Cloud and IoT - Digital Imperatives for 2016

If you’re among the elite IT-savvy senior executives — the most informed about the upside opportunities for digital business transformation — then I trust that 2016 is the year where you’ll likely make a quantum-leap past your competition.

But if you still think that your industry is ‘excluded’ from the current global market disruptions, then perhaps you should ponder this thought. Savvy leaders in the heavy-equipment industry already have a plan of action for cloud, big data and the Internet of Things (IoT) — so, can anyone be immune to this trend?

Consider the perspective of Caterpillar Chairman and CEO, Doug Oberhelman.

“At Caterpillar, we’re focused on the connectivity of machines and engines — the Internet of BIG Things.”

Cloud, Big Data and the Internet of Everything

Cloud enables IT agility, empowers DevOps teams and helps to transform legacy business models. The fifth annual Future of Cloud Computing survey investigated key trends in corporate cloud usage. This year’s insightful survey findings offer perspective from cloud service practitioners across all industry sectors.

“Cloud has been gaining momentum year­-over-­year since the Future of Cloud Computing survey was launched five years ago. Looking at the adoption rates and trends at such a detailed level, it’s undeniable that the most successful technology leaders of today and tomorrow are scaling in the cloud,” said Jim Moran, General Partner at North Bridge.

“Last year, we discussed the second cloud front and the rise of cloud­-native companies. This year, we’re seeing the pervasiveness of cloud disrupt industries across the board as companies look to maximize and implement cloud as a strategic and integral technology,” Moran added.

“We’re also seeing the emergence of the cloud as the only way businesses can truly get more out of their data including analyzing and executing on it in real-­time. This will be a huge opportunity, but as the survey showed, because data rarely moves between clouds (Public/Private) companies must first learn how to interconnect disparate data sources into new applications.”

Savvy business leaders are no longer debating whether or not to use cloud, but how pervasively they will use it in their digital transformation plans. The latest survey results highlight record levels of corporate adoption of cloud computing, both for business functions and in areas such as content management and application development in the cloud.

Even the most traditional IT teams are finally evolving. Some are taking back technology strategy from the forward­-looking Line of Business (LoB) leaders that led the way to progress. Therefore, North Bridge believes that digital technologies — delivered from the cloud — are becoming differentiating factors for more businesses.

Cloud is the Business Transformation Catalyst

  • Significant processing, systems of engagement and systems of insight are moving to the cloud ­­ — 81.3 percent of sales and marketing, 79.9 percent of business analytics, 79.1 percent of customer service and 73.5 percent of HR & Payroll activities have already transitioned to the cloud.
  • IT is moving significant processing to the cloud with 85.9 percent of web content management, 82.7 percent of communications, 80 percent of app development and 78.9 percent of disaster recovery now clou­d-based.
  • While business users have been a fan of cloud’s ease of use, accessibility and scalability since 2011, the importance of cloud agility has jumped from fourth to second in importance within five years.
  • Among all survey respondents, the top inhibitors to cloud adoption are security (45.2%), regulatory/compliance (36%), privacy (28.7%), vendor lock-­in (25.8%) and complexity (23.1%).
  • Concerns regarding interoperability and reliability have fallen off significantly since 2011 (15.7% and 9.9% respectively in 2015). However, the cost of cloud services are now three times as likely to be a concern today, versus five years ago.

Raised Expectations for Public and Hybrid Cloud

  • Today, three quarters of company data in significant volumes is living in private or public clouds. However, company data in hybrid cloud systems is forecast to double over the next two years.
  • Corporate cloud computing strategies are focusing on public (up 43.3%) and hybrid (up 19.2%) while private cloud has taken a significant back seat in comparison (down by 48.4%).
  • SaaS is the most pervasive cloud technology used today with a presence in 77.3 percent of all organizations, an increase of 9 percent since 2014.
  • Accordingly, ROI expectations are high with 78 percent expecting to see results within three months. Fifty eight percent expect ROI in less than three months for PaaS services.
  • Among users taking the survey, the biggest factors preventing use of public cloud offerings are security (38.6%), privacy (29.8%) and expertise (22.8%). Regardless, the outlook for ongoing cloud service adoption is very bright.

These are exciting times, indeed. During the rest of 2016, pervasive digital business transformation projects are going to shake-up every industry. Do you want to be one of the ‘insiders’ that’s tuned-in to all the current trends? Perhaps you don’t have time to seek out the latest market research. No worries — follow me, I’ll be your guide. Lookout for more insight from me in the coming months.

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