Although cloud services still make up a minority of business IT spending there’s no doubt the way organisations think about cloud has changed.
Cloud is a likely first step when thinking about introducing any new software or service. Where once IT directors would consider farming out certain services to cloud providers if there were specific difficulties with hosting them in-house now the opposite is true – we’re moving to a cloud-first world.
But the figures showing high percentage growth for public and private cloud are misleading – these still make up a minority of overall technology spending so they’re growing from a lower base.
The world of hybrid IT is not disappearing just yet.
The benefits of the on-premises data centre remain strong. Equally there are still real difficulties, both practical and regulatory, to shifting some systems and services to the public cloud.
The reasons for choosing cloud are also changing.
Where once the primary driver was cost today businesses are choosing the cloud for speed and scalability.
The early cloud winners were providing bread and butter services like storage or back-up where demand was predictable and cost savings of primary importance.
Although cloud providers can sometimes offer a comparable service for less the real benefit for business is that they can provide instant access to more infrastructure.
In a world of accelerating digital change the ability to instantly switch on servers and storage is just as important as how much they cost.
The driver for cloud is now scalability not just savings.
The scales are also shifting because of changes to how IT hardware and infrastructure can be bought and used.
Enterprises can deploy hardware in ways that are much more like how they can switch on cloud services.
Hyper converged systems which allow applications to call up resources as required fundamentally change the possible return on investment and utilisation rates for on premises hardware.
Pay per use purchasing models allow data centres to come very close to competing on cost with the public cloud.
Several enterprises have seen costs rise as cloud-based services or even individual applications scale to the point where they can be more cheaply provided in their own data centres.
The real strategic challenge of cloud is not how much of a role it plays within the organisation but how to effectively manage that cloud use.
Dealing with an organisation’s various providers, and keeping an eye on other IT costs, demands sophisticated management systems.
The danger of corporate cloud contracts is that they’re treated like an unavoidable monthly expense. Keeping on top of service level agreements and costs can too easily become an impossible management task.
The IT department needs systems which enable them to manage all these systems and costs whether they provided by an internal data centre or a distant cloud provider.
That will allow IT to become a broker of services for the rest of the business rather than just a provider. This will also bring shadow IT back under control and provide a strategic steer for developing technology for the whole business.
