Despite the hype, enterprise cloud computing is still at an initial phase of adoption; though there is near consensus in the industry that cloud adoption in enterprises is an irreversible trend and one that is set to accelerate further in the years to come. Cloud adoption in enterprises has shifted from being a CIO/ IT led initiative to a business led initiative in many cases. Here are five reasons why cloud adoption continues to rise.
Increased agility delivered by private clouds
According to a recent Gartner poll, only 11% of enterprises polled worldwide do not have plans to deploy at least a private cloud in 2014 and nearly 50% of fortune 500 companies will have a hybrid cloud of some form by 2017. The reason for the popularity of private cloud is the agility it brings to IT environment management and better utilisation of virtualised infrastructure. Private clouds are a natural evolution of increased adoption of infrastructure virtualisation technologies that enterprise IT departments have invested into for some years now. The business case for adopting private cloud is evident from the Return on Assets (ROA) that IT departments have been able to achieve in addition to tremendous agility that cloud-based solutions bring.
Success in infrastructure virtualisation has accelerated the trend towards applications and business process virtualisation
We’re already seeing migration of workloads such as enterprise planning and core operations systems towards private cloud environments. The development and test environments of these applications on cloud are now considered a viable option. Most enterprise businesses are global, so the demand for a flexible and adaptable business process running on a unified global platform is becoming a necessity. This is creating a demand for business applications and processes to become highly virtualised and adaptable. Cloud computing provides enterprises with the capability to decouple applications and business processes from their underlying infrastructure making them virtual, configurable and adaptable to changing business needs.
Hybrid cloud solutions deliver next level efficiencies
Most business users are now fairly comfortable with the notion of consuming services from a private cloud and are now looking for further efficiencies. Enterprises are increasingly looking to achieve this by selectively migrating workloads to a public cloud service. Gartner predicts that by 2017, at least half of all large enterprises will have adopted hybrid clouds technologies in some form or other. Using hybrid cloud services eliminates the need for businesses to size their infrastructure requirements for seasonal peaks or unanticipated requirements. Establishing hybrid cloud reference architecture gives an enterprise the edge to focus on business expansion without worrying about scalability of their systems. Currently, hybrid cloud adoption is low, but is set to accelerate significantly in 2014 and beyond.
Cloud is now central to an enterprise’s digital business strategy
The impact of mobility, social media and Big Data technologies in the consumer space is beginning to be understood in business context. Mobility and social media are now mainstream, with connected consumers willing to share their views on social media, giving them the capability to influence other consumers. It is therefore critical for companies to proactively reach out, connect and manage their new digitally empowered clients. As a result, offering personalised services is becoming a key necessity for success in global markets. Systems and processes of companies will now need the capacity to gain insights from customer behavior and respond with personalised offerings. All of this calls for integrated systems that are configurable, dynamic, elastic and multi-channel. Thankfully, cloud based integrated digital systems and processes can bring these capabilities together in an affordable manner.
Cloud-native business processes find increased adoption
Over the past few years, the number of cloud based business processes in an enterprise is steadily on the rise. Customer Relationship Management (CRM), e-commerce, HR, Payroll, HCM and other business processes are steadily moving towards cloud based adoption in several industries. Adoption of SaaS (Software-as-a-Service) through platforms like Salesforce1, Workday, NetSuite and others is on the rise. Being built on cloud and natively mobile, these cloud based systems provide the required flexibility and elasticity for business processes to offer new capabilities required for a company to compete in a digital economy.
Posted by Madhavan Krishnan, Senior Director and Practice head - Cloud Computing & Leader (Millennial Solutions Group), Virtusa