Enterprises shifting focus to transformational benefits of cloud: Infosys survey

More than half of large enterprises are embracing a cloud strategy to drive digital transformation while 94% of organisations already have an enterprise-wide cloud plan in place, according to a survey by IT services firm Infosys.

Enterprises are gradually shifting focus from incremental to transformational benefits of cloud while increasingly opting for multiple cloud vendors across multiple platforms whether private, public or hybrid cloud models, the survey stated.

"At the beginning of the hype cycle, a lot more gets said about technologies than what gets done on the ground,” Narsimha Rao Mannepalli, executive vice president and head of cloud and infrastructure at Infosys, told TechCircle. “However, over the last two years, we see continuing momentum in cloud adoption and it will accelerate over the next three years." 

The findings are part of Infosys’ annual cloud survey. It drew participation from 876 executives representing both technology and business functions at organisations with more than $1 billion in revenue across the US, Europe, Australia and New Zealand.

"When we talk about cloud adoption at large enterprises, private cloud adoption also needs to be taken into account, which is fairly reasonable," Mannepalli said.

According to the Infosys survey, 45% of the respondents stated that a cloud strategy exists only as a guideline and business functions or regions have flexibility to develop their own programmes.

Cloud adoption is primarily being driven by emerging technologies (50%), competitive activity (49%) and reduction in overall IT costs by leveraging pay-per-use models (45%).

“Cloud initiatives have mushroomed across the enterprise as businesses recognise the inevitability of cloud computing in their quest for digital transformation," Mannepalli said. adding that cloud computing was not an infrastructure play for system integrators like Infosys.

"For digital transformation initiatives, cloud is not an option but a necessity as all new technologies like AI and data analytics leverage a lot on cloud. And if you don’t deploy these technologies, you will get disrupted with competition coming from unknown and unrecognised players in the industry and these technologies become a competitive differentiator," Mannepalli said.

The survey also identified enterprises as torchbearers, pathfinders, defenders and aspirants based on their cloud thinking and behaviour. Half of the enterprises were identified as Torchbearers, where there is high adoption of cloud across functions and an endeavour to be fully integrated as a cloud-first organisation.

Around one-fifth of the enterprises were identified as Pathfinders that have moderate cloud adoption while actively seeking to derive more business value from the cloud. Another one-fifth understood the importance of cloud, but had a siloed approach and were unsure about how to derive business value from the technology.

More than half of the companies said that they expected cloud adoption to deliver an enhanced experience to customers and other stakeholders, while standardising and integrating the technology landscape across the enterprise (50%) was the second biggest expectation, the survey found. Aligning legacy systems (59%) was mentioned as the top challenge while implementing cloud.

"We will see multiple challenges emerge, but investments in cloud transformation initiatives by enterprises have demonstrated long-term benefits as they aspire to win the digital race and achieve significant business performance improvements by building a robust cloud ecosystem,” Mannepalli added.  

Infosys said that over 61% of enterprises have 25-50% of their workload on the private cloud, while 21% have more than 50% of their workload on it. Among sectors, manufacturing, financial services & insurance (BFSI), and consumer goods, retail and logistics industries are fast adopters of the cloud and have a high percentage of respondents who are torchbearers and pathfinders, Infosys said. 

The survey also highlighted that business leadership (50%) plays a significant role in defining business outcomes from cloud transformation programmes.