In a recent post, Bernard Golden, one of the most respected thought leaders in the cloud space, asked the question: “Has cloud computing been a failed revolution?” He conveys the observation that Google search traffic for the term “cloud computing” peaked in 2011 and has trailed off since then.
It’s also notable that much of the excitement seen in the trade press and by analysts has shifted to the “Internet of Things” and “digital enterprise.”
Just because there’s less of a spotlight on it doesn’t mean that cloud has diminished in strength and appeal. If anything, it is becoming a necessity for organizations, just as phones and electricity are necessities. Bernard notes that “I certainly don’t think that cloud computing adoption is finished. Far from it. In fact, I’d say most IT organizations have barely started working with cloud computing, much less completed their journey.”
But IT is but one small piece of the cloud story. A much bigger story is coming from the business itself. The curtain is now opening on cloud computing’s second act, which is all business. But this is also the hard part.
The business as a whole is only beginning to grasp the advantages of cloud beyond IT efficiency. Over the past three to four years, cloud has been well-established as an IT solution, providing compelling approaches to managing key applications, collaboration, storage and processing power. In this capacity, the costs and returns of cloud are fairly easy to measure and thus, present to the business. Moving a certain application to cloud means saving X amount of dollars, or saving X amount using dynamic, on-demand storage versus buying entire systems.
Now, in this next phase of cloud, the emphasis is shifting to its value as a business solution. This is where it gets tricky to measure costs versus returns. Traditional measures cannot capture cloud’s impact on agility, customer satisfaction, business transformation and workforce satisfaction.
So, where’s a good place to start to measure cloud’s direct value to the business at large?
A few months back, researchers at the IBM Center for Applied Insights did set out to establish data on the business advantages of cloud. Notably, their study of 802 enterprises found that those taking the lead in cloud benefited from better decisions, and 170% more likely to use cloud-based analytics extensively to derive insights. Strategic reinvention was another benefit — cloud leaders were 136% more likely to use cloud to reinvent customer relationships. Deeper collaboration is another key advantage directly attributable to cloud — cloud leaders were 79% more likely to rely on cloud to locate and leverage expertise anywhere in the ecosystem.
But take things a step further, and consider how cloud means even a deeper impact. In a recent report by The Economist Intelligence Unit, Mark Ridley, director of technology at recruitment website reed.co.uk, suggests that cloud is helping to reorganize businesses, from hierarchies to networks. Rather than a typical hierarchy, “the network structure requires groups, or squads, of specialists and experts who are defined as much by their own skillsets as the relationships and contacts they have with other groups in the business.” Organizations are functioning as self-directed teams, and cloud offers the ability to secure any and all resources as needed, without the need to clear decisions through a central authority.
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