What I Saw at AWS re:Invent That You May Have Missed
It was an interesting re:Invent for me – launching our new company, the constant feeds from AWS and several partners filled with litanies of new feature and product announcements, multiple multi-hour keynote speeches (yes, I did sit through all of them), working to discern hype from reality, fighting through the throngs of people, and trying to convince the 12-year-old child inside me that I don’t need a Deep Racer.
In the midst of all of this, there were a couple of interesting success stories that really validated my recent lines of thought regarding the business ramifications of cloud transformation.
Andy Jassy’s wide-ranging keynote included product and feature announcements related to Database, Storage, Machine Learning, Security, Blockchain, and who can forget Outposts (so you can run the cloud in your closet).
Revolutionizing the Insurance Industry
In his keynote, Andy Jassy introduces and turns the stage over to Dean Del Vecchio, EVP, CIO and Head of Enterprise Shared Services for Guardian Insurance. Guardian is a great example of a legacy enterprise that has embraced the revolution despite being in a highly regulated industry . With the words, “I’m going to start in a place that may not be expected – I’m going to talk about our workplace Strategy”, Mr. Del Vecchio had my full attention. From there he went on to talk about Guardian’s multi-year transformation that needed to take place before they moved their first workload to the cloud. They changed their office environment, modernized project methodology, trained their staff on new technologies, and ultimately revolutionized their culture. This was not a tale of a headlong sprint to cloud, it was a thoughtful, self-aware, and measured approach.
Once cultural change had begun to take root, Guardian stood up AWS environments and ran Proof of Concept workloads for a full year before the first workload was moved. They identified gaps during this time, and worked with vendors to develop solutions that enabled Guardian to be bold and confident in their migration. They documented their technological biases, the core being a Cloud First posture (rather than an All-In on cloud directive). Because of their approach and inherent understanding of the revolutionary nature of 21st century technologies, they were able to take a Production First approach to moving to the cloud. There were undoubtedly significant pain points and localized failures throughout this journey, but having come through the bulk of it now, Guardian sees their adoption of cloud as a competitive advantage. They have revolutionized the way they interact with their customers and are excited to begin making use of forward-looking technologies like AI, AR, and VR in the cloud to further enhance client experience.
Guardian's journey revolutionized a 158-year-old Fortune 250 enterprise, from top to bottom.
What was most interesting to me was what their journey was not. It was not exclusively an IT effort, a rapid lift and shift migration, or even primarily technical in nature. It was definitely not shortsighted in nature. It did revolutionize a 158-year-old Fortune 250 enterprise, from top to bottom, and they are now well-positioned for another 158 years of success.
Fender Guitars – re:Invented
In Werner Vogels’ keynote, he started off by talking about minimizing blast radius, one of my favorite topics, and he wrapped up by talking about Deep Racer, the toy that my inner 12-year-old seems to think I need. In between, amongst some explanations around high-level database software design principles, he introduced Ethan Kaplan, the Chief Product Officer, Fender Digital, from Fender Musical Instruments, one of the premier guitar manufacturers in the world. Mr. Kaplan shared some of the results from research Fender conducted around their client base.
Basically, it boils down to three key points:
- 90% of all first-time guitar buyers quit playing within 6 months of the purchase
- Those who don’t quit will purchase 8-10 guitars over their lifetime
- Guitar players spend roughly 4x the value of their first guitar on lessons
From this data they realized that there is a significant market for guitar lessons, and if they can find a better way to improve on the traditional lesson model, they will likely sell many more guitars.
This led them in two directions. They created a number of apps to help new players understand their new instrument, and they developed an app and teaching methodology that is more fun for the new player and helps them see musical success sooner. Combined, these convert a higher percentage of new players into lifetime players. The story I saw here is that the adoption of revolutionary 21stcentury IT technologies has enabled Fender to transform their business. They have always made great guitars and stringed instruments, and will continue to do so, but now their business is more and more about teaching people how to play. Fender is shooting 4k video on two soundstages six days a week to support this new mission, producing Terabytes of content per day. Working alongside AWS to create a video processing pipeline architecture, Fender can now automatically transcode down to cellphones and up to 4k televisions, simultaneously auto-populate their CDN and CMS, and archive raw video to glacier 24 hours a day, 7 days a week. Before long the core of their business will be developing and delivering musical training curricula with the manufacture of instruments being a sideline.
Realizing 21stCentury IT
For the past couple of months, I’ve been writing about how cloud and cloud-related technologies are revolutionary in nature, and how your decision to adopt cloud should be viewed as a business effort rather than a strictly technical effort. These two stories from re:Invent keynotes are great examples of similar success that I have seen with clients who have recognized and acted on this principle.
If you are reading this and you’ve already begun a cloud effort that looks like a data center move, it’s not too late to change course. Don’t fall into the trap of thinking that we’ll just Lift and Shift to the cloud now and transform later – this is a prime example of thinking of cloud as a technical rather than business solution. I’ve yet to see an enterprise be successful at following through on this approach. If you’re not looking at 21stcentury IT as a business change agent and competitive advantage, it won’t be long before one of your competitors is.
Andrew Pope is a Co-Founder of effectual, Inc.