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The benefits and pitfalls of the race to cloud computing

Some 89 per cent of UK business leaders reported the coronavirus pandemic has accelerated their move to the cloud, and without it remote working and business agility would not have been possible

In just 12 months since the pandemic hit, use of the cloud for business has soared. According to the 2021 Hybrid Cloud Report from NTT, 94 per cent of decision-makers across 13 countries saw it as critical to meeting immediate business needs amid COVID-19 uncertainty.

The research found 61 per cent of organisations globally were already using or piloting hybrid cloud, a mixed infrastructure of on-premise, private services and a public cloud.

There’s no doubt that, without this technology and the tools to speed up or scale its adoption, the surge in remote working would not have been possible

Clothing retailer Matalan, for example, was able to take advantage of the cloud for business positives. 

Head of logistics Paul Kee explains how it was able to scale its cloud-based warehouse management system (WMS) when its high-street and retail-park doors shut. 

“When the pandemic hit and stores closed, Matalan accelerated its ecommerce capability, quickly turning a plan into reality and enabling sales despite significant limitations,” he says. 

“The upgraded cloud-based WMS enabled Matalan to adapt processes and split the pick face between retail and ecommerce, ultimately giving better control over replenishment and reducing the frequency of running a replenishment process. This had the knock-on effect of reducing ‘out of stocks’ and improving speed to market on ecommerce orders due to more advantageous cut-off times.

“With ecommerce growing more than 25 per cent per annum, the ability to cater to customer expectations was paramount to ensuring exceptional buying experiences. In large part as a result of Manhattan Associates’ cloud-based WMS, Matalan was able to gain improved data availability and stock visibility, empowering better and quicker decision-making, allowing us to offer customers more flexible, online delivery options.”

How smaller companies increased cloud for business use 

Another company owner to reap cloud for business rewards was Tim Peniston-Bird, of customer loyalty agency Orangutan, and training and events company The Holt. He explains how cloud really came into its own when COVID struck, especially when using it to deliver theory lessons remotely to attendees quickly and effectively.

“The pandemic has increased people’s comfort with online activity so a larger amount of content will move into the cloud,” he predicts. “We are increasingly looking to use virtual environments and a mixture of team tasks and artificial intelligence avatars to boost learning where people can practise approaches in a safe online environment.”

And this situation is clearly not uncommon. According to Twilio’s State of Customer Engagement Report, which surveyed 2,500 enterprise decision-makers globally, 89 per cent of the 300 UK business leaders surveyed reported that COVID-19 had accelerated their move to the cloud.

A key reason was to give customers a greater number of digital routes to engage. Before the pandemic, UK respondents to the research had said less than half (48 per cent) of their organisation’s customer engagement was digital. Now that has increased to 62 per cent. Four in ten also suggested revenue would be lost if their customer engagement was not digitalised. 

Peniston-Bird experienced this first hand. “During this period, we increasingly integrated much more of the customer experience into cloud systems. For example, in a customer loyalty programme for a housing association, requests to area co-ordinators can be entered, logged and answered within a system, people can book gas safety inspections, volunteer, make suggestions or complete engagement surveys,” he says.

Security and backup are still cloud for business concerns

However, it has not all been plain sailing. Research by Unit 42, a global cyberthreat research arm of Palo Alto Networks, suggested the rush to cloud computing has allowed security vulnerabilities to proliferate, often because admin privileges were not stringent enough. 

This meant any hack could risk sensitive data being leaked and Unit 42 even found new cloud infrastructure was being hijacked to secretly generate cryptocurrency. It claimed at least 23 per cent of organisations globally that maintain cloud infrastructure were affected by  so-called cryptojacking.

Alongside security concerns, the resilience of information in the cloud has also been a critical consideration. StorageCraft research found 61 per cent of organisations had increased investment in cloud back-up use and 28 per cent also implemented data recovery plans that relied on the cloud. 

For many though, the pandemic has simply speeded up use of cloud for business, a growing need they were already in the process of adopting anyway. 

Mike Hampson, chief executive at Bishopsgate Financial, who increased its cloud use to service the needs of his 45 colleagues, says: “The pandemic accelerated that journey, especially when organisations pivoted industry-wide to working from home, fully embracing cloud-based collaboration tools. 

“Also, with personal interaction severely curtailed, all our clients followed suit, renewing their drive to providing cloud-based digital solutions for their clients.”

Sharing a number of lessons he learnt along the way, Hampson adds: “A few things should be incorporated into each organisation’s plans. From the outset, adopt a multi-cloud strategy when deploying to ensure resilience. Importantly, focus on the customer journey and experience when developing digital solutions. 

“Additionally, all too often, ageing software and hardware platforms are maintained as critical or key components, severely impacting productivity and efficiency. Legacy platforms and systems should be constantly pruned and decommissioned to ensure you don’t end up with legacy tech debt.”