It’s all about the data: Hybrid IT enables customer adoption of Cloud Computing

Greater transparency and trust in the market is breaking down historic resistance within organisations to migrating applications to the Cloud. This is according to the latest research into Cloud adoption trends in the UK by the Cloud Industry Forum (CIF).

The research, conducted in Q3 2013 polling 250 senior IT and business decision-makers, is the fourth annual body of research to determine the levels of Cloud adoption and to gain insight into attitudes, experiences and trends across the UK end user community.

With 69% of organisations formally adopting at least one Cloud-based service within their business, and satisfaction with the use of Cloud-based services standing at 91%, the upward trend toward Cloud-based service provision remains on the trajectory first identified by CIF in 2010.
However, barriers to adoption do remain and do need to be overcome in the minds of decision makers. As an integral part of this research programme CIF evaluated deployment models within the IT estate. The research highlighted that the majority of organisations (86%) still operate an on-premise server room or data centre and as such are investing in on-premise IT when they make a Cloud service decision. The rise of the Hybrid environment appears to have arisen as a direct response to some of the concerns and barriers to Cloud adoption.

Key findings include:
• There are a number of applications that are not yet being as widely accessed as a Cloud service. These include accounting and finance (67% of the sample), personnel and payroll (63%) and office automation and productivity tools (54%).
• The primary reasons for not migrating specific applications to the Cloud included perceived loss of efficiency and control at 53%, data security concerns at 52%, pre-existing investments made in on-premise solutions at 41% and uncertainty over data protection obligations at 40%.
• When asked what data their business would not migrate to the Cloud it comes as little surprise, based on empirical trends, that employee information came out top at 56% with accounts and financial data cited by 50% of the sample.

Andy Burton, Founder of the Cloud Industry Forum, stated: “A significant and positive development in the battle against the fear, uncertainty and doubt (FUD) is that organisations are becoming far more savvy around the issues of data management in regard to security, protection, location (sovereignty) interoperability and portability. For example, whilst concerns remain very high in regard to local storage of data vs international, the number of organisations that perceive they have a regulatory requirement to store data locally has reduced to 37% from 44% in late 2012.
“Taking a closer look at the results, when asked if any application areas required data to be stored in a specific location, whilst a wide range of solutions still scored quite highly, it was pleasing to note that in aggregate all application areas saw a decrease in perceived risk over the past 12 months,” he added.

When it came to the interpretation of where the data was required to be stored, 84% of respondents who believed that they had a restriction or obligation to store data in the UK, with half of those (48%) still preferring to keep some form on-premise and the balance of 36% being hosted in the UK.

Only 13% of organisations believed that they could store their data elsewhere in the EEA, despite being under the same umbrella legislation, and only 2% saw regions outside the EEA as acceptable.

Burton concluded: “Perhaps most telling is the clear balance of opinion that is forming in the market. Whilst 78% of organisations now actively seek if any new IT project could be delivered as-a-service, reinforcing that cloud is a viable and credible IT delivery platform, it is also important to note that 50% of firms also do not ever see themselves moving everything to the cloud. Only 12% of firms believe a wholly Cloud-based IT delivery model is possible today. The conclusion is self-evident: IT will become an increasingly hybrid platform of on-premise and Cloud services for the foreseeable future.”

Alex Hilton, CEO, Cloud Industry Forum, continued: “The most significant concerns expressed during the decision-making process to migrate to the Cloud revolve around one word: data. Its security was referenced by 69% of the sample, while its privacy stood at 51%. Outside of that the dependency on internet access (37%) and even a perception that the organisation would loose control (36%) dominated the end-user mindset.

“Drilling into the findings we also see that many organisations did experience some difficulties in their first migration to a Cloud service which in a number of cases was expressed in terms of lost productivity during implementation, delays in time to market, and to a lesser extent, some negative impact on the customer experience. That said, 91% of end users remaining satisfied with their Cloud service decision, and 40% of the end users that experienced any issues believed that they will be able to implement further Cloud services more cost effectively in future. It is perhaps no surprise then, that adoption has once again risen over the same period last year and is projected to continue to grow healthily,” concluded Alex.

The research once again asked end users if they would source credible Cloud Service Providers, which are publically certified against an industry Code of Practice, and the overwhelming majority (65%) stated that this was of value.