Cloud computing—originally seen as offering mostly tactical benefits through lower costs, flexibility and scalability—is rapidly being seen as a key component of corporate strategy, according to study by Oxford Economics.
The report of Oxford Economics' research 'Path to Value in the Cloud' says the research shows that the cloud already is central to strategic vision and operations, and that its influence is growing rapidly. "Operational efficiency, once seen as a key driver for moving to the cloud, is becoming less important as the focus shifts from a utility mindset to a more strategic cloud framework."
In support of this contention it lists key findings of a survey of 350 executives:
- Over half (53 percent) of respondents say cloud is a key to their innovation strategy, and nearly three-quarters (71 percent) expect the cloud to be part of the long-range vision for their business in two years.
- Geographic expansion and new lines of business are seen as key goals enabled by the cloud. Within two years, use of clouds to drive entry into new markets will increase by nearly 50 percent.
- Collaboration among business units (63 percent) and partners (59 percent), innovation (55 percent), and improved customer service (44 percent) are valued over increased efficiency (33 percent) and operational savings (36 percent). Time to market (52 percent) and business agility (50 percent) are also key drivers.
The report says the impact of the cloud will increasingly define the enterprise and IT over the next two years. "The burgeoning industrial Internet and the Internet of Things, and the cloud [will serve as] a hub for a wide array of processes and events.
"Clouds are fast becoming the structural foundation that supports mobility, collaboration, social media, and a spate of other key business functions such as ERP and e-commerce. What’s more, as enterprises find themselves pressured by multiple factors—including changing technology, industry consolidation, growing regulation, and rapid globalization—there is a need to speed decision-making and act in a more agile and dynamic manner."
The report contends that cloud allows organisations to respond and grow in the face of these challenges. [Cloud offers] an opportunity to move to a flexible and often state-of-the-art IT environment without undergoing a long and arduous purchase process and allows organisations to stay current with technology by virtually eliminating patches, upgrades, and many other tasks associated with traditional IT."
It adds that the incremental gains derived from individual cloud services pale in comparison to the returns possible within a highly integrated cloud framework. "New products, services, and approaches to business are on the way.Those companies that are quick to develop migration strategies, learn to measure value, and pursue their business vision through the cloud are likely to see quantifiable improvements in financial performance and operational efficiency."
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