Disclosure: Microsoft is a client of the author.
This week Microsoft offered up a presentation on its “Microsoft Cloud For Sustainability” effort, which should benefit companies trying to wrap their arms around efforts to reverse climate change and pollution. Companies are looking to do more in this area because customers increasingly favor vendors with a strong focus on ESG (Environmental, Social, and Governance) values. The environmental part is currently getting the most focus because it is in the public’s eye with concerns around climate change driving vendor and solution choices.
But building up a tracking and reporting ecosystem is not trivial, so being able to build on the successes of others is a godsend for those attempting this very difficult-to-do task.
As much as this Cloud for Sustainability effort interests me, the vertical focus and the maturing of Azure is what I find interesting. Because this represents the next level of cloud maturity, where tools evolve to focus on targeted needs to positively impact productivity.
The Microsoft Cloud for Sustainability effort may have far broader implications for the future of the cloud.
Microsoft Cloud for Sustainability
Sustainability is certainly important, but achieving it isn’t easy. You not only have to track the pollutants you create, but must ensure your suppliers track them, too. (The importance of tracking an entire logistics chain has grown because a company’s good environmental reputation can be destroyed if it’s connected to even one visible polluting supplier.)
The data acquisition, ingestion, calculation and reporting requirements for an effort like this are massive. Firms have been “learning by doing” rather than learning from each other, which makes the overall effort more time consuming and difficult than it should be.
By creating a vertically targeted service, Microsoft can capture best practices, build extensible models, and supply focused support that can greatly reduce the time it takes a company to understand its supply chain and how much waste and pollutants it’s responsible for.
By focusing their efforts, customers can get a set of labor-saving tools uniquely designed to address sustainability. While this effort initially focused on carbon emissions, it will evolve over time to support mitigation of water and other types of waste. Beyond better sustainability monitoring, it also simplifies ESG reporting — at least regarding carbon emissions — increasing reporting accuracy and reducing both the labor needed and the risk of an erroneous report.
Vertical targeting: The present of the cloud
Microsoft has been focused on creating these targeted cloud efforts with for healthcare, manufacturing, nonprofits, retail firms, and business. Each provides a unique set of solutions that are improved over time and help the related effort to spin up efforts faster, better, and cheaper than if a company had to create a solution from scratch.
And I don’t think this will be the end of this evolution.
Next up: custom-targeted clouds
Right now, these vertical efforts are largely discrete. But over time I expect the components will become more modular — so a company could pick and choose the components that currently reside in one vertical area and use them for its own custom solution.
For instance, the heavy monitoring of partners in the Sustainability Cloud would also be beneficial for retail. And business clouds and retail cloud users will likely want business cloud modules, while healthcare opeations may also want business and sustainability modules.
Creating synergy between the vertical elements — and using Microsoft’s artificial intelligence capabilities to automate repetitive tasks and match modules with projects — would significantly boost the overall benefit of these linked resources.
What Microsoft has now is the foundation for future AI-driven solutions that could be independent of verticals and automatically modified to better address each unique use case. I think Microsoft is building something far more compelling than just vertical focus. It’s building the foundation for an entirely new cloud experience that automatically customizes itself for the industry, company, and project under development.
In short, the cloud is still in its infancy and, much like the internet, it’s vastly different now than it was not long ago. It will no doubt undergo massive changes before it fully matures.
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