Several industries have started to merge technology with their IP and become IT providers in their own right.

There are many examples from industries as diverse as financial services, manufacturing, and life sciences, which are developing and selling their own industrialized IT solutions.

Closely linked to the need to specialize is the need to create more structured alliances. It is becoming increasingly difficult to be “all things to all people,” and partnering with other IT companies is one way of developing more holistic solutions. IDC research has also shown that there is a strong correlation between companies that do a lot of partnering and better business performance.

Building a cloud business requires careful planning. Moving too fast can impact cash flow, but not moving at all can impact growth and new business.

However, a successful cloud business can help your business to build more predictable, recurring revenue streams, augment recurring revenue streams from managed services, open doors to new customers, enable you to extract higher revenue per employee, and create a number of upsell opportunities.

Although most channels acknowledge the momentum and growth in cloud, many are concerned about the impact cloud will have on their business — particularly in terms of revenue growth and the impact moving to a recurring revenue model has on cash flow.

To build a profitable, sustainable cloud business, IDC’s research has identified two key strategies for success:

1. Revenue Replacement Strategies
2. Optimization