Organizations continue their headlong rush into the cloud – but the people they depend on to manage this adventure are in a scramble to keep up, and, indeed, may be losing control of the situation. That’s the gist of a recent survey of more than 1,071 IT managers and professionals conducted by ScienceLogic, which finds that fewer than one-third have the visibility and control they need to keep things in check. At the same time, cloud adoption is occurring at a faster pace than anyone could have predicted.
Photo: Joe McKendrick
Is this a bad thing, that cloud adoption is running away faster than organizations can control it? To enterprise administrators, yes -- it means potential unnecessary and duplicated costs, and security exposures. These are matters that require their full attention and resources.
There's also something bigger going on. The ubiquitous access to technology resources and services provided through cloud is providing almost unlimited opportunities for innovation at every level of organizations. The best innovation comes from a little bit of chaos, and every business concerned about its future wants a sprinkling of the magic dust.
The cloud explosion is exactly that, and it shows no signs of abating. The most recently available industry stats bear this out -- Gartner, for one, estimated that the worldwide public cloud services market was to grow by 17% to total $208.6 billion, up from $178 billion in 2015. Amazon Web Services saw estimated revenues of approximately $12 billion in 2016, a number expected to triple over the next three years. Microsoft says its "Intelligent Cloud" revenue increased $1.3 billion or six percent in the most recent quarter, and that Azure revenues were up by 113%. IBM just announced it had cloud revenue of $11.6 billion over the last 12 months. The company said it has a cloud as-a-service annual run rate of $6.7 billion in the quarter, up 50% year to year.
There is also insatiable demand for private clouds as well. A few months back, IDC projected that IT infrastructure spending for private cloud would increase by 15.5% in 2016 to reach $37.1 billion. Spending on private cloud IT infrastructure will grow by 10.3% year over year to $13.8 billion with more than 60% of this amount contributed by on-premises private cloud environments.
The volume of megabucks flowing toward cloud means enterprises are making enormous investments in the cloud paradigm. A sizable segment of respondents in the ScienceLogic survey, 42%, said they have 25% or more of their infrastructure in cloud environments today – up from 33% a year ago. Notably, the percentage with a majority of their infrastructure in the cloud, 23%, report having the majority of their IT assets in the cloud today – up from only 13% a year ago. Hybrid cloud is gaining traction as well. A majority of respondents, 51%, expect to be running applications within a hybrid cloud infrastructure two years from now. 14% expect to be operating a private cloud exclusively, and nine percent intend to be all public cloud.
Are these cloud investments being made wisely, and are achieving real business gains? Or are companies gobbling up cloud services and simply adding them to unwieldy and unnecessarily complicated technology infrastructures? The impact on business, real or simply hoped-for, is one concern. The other is whether the people needed to sort through and run these implementations can stay on top of this mass movement.
In one sense, cloud seems to be helping to reduce internal IT sprawl. A sizable segment, 40%, report their company’s data center footprint is shrinking compared to three years ago. However, one type of sprawl is being replaced by another. There is a growing blob of unused and underused service subscriptions that corporate funds are flowing into, with no ways to check or coordinate usage. Only 28% have a process to control public cloud sprawl. Only 37% have visibility into the historical performance of their public cloud services, and fewer than half, 44%, are able to verify the scope of their public cloud consumption.
But, again, while this is not a good situation for many, it is symptomatic of larger forces at work. The cloud revolution is freeing up technology for innovative and entrepreneurial opportunities, enabling people at all levels in organizations to pursue new ways of thinking and doing business. The chaos of multiple, unfettered cloud access may be the best route to disruptive innovation, versus attempts to control and confine it. A while back, I heard Michael Dortch, a highly regarded IT thinker, advocate for "MDM" in enterprises, as in "My Device Matters." Let me add MCM, as in "My Cloud Matters." Users know best what technology services they need, and IT departments need to adapt to that MDM/MCM thinking. Cloud provides avenues for teams of employees and partners to explore new vistas. Innovation springs from hundreds or thousands of minds collectively working on new ideas. Empowered teams seeking to design new products, new processes, or resolutions to problems have an abundance of cloud-based resources.
The key to success in this new climate isn't about technology, it's about management vision. The organization -- and its leaders -- need a forward-thinking, entrepreneurial culture that capitalizes on this computing power. Organizations that are restrictive, risk-averse and hierarchical are likely to find themselves overwhelmed and flying blind, forever fighting an endless battle to gain control over fast-changing technology forces.
This is the thinking behind the innovation labs many companies are supporting, in the hopes of capturing and bottling the energy seen with startups. Witness the way many companies in the staid and conservative insurance industry are buying or launching "insurtech" companies with the intentions of prodding their business lines with jolts of new electricity. These are efforts that can't be contained or controlled within restrictive hierarchies or infrastructures.
Technology changes so much from year to year that whatever enterprises attempt to tamp down and regulate this year will be surpassed by new developments the next. Witness the rise of mobile computing. Employees want to be part of the innovation story -- and technology paves the way.
Again, we see organized chaos as the new rule for business in the 2010s. The rise of cloud resources available to all is driving a new approach to delivering value -- open up technology to boost innovation, even if it is somewhat messy and hard to contain. To reiterate, innovation is very messy anyway.
