McKinsey sees Large Enterprises adopting Cloud faster

McKinsey recent global IT-as-a-Service (ITaaS) Cloud and Enterprise Cloud Infrastructure surveys found that the shift to the cloud is accelerating, with large enterprises becoming a major driver of growth for cloud environments. In the next three years, enterprises will make a fundamental shift from building IT to consuming IT.

A summary of both surveys is at IT as a service: From build to consume (free, no registration required). The key takeaways are

Enterprises are reducing on-premise deployment

In 2015, 77% of enterprises used traditional IT infrastructure for at least one workload; by 2018, this will drop to 43%. Conversely all varieties of Cloud deployments will increase

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Large enterprises are moving to Cloud far faster than before

mckinsey-2A deeper look into cloud adoption shows a significant shift coming in large enterprises. Large enterprises are finally catching up to small/midsize enterprises when it comes to cloud deployments. This portends significant headwinds for traditional IT and a boon for cloud providers since large/midsize enterprises form the majority of revenue/profits for IT vendors.

Cost is neither the primary driver nor barrier to cloud acceptance

Enterprises consider time to market and quality as the premier drivers for Cloud solutions outweighing any cost benefits. Security and compliance are the primary barriers to broad adoption. Cost comes in third but interoperability with on-premise private cloud solutions is also an important criterion.

Read more at McKinsey’s website.

Trust the Cloud to higher profits

Came across this Google-sponsored study, Trust in cloud technology and business performance: Reaping benefits from the cloud (PDF, no registration required) from The Economist Intelligence Unit (via Forbes/Louis Columbus). It’s based on a ten-country, multi-industry EIU survey of 452 senior executives and interviews with experts and is full of interesting insights:

An astounding 38% of I.T. at respondents’ organizations is cloud-based rising to 45% by 2019. Almost half of I.T. will be cloud-based by the end of the decade. And, the Cloud has already helped transform key areas such as time to market, greater agility and collaboration.
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Yet, while everyone is using Cloud, just 16% of respondents say their organization has a very high level of trust in the cloud and this level of trust is not growing quickly.

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The lack of trust is surprising when you consider the correlation between Cloud Trust and a wide range of key business outcomes from economic metrics such as Revenue, Profit & Share Price to non-financial ones like Agility, Collaboration & Innovation.

 

The conclusion is that Trust plays a key role. Cloud’s greatest benefits come from companies refashioning how they work and expand their capabilities by taking full advantage of the benefits and not from the low-hanging fruit of cost savings. Organizations with low trust are far from this transformation. Those with high trust are improving functional operations and profitability.

Hybrid Cloud Adoption has hit its stride

Rightscale just released their brand new 2016 State of the Cloud Survey with some interesting insights. It affirms what many other reports have concluded: Cloud Adoption is growing and

Hybrid Cloud is the preferred strategy in enterprises.

hybrid-201671% of companies are using hybrid cloud environments. It makes sense: for Cloud Apps to be truly useful, they need access to internal systems. That’s just common sense. We see our customers choosing hybrid cloud for many reasons but the most important one is:

Business processes running in the cloud are far more effective if they’re integrated with important data in business systems such as HR systems, databases and authentication systems.

These systems won’t go to the Cloud overnight for sure and maybe not for years. Hybrid Cloud is then obvious. If you’re a CIO, you can take an incremental approach and start seeing benefits quickly without having to move internal business systems and data wholesale to the cloud.

Our customers are increasingly taking advantage of this approach. We provide a Database Connector, secure Active Directory/LDAP support, Microsoft Azure AD, SAML for single sign on, a File Connector so you can save files to a network drive, and a Google Apps Connector so you can update a Google Sheet and/or upload files to Google Drive.

 

Visit our website to learn more and sign up for a free 30-day trial.

Cloud is moving UP the value chain

cloud3Cloud has obviously become ubiquitous. As we saw in Verizon’s Enterprise Cloud 2016 report, there isn’t much advantage anymore to simply using cloud.

