Increasingly, progressive organizations have digital transformation at the heart of their innovation and growth agenda. They are in different stages of adoption of one or more technology prerequisites such as artificial intelligence, internet of things, intelligent automation, advanced analytics or blockchain. However, to effectively utilize any of these at scale, a hybrid cloud environment that comprises of a combination of public cloud, private cloud or on-premise models is a necessity. Hybrid environments enable organizations to leverage the rapid scaling ability of cloud while ensuring critical data security at the same time.
It should come as no surprise that according to Avasant’s Hybrid Enterprise Cloud Services RadarView™ Report 2018 the hybrid model has become standard over the last couple of years. Over 80% of Global 2000 enterprises have already adopted and scaled it as common fears in the early stages of enterprise cloud adoption surrounding efficiency and security have proven unwarranted. Enterprises are now accelerating even business-critical workloads to public clouds. In fact, the advent of multi-cloud environments, where organizations leverage multiple public and private clouds, is rapidly growing. Over 60% of hybrid environments currently leverage multiple clouds.
Cloud Service Providers are also launching features and functionalities related to machine learning, artificial intelligence, robot process automation and blockchain on their platforms. This provides further impetus to cloud-first organizational digital transformation initiatives. They are also using new technologies and methodologies, such as containers and cloud native app development, which ensure smooth transition of applications between cloud platforms, thus providing even more flexibility to organizations.
While cloud adoption is driving a lot of innovation, organizations need to be cognizant that its pay-per-use model, if not managed efficiently, can lead to extreme cost escalation. According to Avamark, an industry leading benchmarking tool, cloud costs can spiral over 2.4 times the initial budget in the absence of spend controls. Thus, enterprises are now investing in proprietary or thirdparty cloud management platforms and in building central cloud teams with more brokerage and orchestration-focused skillsets.
Enterprises need to aim beyond just cost reduction and leverage cloud as an enabler of transformation. They will necessarily need to develop a cloud-first organization, driven through central cloud teams with cloud orchestration, spend management and advanced talent management in addition to core technical skills, to ensure business alignment and cost control, while still allowing business units the freedom to leverage multiple cloud services at scale. For more details on the current industry landscape trends and the road ahead, you can access Avasant’s Hybrid Enterprise Cloud Services 2018 RadarView™ Report here.
About the Author
Swapnil Bhatnagar has over 12 years of industry analyst and corporate strategy experience. Previously, he headed technology research for IDC, South Asia and expanded research in digital and emerging technology space. He has previously led BPO research at Everest Group where he advised both global enterprises, service providers and PE firms on F&A, procurement & recruitment process outsourcing strategy and operations.