As cloud finally enters mainstream, Accenture acquires itself into relevance

The old technology world had global companies such as Accenture and Deloitte playing a critical part in implementing solutions. Recent news suggest the new world will be similar.

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As part of the lead-up to its massive involvement at Salesforce's Dreamforce conference, $30 billion global professional services company Accenture announced that it was acquiring Cloud Sherpas, one of the larger, more successful cloud solution providers. Cloud Sherpas was only founded a few years ago. Indeed, I remember having a conversation with the founders at Google IO back in 2008, only a year after the company's founding. Back then it was a tiny team, and its somewhat nebulous business model was to help companies with their Google Apps deployments.

Roll on a few years and Cloud Sherpas has grown staggeringly, to the point where it is an 1,100-employee-strong organization. Much of that growth, it has to be said, was created through the large number of mergers and acquisitions that Cloud Sherpas embarked upon, but the fact that it has been able to maintain that growth and not self-destruct is impressive. Cloud Sherpas acquired many companies including CloudTrigger and Wave Adept (disclosure: I was an unpaid adviser to Cloud Adept who held no equity or other financial interest in the company). Cloud Sherpas also merged with cloud integrator Global One two or three years ago.

What is interesting is the timing of this deal. Accenture, for all its faults, is a canny operator. It realized that the right time to go "all in" in terms of its cloud activities was when the market had tipped to widespread acceptance. While Accenture certainly had a cloud footprint previously (anyone who has seen the extent of its DreamForce participation will be well aware of that), it felt like something of a secondary part of its business. With this deal, cloud moves into the mainstream. Indeed, Accenture is diving into this cloud thing with both feet, and the company talks about this deal powering its "Cloud First agenda." Whether that means that Accenture will push its more conservative customers to move to the cloud instead of on-premises solutions is something that will have to be seen. The company does make some comments about moving from a passive positioning of cloud to a more proactive one. What that means in practice will be interesting to see.

Cloud Sherpas has a massive, and very diverse customer base (indeed, my modest two-person Google Apps for Business account is managed by Cloud Sherpas). This has been somewhat accidental as the company acquired a host of different vendors across the globe — vendors that focused on different customer sizes and verticals. Cloud Sherpas has also extended its offering to Salesforce and ServiceNow, in an effort to offer something of a suite of cloud products. The 500 Salesforce-specific consultants that Cloud Sherpas has will be added to the 2,700 certified Salesforce experts on the Accenture side.

In an interview about the acquisition, Accenture's head of cloud services indicated that the expansion into the cloud space would not result in a massive price rise in terms of the professional services fees that companies need to pay for deployments. The theme was that Accenture generates more revenue from services beyond simple customization than it does from the basic stuff and that wouldn't be changing anytime soon.

Copyright © 2015 IDG Communications, Inc.

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