All organisations will move to the cloud. Whether they’ve already started adopting cloud technology, are in the midst of planning to do so, or can’t quite fathom the change just yet, it is inevitable at some point in the not-so-distant future.
Given this inevitability, it’s no surprise that as far back as 2015, a Cloud Sherpas Enterprise Cloud Report found that cloud technology was a key part of the IT strategy for 82 per cent of organisations worldwide. Fast forward to 2023, and it’s revealed by Flexera research that 87 per cent of companies now have a multi-cloud strategy in place.
But why is cloud adoption so inevitable? What’s driving organisations to make this move? There’s actually a strategic reason behind every cloud adoption effort, and identifying and prioritising reasons, also known as cloud drivers, is the key to success in developing and executing your cloud strategy.
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In order to achieve the desired results from cloud solutions, you need to understand why you’re adopting them in the first place. This might seem obvious, but more often than not organisations fail to identify their cloud drivers in a documented strategy.
Having this information clearly outlined as part of a cloud strategy is important because it will help keep the cloud journey on track. With all of the ‘shiny objects’ that abound in the cloud world, it’s easy to get sidetracked from the original vision and goals. Identifying and documenting cloud drivers from the start will help you stay true to that vision.
It will also help to prioritise any conflicts among drivers. The more a cloud programme is built out, the more drivers will be identified. Over time, these drivers might come into conflict with one another.
For example, if a business wants to cut costs, it might end up inhibiting growth or hurting customer experience. As it identifies its cloud drivers, it should also prioritise them so that it has a clear answer as to which one takes precedent should any conflicts arise. This prioritisation not only eases the decision making process in these cases, but it also ensures consistency.
With all of that in mind, what might an organisation’s cloud drivers look like? When you boil it down, there are six main drivers for cloud adoption: three business-focused drivers (business growth, efficiency and experience), and three tech-focused drivers (agility, cost and assurance). Here’s what you need to know about each one.
1. Business growth
Business growth is one of the top benefits organisations realise as a result of cloud adoption. According to the Infosys Cloud Radar, cloud adoption can boost profit growth by as much as 11.2 per cent.
If you identify business growth as a cloud driver for your organisation, you also need to decide how you will define growth. For example, will it be increasing sales or gaining market share? The answer should depend on the maturity of your business. Based on that answer, you then need to outline your plans to achieve that goal and determine how cloud technology will help in that pursuit.
Efficiency is an extremely common cloud driver, with over 70 per cent of organisations worldwide ranking it a top area they hope to approve through cloud technology. At its core, efficiency is about removing unnecessary steps to streamline processes in order to increase productivity or deliver on customer requirements faster. As a result, increasing efficiency also supports business growth (by increasing worker productivity to handle more work at scale) and experience initiatives (by fulfilling customer needs faster).
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Next among the business drivers is improving the quality of the customer experience. Cloud infrastructure allows for analysis of data across multiple sources using multiple tools, as well as segmentation based on customer behaviour for personalised experience and interactions.
Two of the most common ways organisations are boosting the customer experience in the cloud are by introducing new channels of engagement; and improving workplace productivity.
However, the experience driver can come into direct conflict with goals around cost and efficiency. For example, if you introduce an automated phone tree for customer service, you might cut costs and increase efficiency, but your customer experience will suffer.
Businesses need to ensure that automated systems stay intuitive in response to evolving and specific customer needs. This is becoming increasingly achievable as consumer-facing artificial intelligence (AI) capabilities, including generative AI, have grown over the past year.
Improving IT agility, or enabling IT to be more responsive to business needs and react faster to market changes, is a top technology driver for over 60 per cent of organisations worldwide.
This goal is very attainable in the cloud environment, as the rise in software-as-a-service (SaaS) technologies means that IT no longer needs to be consumed with traditional application management tasks. Cloud technologies are also easier to enhance and swap out to accommodate changing business needs.
That said, it’s important to recognise that the cloud environment requires a new set of IT skills around managing and brokering these products. Additionally, while increased agility can benefit the internal customer experience by making it easier to introduce new technology that users want, it can also harm it by diluting IT’s ability to provide expert support. After all, the more technologies in play, the more IT has to master.
The cost driver has two sides: reducing IT expenses and restructuring these expenses to spread them out over time thanks to the licensing model of SaaS technologies. While businesses do consider reducing IT expenses a key cloud driver, cost may often take a backseat to other cloud drivers as organisations typically choose to reinvest any savings to help achieve other goals, such as increased agility and improved experience.
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Finally, there is assurance, which is the idea that data will be more secure in the cloud and the user will attain better uptime because its solutions are maintained by providers that have built their businesses around these competencies.
As a result, it’s no surprise that over 70 per cent of organisations report that IT has benefited the most from adopting cloud technologies. Although organisations in highly regulated industries do need to be more cautious here to ensure they maintain compliance, the cloud is still a viable option. In general, the benefits provided by assurance can also help further initiatives around IT agility.
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Before beginning any new cloud initiative, it’s essential to identify which of these six possible drivers is behind a decision to move to the cloud. Businesses also need to prioritise it against any other drivers they have identified as part of their cloud strategy. There is no one-size-fits-all when it comes to cloud adoption, and proper alignment with specific organisation needs is crucial.
As outlined above, analysis of drivers is essential to success, because it will help keep activities focused on the desired end goal, and make it easier to resolve any conflicts between drivers when they arise.
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