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Is business reluctant to jump on the cloud?

April 7th, 2011 1 comment

This is a guest post.

Graham Turnbull is a freelance writer based out of the UK and writes engaging and detailed content for several leading websites. He is currently working on behalf of leading Cloud Computing firm Joyent.com.

Cloud computing is an IT manager’s dream which allows firms to create new virtual server environments in minutes according to Mike Klein, president of Online Tech who describes his decision to go “all in” to cloud computing as one of the best moves his company has ever made. He pointed out that he’s now able to offer the same levels of service with only one tenth of the physical equipment that his organisation used previously. However, many other IT decision makers are more reluctant to jump aboard the cloud.

A survey from ITC service provider 2e2 found that 57% of businesses are undecided about whether cloud services are suitable regarding their needs and they are finding it difficult to come to a decision as to how to implement these facilities. That’s not to say that IT managers are ignorant of the benefits of adopting the cloud, 91% of companies questioned said that they would like to see a hybrid or blended model of the cloud. 2e2 say this shows that they have insight into the benefits of the cloud but are unsure about handing over so much of their remit over to an off-site third party.

Nathan Marke, 2e2’s chief tech’ officer also said: “It’s clear the vast majority of businesses understand the different options that are available. However, with so much hype around cloud and its various incarnations, these organisations don’t know which model is right for them and how to go about implementing it.”

His contention runs that the concept is understood but industry needs to be made to understand how and what it can do for them when it’s taken advantage of.

Another organisation which is picking up cloud services is the British government. Whitehall has migrated much of its back office over to the cloud as it conforms to many of the government’s targets concerning reducing costs and carbon emissions. A Unit4 survey of 700 organisations’ attitudes toward included 123 public sector departments, 54 of which were based in Britain. They too found that the hybrid (a mixture of public and private clouds) model was achieving dominance and that the cloud would occupy decision making concerning IT and communications for the next decade. Notwithstanding the advantages offered by the cloud, only 2 of the 123 public sector organisations declared that they were 100% cloud based.

Perhaps timing is the issue here; a quarter of the 700 said cloud computing would account for between 25 and 50% of back office in ten years time. Seventeen percent said that they would put that amount of cloud use higher, at between 50 and 75% in a decade. Those who said that they would be taking up cloud services among the public sector sited ease of ITC maintenance, automatic updating and the ease of set-up as their top three reasons for adoption.

Anwen Robinson, MD of Unit 4 chose to take a positive view of the results of Unit4’s data saying that: “This survey shows that the public sector is steadily moving towards Cloud computing at the same pace as the commercial sector.” Which is a nice sentiment but in reality 48% of the original 700 organisations surveyed said that they have no cloud at all and 43% say they haven’t so far made any plans to do anything about it either.

While Unit4’s survey was of 700 organisations based throughout the world Microsoft conducted a more targeted survey when they were interested in manufacturing and the cloud, they asked organisations in France, Germany and the US and found that the cloud was ‘transforming’ business.

The number of manufacturers wanting to take advantage of the cloud is growing as the reduced infrastructure costs and the related issues of IT structure are making the cloud look like a tempting offer.  48% of industry respondents said that reduced costs were their primary reason for making the change, almost as many said that the cloud would be necessary for multi-regional and international collaborations and 38% believed that it would be important to them when it came to reacting quickly to future business demands.

Sanjay Ravi MD and commissioner of the Microsoft Discrete Manufacturing Cloud Computing Survey 2011 said: “Manufacturers are exploring ways to improve product design with social product development, enhance visibility across multiple tiers in the value chain and create new business models and customer experiences based on smart devices connecting to the cloud.”

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