Andy Burton, founder of the Cloud Industry Forum, assesses the impact of the cloud on UK business and the challenges facing IT strategists
Cloud services have come of age in the sense that over three quarters of IT directors interviewed in recent research by the Cloud Industry Forum now state that they actively consider if each new IT project they tackle should be delivered as a service rather than an on-premise infrastructure.
So cloud has clearly moved out of the realm of novelty, proof of concept and R&D into mainstream acceptance and adoption by IT professionals. When looked at alongside the other mega-trends of mobility and social media, the opportunity for cloud-based IT to disrupt our way of working, collaborating and communicating is huge.
Of course the hype still circulates, and yes, the term “cloud” is still vague in the minds of many, and the commercial, legal and regulatory frameworks for cloud are still very immature and evolving.
But these factors cannot displace the realities of the pure economic and organisational agility benefits that arise when businesses embrace cloud as an IT deployment model to overcome the often cited constraints of time to market, scalability, increasing competitive pressure and rapid pace of market adaption.
The case for cloud, either as a primary base for delivery of IT or as a complimentary model within a wider IT strategy, is increasingly compelling. It is further evidenced by the rate of adoption seen in the UK (well over 60 per cent of UK companies have at least one cloud service deployed today), the high degree of satisfaction reported (currently 92 per cent of cloud users are satisfied with the service they receive), and the expectation of future growth (76 per cent of existing users claim they will expand their cloud use and a 14 per cent growth in new users is predicted within 2013 alone).
The challenge facing those people whose role it is to set out and implement IT strategy is not whether to embrace cloud as an effective deployment model, but where, when and how
At its heart, the concept of cloud is all about organisational transformation though the agile on-demand delivery of IT solutions; it is not so much about the technology itself, but what it enables. Cloud solutions enable us to challenge our thinking and ways of working at both a personal and contextual level, they have redefined how we can procure and implement IT, and redefine what is “achievable” when organisations are no longer shackled by the legacy constraints of labour, skills and capital.
So why is cloud, supported by mobile and social technology, so disruptive, compelling and sustainable a proposition? It boils down to four key inter-related forces which reinforce the momentum and which I would summarise as:
Momentum of consumerisation
Since the birth of man, it has been human nature to invent and to enrich our capabilities. Often we experience innovation and have access to technology in our personal lives that we can only wish was as available, intuitive, fun and dynamic at work. Coupled with this, most of us at some point also exist in three personas at once: as a citizen, as a member of a family and as a colleague in a work environment where culture not technology often artificially separates our needs. The innovation driven by our human experience is encroaching on our work lives and drives new ways of thinking of how to collaborate, communicate and compete.
Normalisation of context
No matter where we are, what time of day or what device is most accessible to us, we will continue to see an increasing normalisation of our experiences between smartphones, smart TVs, laptops, tablets, work stations and so on. The barrier between devices and interaction for user experience is getting smaller and enabling activities to be tackled efficiently in any context in a common format. The combination of cloud and mobile is fuelling the achievement of access anywhere on any device, fundamentally changing the boundaries of how and when we work.
Competing global dynamic
As a citizen in the UK, it is all too easy to get complacent about our high levels of access to technology, evolved business processes, and history of democracy and innovation. However, we also exist in a world that is globally connected, online 24/7 and the technology that enables this is increasingly available in the third world, let alone in the rest of the developed world. Access to talent is becoming more universal and new challenges are arising in the development and protection of intellectual property, and indeed in the globalisation of markets. Competition now arises in many forms, and organisations must be increasingly agile and known to, as well as connected to, their markets.
Explosion in choice favours the buyer
The cloud market has a diverse and growing ecosystem of vendors each seeking to establish a position of trusted supplier to a common customer. They have evolved from various markets ranging from traditional software developers now offering SaaS [software as a service] equivalents, to local value-added resellers offering hosted IT services, to telco’s offering converged voice and data solutions, all the way through to new cloud services providers built to specifically address the new market demand. This proliferation of choice and the associated convergence of markets will in the short term risk confusing the market, but will bring about consolidation and ultimately drive significant price benefits to the customer.
The challenge facing those people whose role it is to set out and implement IT strategy is not whether to embrace cloud as an effective deployment model, but where, when and how. A new era in the distribution of IT across multiple deployment models that are owned, hosted and/or based in the cloud now exists. Achieving clarity of focus in an IT strategy that leverages the economies and flexibilities that the new deployment models afford and sustain governance and control through effective and holistic reporting and management solutions is the new challenge for IT professionals.
What we currently call “cloud” is definitely here to stay, even if the name itself may wane with time. Its influence on innovation is arguably only just beginning to emerge and, when combined with the impact of mobile and social trends, it will undoubtedly continue to disrupt the market for many years to come. But that disruption will build more robust, dynamic and sustainable businesses.
Andy Burton is a non-executive director of Outsourcery and Concorde Solutions, and former chief executive of Fasthosts Internet and director at 1&1 UK; he founded the Cloud Industry Forum in 2009.