Cloud news roundup

India’s Prime Minister Narenda Modi has unveiled an ambitious plan to bring the cloud to every Indian citizen. The website—MyGov.in—will store citizens’ vital records (e.g. birth, death, or marriage certificates) in a huge, easily-accessible digital locker.

China also has its eye on the cloud, initiating a cloud-computing program in its 13th Five Year Plan. The prospect has both Chinese and foreign companies salivating, with the cloud market in China estimated to grow to almost $5 billion by 2015. Companies there are jockeying for position to be the country’s supplier of security products.

Finally, NASA has set its sights a little lower than the moon—the agency is currently undergoing a massive cloud migration, freeing 110 of its applications from the surly bonds of physical storage space. It’s got far to go, though. Many of its applications were and are running on outdated systems and involved huge amounts of sensitive information.

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What’s driving industry cloud migration?

The pace of cloud adoption is speeding up and businesses have  an increasingly sophisticated view of the cloud’s benefits. But what issues are driving companies down the path to value?

Which of the following are most affecting your business today? Select up to three. Click to enlarge.WindstreamQ11As you can see in the chart of our total respondents, technology change is a top factor affecting businesses today. This is especially pronounced in government/education, retail, and financial services firms—48% of respondents from those industries said technology change is the top factor affecting their industries.

Legislative changes like the Affordable Care Act are having a pronounced effect on the healthcare industry—47% of respondents from that industry said increasing regulatory requirements were affecting their businesses, followed closely by economic uncertainty at 45%.

Professional services firms are an outlier—the top factors affecting that industry  are greater supply chain complexity (39%) and economic uncertainty and economic uncertainty (36% each). Product obsolescence is also significantly affecting more professional services businesses—28% vs. 17% of the total respondent pool.

 

Cloud strategy varies by industry

Cloud migration brings benefits across the value chain, but different industries see things differently. As you can see in the chart of the total respondent pool below, almost a third of respondents say new geographical markets or lines of business are driving growth.

Q12. Which strategic initiative is most important to driving growth at your firm? Select one.WindstreamQ12

 The story is different for retail, where 29% of respondents say operational efficiency is driving strategic growth. Healthcare, on the other hand, is significantly more driven by new geographical markets (44%). Professional services lies on the other end of the spectrum—only 20% said that new geographies were driving growth.

While financial services also value these growth drivers, a healthy 26% say that new product and service development within existing lines of business are driving growth. Government/education organizations are the least likely industry to have strategic growth driven by new product and service development—only 16% of respondents said that was so.

Cloud news roundup

A study of M&A in the second quarter of 2014 found that cloud and smart mobility drove 42% of technology deals. Of the deals greater than $1 billion, fully three quarters targeted internet, cloud/SaaS companies, or Internet of Things firms.

As we’ve seen from our study, security concerns are top of mind for firms migrating to the cloud. To that end, worldwide spending on information security will top $71 billion this year, with data loss prevention experiencing the fastest growth over 2013’s spending.

Another recent study shows how cloud is set to transform small businesses. By 2020, the report says, 80% of small businesses in the US will have migrated to the cloud. That’s explosive growth—today, 37% of small businesses have migrated to the cloud.

Infographic: Cloud’s business value

Today we’re premiering a companion our latest think piece. This infographic shows the ways companies are increasingly using cloud to drive business value. The less good news: while companies have sophisticated expectations for the cloud over the next two years, especially when it comes to areas like collaboration and innovation, performance metrics are in short supply. Click below to see the full infographic:

WindstreamValueThinkPiece

New paper shows cloud’s business value

Today we are releasing the second of four think pieces in our Path to Value program. Each of these short, targeted papers focuses on a key takeaway from our survey analysis. So far we’ve taken an in-depth look at cloud’s strategic role. This think piece explores where companies are seeing value from their cloud migrations.

WindstreamValueThinkPieceClick to read the full think piece

On the whole, our respondents are seeing more sophisticated benefits from the cloud as their migrations progress. First-generation cloud benefits like increased operational efficiency and savings still rank highly, but the majority of our respondents are seeing benefits like increased collaboration among partners and business units, innovation, and time to market today—and companies expect impressive growth in these areas in two years.

Despite these numbers, our survey found that performance metrics to assess the success of these cloud strategies are in short supply—just 43% say they have defined metrics for KPIs and even fewer have defined metrics for ROI. Those companies that do have performance metrics in place are more likely to have higher profit margins and strong financial performance.

C-levels disagree about cloud decision making

One of the key takeaways from our survey of 350 business and technology executives was that although businesses have a sophisticated understanding of the benefits of the cloud, plans for migration are in short supply. This dearth of strategy may have to do with how decisions about the cloud are made.

How are decisions about cloud and managed services strategy made at your company? Click to enlargeWindstreamQ20a

As you can see in the chart above, C-level executives have very different opinions on how these decisions are made. For instance, while 29% of CFOs say cloud decisions are made by an individual at headquarters, only 10% of CIOs say that. Furthermore, only 6% of the other C-level titles we surveyed agree with that statement.

30% of our total respondents said decisions are made by a centralized group or committee at headquarters. 40% of the other C-levels we surveyed agree, but only 20% of CFOs say that’s true.

The differing responses to this question are troubling—in order to have a successful cloud migration, companies should agree upon and have a clear decision-making process when it comes to cloud and managed services.