3 lessons for IT from Amazon Web Services

Amazon.com recently posted its second-ever quarterly income figure: $23.2 billion in the last quarter, an increase of 19.9 percent that exceeded analyst estimates. That included $1.8 billion from Amazon Web Services, a full 81.5 percent more than in the second quarter of 2014. The division’s operating income was $391 million, an impressive 400 percent annual gain.

Both IT organizations and Amazon’s cloud competitors alike would be wise to learn three key lessons from AWS’s success.

First, AWS has a laser focus on the technology, including catering to developers. Developers are driving AWS growth, a fact not lost on AWS, which offers features and products aligned with building and deploying applications.

Second, AWS runs a frugal business. With its retail-oriented culture, money is tightly managed — and productivity is paramount.

Third, AWS has figured out how to sell to enterprises, unlike a few years ago, when it was a deer in headlights. These days, it has the processes down pat and provides enterprises the flexibility they require.

AWS’s success owes nothing to a secret sauce or a unique characteristic. Its major competitors know that, and I see signs they are trying to do the same.

But some cloud providers confuse the hard work at Amazon with marketing and raw technology, believing they can simply assert better technology and see the world come to them as a result. Here’s what they should do: Work to their own strengths. Don’t replicate other providers’ successes and hope that enterprises will somehow select your technology instead of the dominant offerings. If they can’t pull ahead, layer their technology onto those leading ecosystems instead.

But enterprises have the most to learn from AWS, despite their different business and technology objectives. Many enterprises consider developers second-class citizens. However, as devops and cloud become increasing game-changers, developers will likely lead the way to both agility and other business advantages. IT organizations that don’t understand it now will struggle later.

The strategic uses of cloud resources are making real differences in many innovative enterprises. Most are embracing the new tenets of being developer-focused and innovation-oriented. Emulate those companies.