Much of the initial value of cloud came from unplugging traditional data centers and eliminating hardware. Organizations now simply click a few buttons and presto! you have new servers. It’s easy to quantify this value – the costs of servers, the time to setup and maintain them as well as physical data centers etc. But everyone’s doing it now.

What about the future? How will cloud allow us to tackle far more complex challenges? As cloud technology advances, early adopters are already realizing new kinds of value from:

  • Automation and the resulting efficiency
  • Business Agility – focus on customers and new opportunities rather than wasting time on chasing down signatures and figuring out how data is stored.

Beyond hardware and data centers, cloud environments enable efficiencies reaching further up the stack than ever before. Managed Service Providers can automatically monitor production systems and perform administration tasks – you pay only for the level of service you need for each system and scale up/down in real time. On the DevOps front, cloud enables a more continuous model again by automating administration. The result is quicker release cycles and higher quality systems.

Further up the stack, Cloud is a key enabler for reengineering and automating business processes on mobile devices. When everyday approvals such as Purchase Orders, Employee On-Boarding, Patient Referrals etc. are digital, you’ll free employees from tedious, time-wasting tasks like tracking down approvals and let them focus on customers. More importantly, they’ll be able to react quickly to take advantage of new opportunities. A potential game-changer for your organization.

Watch a 4.5 minute video

Going even further, once you have this kind of automation enabled by cloud, you’ll be able to take advantage of business insights and intelligence to identify the bottlenecks, streamline operations. Even more important, with predictive analytics, you might learn what you should be doing before you need it rather than simply being reactive.

Cloud-based automation is the first step in the feedback loop you need to drive business strategy and make correct business decisions or risk being left behind.

Verizon: Using the cloud is now just “table stakes”

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Everyone’s doing it

This, according to Verizon’s State of the Market: Enterprise Cloud 2016 report (no signup required). 84% of Verizon’s enterprise-level cloud customers said their use of the cloud increased in the past year. Almost 100% of companies are using cloud in some formScreen Shot 2015-11-20 at 2.42.13 PM.

As a result, simply using the cloud isn’t that big a deal. Only 16% said that simply being in the cloud gives their company a significant advantage over competitors, down from 30% a year ago. Put another way: It’s not just the technology, it’s what you do with it.

The Pragmatists are the true believers

As the report says, the majority of companies are pragmatists. They’re moving things to the cloud incrementally – slowly knitting together enterprise-class infrastructure using standard cloud components tied together in a variety of ways. These companies are the true believers. They have existing applications but they’re so sure of the benefits of cloud that they’re rewriting the rulebook.

Hybrid cloud is now the preferred, mainstream solution

Screen Shot 2015-11-20 at 2.42.43 PMCompanies, especially large ones, just have legacy infrastructure. Asking them to move it all to the cloud is a non-starter. Combining public cloud, private cloud and existing on-premise systems (i.e. Hybrid Cloud) is the only pragmatic solution. While it’s complex, the technology is solid and the allure of transformative changes like new customer experiences, and business-agility benefits is impossible to resist. Many companies are turning to Managed Service Providers [such as Verizon Enterprise ;-)] to help build and manage their own customized environment.

 

Re-engineering business processes [on-demand]Screen Shot 2015-11-20 at 2.45.05 PM

So, if everyone’s doing it, how can you gain significant advantage from the cloud? Again, it’s what you do with it. It’s when you use cloud-based solutions integrated with existing infrastructure to deliver new customer experiences (e.g. new ways to interact with customers on mobile devices), faster responses (employees can act anytime, anywhere and from any device) and business agility (roll out new initiatives in response to changing market conditions).

Put another way: use cloud to make sure your employees are doing the right thing at the right time instead of wasting time correcting errors, chasing down approvals from managers etc. Let them focus on customers rather than getting bogged down in internal I.T.

