Cloud Technology Is Changing Corporate Organization


Technology has been accused of making many jobs disappear, like the production line or the accounting office. And it is not done yet.

A company often resembles its communication and technology system. In the era of cloud computing that the tech industry is moving into, that seems to suggest that companies will have smaller departments, quickly analyzing data and endlessly experimenting. That means change is on the way at the many companies that will adopt cloud computing over the next few years. This might not be a good thing for Middle Managers to hear.

A corporate organizational chart from a century ago might look like a factory, with little workers at the base like parts, assembled by managers into units that interact with or fit into larger parts. Layers of white-collar jobs died in the “corporate re-engineering” boom 20 years ago, after email and networking replaced middle managers carrying plans among departments. Outsourcing and off-shoring happened once the dot-com bubble put lots of fiber optic cable under the ocean. Otherwise, you couldn’t have so many call centers in India, or manage a global supply chain.

In cloud computing, computer servers are pooled through management software. Power is dialed up or down depending on the workload, and the system is continually reconfigured, based on data about the next workload. To see how this changes a workplace, look at the structure of the biggest cloud companies around.

Two weeks ago, Amazon announced that so far in 2014, its cloud division had created 60 percent more new products than it did in all of 2013. Google also works in a data-fixated culture. Every meeting seems to be full of young engineers scrambling to amass the most compelling facts, trying to create something else they can watch customers use, then build on that. The big loser in this model may be the managers in charge of scheduling things, since it is all happening too fast.

At Amazon Web Services, which has built the world’s biggest cloud computing business, work is divided into teams of the smallest size necessary to figure out what the customer is doing with an important product. That team then quickly adapts the product to work better and looks for new insight.

Parts of this approach sound like the trendy “lean” tech start-up, ever changing to suit a new business model. It’s different at big companies, executives there say, when you are moving quickly but also have many customers and obligations.

It is not clear that any of the big companies has nailed this new style of work. Even so, they all say that their non-tech customers are badgering them to determine how they can break into smaller customer-focused teams, loosely collaborating and intent on moving information faster. The survivors will be good at collaboration, good at statistics and good at figuring out what the company needs to build next.

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