Finding the right cloud technology mix starts with deciding what to move to the cloud and addressing migration challenges.Download the reportDownload the infographic
Organizations are steadily increasing their use of cloud technologies to address wide-ranging requirements. The particular needs and business conditions of each enterprise help define its optimal hybrid cloud solution: most often, a blend of public cloud, private cloud, and traditional IT services. In this study, executives achieved the strongest results by integrating cloud initiatives company-wide, and by tapping external resources for access to reliable skills and greater efficiency.
A preamble to cloud integration
Cloud has evolved from a technological innovation to an integral part of business enablement. In 2012, only 34 percent of senior business leaders in our study “The power of cloud,” said they had a solid plan for adopting cloud computing. But in 2016, 78 percent of the executives we spoke with describe their cloud initiatives as coordinated or fully integrated.
Even with the rising use of cloud overall, almost half of computing workloads are expected to remain on dedicated, on-premise servers. Given this ongoing need, it is imperative that organizations determine and regularly reassess which combination of traditional IT, public cloud, and private cloud best suits their needs.
Executives in this study rated their own organizations based on both revenue/effectiveness and profit/efficiency. Sixty-eight percent more high-performing organizations report having fully integrated their cloud initiatives into an overall strategic transformation compared to the full survey sample (57 percent versus 34 percent, respectively).
Creating new value with cloud entails three major steps:
- Decide which IT and business functions to deliver through cloud
- Identify and address challenges in adopting cloud
- Realize operational, financial, and innovation benefits
To tailor the best-fitting cloud solutions, organizations must understand cloud computing’s business and financial implications, improve their abilities to manage complex ecosystem partnerships, and expand internal capabilities while exploring external solutions.
Evolution of cloud
Beyond its impact as a technological innovation, cloud computing has expanded significantly. Cloud computing is now a substantial part of new IT spending. According to IDC, worldwide spending on public cloud services is expected to grow from USD 96.5 billion in 2016 to more than USD 195 billion in 2020.
Even as cloud adoption matures and expands, surveyed organizations expect that about 45 percent of their workloads will continue to need on-premise, dedicated servers – nearly the same percentage as both today and two years ago.
Hybrid cloud solutions—which by definition include a tailored mix of on-premise and public cloud services intended to work in unison - are expected to be widely useful across industries. Each organization’s unique business conditions and requirements will define its optimal hybrid technology landscape.
So, how sophisticated are today’s organizations in identifying cloud opportunities and implementing integrated solutions? More than twice as many high-performing organizations report fully integrating their cloud initiatives than low-performing organizations. Implementing cloud initiatives in an ad hoc fashion reinforces siloes among different business units in the organization. Siloes result in numerous disadvantages and risks, including the use of diverse, incompatible technologies, deviations from enterprise architecture principles, and funding duplicate functions, all of which contribute to ongoing technology integration challenges.
Using the more mature approach of combining multiple related cloud initiatives into a coordinated program enables reusability of shared functions, elimination of deviations from design principles, and cost savings by avoiding duplicates and reducing future maintenance. Stronger integration of cloud projects becomes transformative, in part through centralized, coordinated efforts.
Meet the authorsJulie Schuneman, IBM Distinguished Engineer, CTO, Client Success, Hybrid Cloud at IBM
Robert Freese, Enablement Leader
Anthony Karimi, Partner, Cloud Consulting Services, Distribution Markets - NA Leader, Global Business Services
Meenagi Venkat, Vice President, Technical Sales and Solutioning Worldwide
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