Security

Finally, there’s always the elephant in the room. How secure is all this Screen Shot 2015-11-20 at 2.56.26 PMstuff? The evidence is that
Cloud is now seen as being at least as reliable and secure as traditional delivery models. So, while it’s important to keep an eye on security, the chances are your data is perfectly safe [and probably safer] in the cloud.

Interesting in finding out more? Visit our website to and see how customers are already using frevvo’s public and private cloud solutions to transform everyday business processes.

Computing is going in one direction – towards the Cloud

arstechnicacloudsCame across this article in Ars Technica UK (Warning: it’s a bit of an Infomercial with content sponsored by HP Enterprise), the basic premise is valid. We see similar trends in our customers.

Every CIO is interested in the cloud. It simply makes sense. You cannot compete with the cost structure of the large Cloud providers when it comes to basic infrastructure (servers, network etc.). When it comes to software, employees are also consumers and are accustomed to awesome user experiences on their mobile devices and apps that are regularly refreshed. Corporate I.T. departments simply cannot keep up. So whether it’s SaaS applications like GMail and Salesforce (who are finally rolling out a refreshed UI) or a product like ours which you can use to create your own customized SaaS-like application, corporate I.T. cannot expend the time, money and effort to refresh UIs, support the vast array of mobile devices, ensure 24×7 uptime and so on.

The Achilles heel is, of course, security. It’s hard to entrust some data to Cloud providers and all the high-profile hacks don’t help (even though, in reality, almost none of them affect cloud-based systems). And legacy business systems aren’t going anywhere [certainly not to the cloud] for many many years. So, there’s plenty of interest in private and hybrid cloud setups and we think it’s likely to continue for years.

That’s why, much as we prefer our customers to choose public cloud, we continue to offer both and will do so for the foreseeable future. Luckily for us, it’s the exact same software and we’ve learned that it doesn’t pay to offer too many variants (i.e. optional add-on features). The resulting increase in complexity isn’t worth it.

Read the original article here. Warning: you’ll have to wade through the infomercial fluff to get to the gist. Or, it’s summarized above for you 🙂

This Business Agility thing

Cloud Competitive AdvantageOver 90% of businesses are using cloud computing and it does appear to be delivering on its promise with an astounding 74% saying that it provides them with a competitive advantage. Survey after survey (such as this one from Harvard Business Review Analytic Services) claims that:

Business Agility is the leading driver for Cloud Computing.

Unfortunately, business agility is hard to pin down – roughly speaking it’s the ability for your business to react rapidly to changing business conditions. How does cloud help? We think of two main aspects:

  • Responsiveness – Enable employees to do the right thing at the right time. That means reducing business complexity (stop wasting time on paperwork, errors, missing signatures etc.), employee efficiency (let them work anytime, anywhere and using any device) and collaboration (access to people and information from anywhere as needed).
  • New Opportunities – Faster rollout of new business initiatives as business conditions change e.g. introduce a new product offering or modify internal processes to quickly satisfy changed customer demands even something as simple as letting people buy on their mobile phone.

Business Value from CloudBoth are sources of significant competitive advantage. According to HBR, companies are already seeing business value and benefits from simplification, collaboration, and faster reactions to new opportunities. All aspects of agility powered by cloud + mobile.

That agility appears to lead to some very tangible and measurable outcomes: cloud enthusiasts (those further along in their deployments than their counterparts) are more likely to have entered a new market in the past three years (49%) i.e. rolled out business initiatives quickly to take advantage of a new business opportunity or to have been part of a merger or acquisition (49%). Significant majorities believe cloud (+ mobile) reduces business complexity (71%), increases employee productivity (69%) and responsiveness to customers (53%).

Business agility is about both speed and doing the right thing at the right time. Cloud is a key enabler of all these  aspects of agility.

Click here to download the Harvard Business Review report (no registration required).