You're doing cloud wrong: 99% of companies aren't optimized, says new study

A Cisco-sponsored study by IDC said that the second wave of cloud adoption is imminent. However, it indicated that most businesses aren't taking advantage of cloud the way they should be.

Image: iStockphoto/SlobodanJr

Whether public, private, or hybrid, more and more companies are investing in the cloud. But, there's a problem: 99% don't have an optimal strategy for adoption.

This is one of the main points of a Cisco-sponsored study that was released on Wednesday. The study, officially titled "Don't Get Left Behind: The Business of Achieving Greater Cloud Adoption," was commissioned by Cisco to IDC.

IDC surveyed 3,643 IT decision makers across 17 countries for the results. The respondents work in companies that are currently implementing private, public and hybrid clouds in their IT.

While the 99% number is significant, the main takeaway was the idea that the enterprise is moving into what the the study calls the "second wave" of cloud adoption where organizations are adopting cloud as a means of driving business outcomes. However, not everyone had clear strategies on how to get there.

According to the study, cloud adoption strategies worldwide break down like this:

  • 32% - No discernable cloud adoption strategy
  • 32% - Ad hoc, cloud tools are adopted as needed
  • 11% - Opportunistic
  • 16% - Repeatable adoption strategy
  • 8% - Managed strategy
  • 1% - Truly optimized cloud strategy

"The big news is that only 1% of organizations worldwide are in this kind of optimized situation," said Fabio Gori, director of Cloud Marketing for Cisco. "Everybody else is still making and finding their own way forward."

Cloud adoption

There are three key performance indicators (KPIs) that are driving this cloud adoption. The first KPI is efficiency. Of the IDC study respondents, 77% reported an IT cost reduction and 72% said that the cloud had improved their ability to meet service level agreements (SLAs) with clients.

Speed was the next KPI with 99% of respondents reporting an improvement in the time it took to provision IT services. The final major KPI was disruption. The IT leaders who were surveyed experienced 10.4% revenue growth and 200% growth of strategic IT budget allocation attributable to the cloud.

IDC's CloudView study conducted in 2014 originally had a sample group of 19,080, of which these respondents were pulled, so there's no shortage of IT leaders embracing the cloud. While the cloud is not yet universally deployed in IT, we do seem to be at a tipping point, Gori said.

Among the respondents, though, there were some interesting trends in how the cloud was adopted. When asked what type of cloud they were currently using or planning to implement (users could choose multiple types), 44% said private cloud, 38% said public cloud, and 64% were looking at hybrid cloud.

Three distinct requirements were listed for hybrid cloud consideration:

  1. Portable workloads - 33%
  2. Security concerns - 47%
  3. Policy automation - 67%

When it comes to what providers these respondents were looking to, it was mostly companies they already knew -- 83% said they trust their major incumbent IT provider to provide cloud services as well.

Open source was also a key part of these cloud adoptions as 65% of the survey respondents said OpenStack was an important part of their cloud strategy.

Business Cloud Advisor

In an attempt to make the results of this study "actionable," Gori said, Cisco announced a new product in tandem with the results built off of the data gleaned from the survey responses. The Cisco Business Cloud Advisor (BCA) helps companies rate their cloud adoption level and gives them ways to improve it.

"It gives you a rough estimate of what is the financial value that you're leaving on the table if you're actually behind, or your competitive advantage if you're leading against your peers," Gori said.

According to the report, the BCA can help estimate improvements in revenue, cost to market, and time to market based on cloud adoption.

User companies are compared by geography, size, and industry to the roughly 3,400 companies across 17 countries whose leaders participated in the survey. The tool is literally built from the data collected in the IDC survey.

The web-based tool is composed of multiple parts including an organization profile, a section that shows gaps in cloud adoption, performance benchmarks, vendor-agnostic guidance, and recommended products to improve cloud adoption.

Gori said that the BCA is a tool that will help the Cisco salesforce and partners better sell cloud services to customers. So far, they've been working with pilot companies such as Enterprise Bank and Trust, Netelligent, and Presidio.

If users like what they see with the online BCA tool, they can schedule an accompanying workshop. The online assessment and the accompanying workshop are free. Both are available now.

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