As a native of metro Detroit, I see firsthand how our local businesses have been impacted by the economic challenges we have endured over the past few years. This includes a major shift in how one of our once most dominant industries – automotive manufacturing – has needed to re-invent itself to remain competitive globally.

Adapting to the new norm has been a humbling experience for many, including myself and Microsoft. In Michigan, we have endured tremendous job loss. It wasn’t so long ago that the state’s unemployment rate reached nearly 30 percent. And throughout 2010, that rate was steadily in double digits. However, with a new year upon us, there is renewed hope and energy around what’s possible. 

Our state continues to diversify and our automotive industry is now right sized for profitable growth. The Big Three are all posting positive revenue results and customer satisfaction has never been higher.  That said, GM, Ford and Chrysler are different companies today, requiring a new way of operating to sustain this positive momentum.

At Microsoft, we believe that technology will play a critical role in this recovery. Not just in doing business more efficiently, but also providing a platform for growth. One of these technology enablers is cloud computing.

There are many reasons why companies are looking to the cloud to help them optimize for success in today’s competitive landscape. We’ve seen firsthand how cloud computing helps IT become more strategic, and how it can help companies innovate in all sectors of the economy. The cloud creates opportunities for new lines of business, new IT services, new ways of going to market and – ultimately – new employment.

This is not a trend, but a logical transformation in this information age and connected world. According to a recent Microsoft-commissioned survey, IT decision makers (ITDMs) strongly agreed that cloud computing presents a strategic opportunity for businesses, stating the cloud is “an engine of growth.” In fact, nationally, more than 35 percent of ITDMs who took part in the survey are currently – or plan to – implement cloud-based solutions in their organization within the next year.

What’s driving this movement to the cloud?

• Ruthless Focus on Core:  Auto companies today are laser focused on the customer experience. The auto manufacturer’s job is to understand and anticipate consumers’ demanding expectations and translate those expectations into designing, engineering, manufacturing, selling and servicing the best products on the road. Chrysler is in the auto business, not the data processing and data management business. The cloud helps it shed non-core IT activities so the company can spend more time focusing on its real business of selling vehicles and driving a differentiated customer experience.

• Speed: Getting a quality product to market as fast as possible is still key to any industry’s success. Many of the companies I have worked with are shackled by traditional deployment processes and have their employees on outdated versions of software. Many own the latest releases, but can’t find the time to deploy them. It is not only costly, but it is putting your most important asset (your people) at a disadvantage using outdated functionality. The cloud will always insure you’re on the latest software releases and deployment time is no longer any constraint.

• Agility and Flexibility: Many companies have seasonality that results in capacity spikes in their business. Traditionally, they have purchased enough hardware to support these requirements, even though that hardware was only used a couple of times a year for short periods. This is highly inefficient and costly, with wasted capacity the majority of the time. The cloud provides utility based capabilities and pricing that adjust to demand.

• Cost: One of the major advantages for businesses instituting cloud platforms is they no longer have to worry about the costs associated with purchasing and then running servers and other pieces of networking equipment.

• High Availability: The cloud infrastructure is designed with world class fault tolerance and redundancy to ensure the applications are up and running when businesses need them.

• Security: Knowing that your information and intellectual property is extremely valuable, security is a top priority for cloud computing providers. The security offered by Microsoft’s cloud platform surpasses that seen in traditional IT environments. This is why the government and banking institutions and other critical industries are heavy users of the cloud.

With all the strategic opportunities available through cloud computing, I strongly encourage business leaders to make a review of cloud computing solutions part of their annual business plans. Through the ups and downs faced in the current economy, it’s vital that businesses become more innovative and efficient – and the cloud is here to help.

Michigan has been through a tough ride these past few years. But we are survivors! I am proud to see how many companies in Michigan – from all industries – are using technology to change their position and the game.

To read more about the benefits of cloud computing, check out this feature story on the Microsoft News Center, as well as the results of new research just released by Microsoft regarding the Top 10 Cloud Computing Cities. An "Economics of the Cloud" whitepaper is also available.

Posted by John Fikany
General Manager, Heartland District, Microsoft Corp.