: AWS re:Invent: Transform the enterprise through the cloud

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