Extensive digitalization, increasing market demands, and the shift towards agile have compelled 21st century enterprises to adopt disruptive tech forces – and transition to Cloud processes. In fact, the growth in Cloud computing has been five times more rapid than the overall expansion of the IT sector.
According to a 2015 survey by RightScale, currently 93% of businesses are harnessing Cloud technology to boost IT efficiency. Cloud adoption can drive several pan-enterprise benefits:
- Innovation: Build, implement, and manage next-gen applications and extend SaaS apps with custom code
- Standardization & Efficiency: Create value, enhance productivity, and drive efficiency by streamlining workload execution
- Scalability: Expedite organizational growth to quickly meet business demands
- Competitive edge: Facilitate smarter and accelerated decision making, without increasing Capex spend
Enterprises must tread cautiously when incorporating Cloud-based solutions
Enterprises must tread cautiously when incorporating Cloud-based solutions – resisting the temptation to jump on the bandwagon without proper market assessment and current state evaluation. It is, therefore, vital that organizations weigh a number of parameters - like security, deployment/maintenance costs, and utilization requirements - before embracing Cloud.
Cloud migration is an easier proposition for small to medium-sized businesses (SMBs)
For instance, cloud migration is an easier proposition for small to medium-sized businesses (SMBs) - and they have been aggressively making the shift. The European SMB Cloud Service market is expected to be worth €30.1 billion by 2018, expanding at a 17% compound annual growth rate (CAGR). SMBs are taking the lead when it comes to Cloud adoption, ahead of larger organizations, as a result of two major factors –
- Data integrity and compliance concerns are less complex as a result of the localized nature of SMBs. On the other hand, enterprises with a larger global footprint face a plethora of regulatory as well as security hurdles across geographies.
- Smaller firms enjoy the flexibility of modifying business processes in alignment with Cloud technologies - large organizations are often averse to change as their processes are long established and monolithic.
Yet, the potential of Cloud adoption extends beyond SMBs. In fact, even smaller units have to overcome multiple roadblocks, such as budgetary constraints. If they try to build a Cloud service offering on-premise, their operational expenditure will definitely shoot up. As a result, SMBs tend to channel their attention on core competencies, focusing on services beyond the ambit of Cloud providers, like desk side support.
On the other hand, larger enterprises, in spite of having adequate resources to develop on-premise solutions, might choose not to disrupt traditional processes and systems. Instead, they choose to re-direct their capabilities towards primary business operations.
The answer to the question whether companies should invest in Cloud, or develop on-premise solutions is complex and multi-layered. Considering broader organizational goals, here is a comparative look at the two approaches –
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On-Premise vs. Cloud |
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Top Drivers |
On-Premise |
Cloud |
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Functionality |
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Capability |
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Cost |
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Maintenance |
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System Management |
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While both on-premise and Cloud systems present unique benefits and challenges, the latter seems to have an edge over the former. However, the mere assertion of this fact cannot substantially motivate Cloud migration. Implementation of Cloud computing – whether for SMBs or for larger businesses – is a complex process that has to be bolstered by future-ready planning and outcome-driven strategies.
