Managed Services And The Cloud: What Executives Say4:37 PM EST Mon. Mar. 11, 2013
It's no secret that managed services and the cloud are among the hot buttons of the IT industry these days. The opportunity to save money and convert capital expenditures into operating expenditures often prove to be highly compelling drivers for change to this new paradigm. Syntax is a Montreal-based solution provider focused on IBM, Oracle, and similar solutions that can deliver solid business value through the cloud and through managed services offered by the company. Syntax has issued an infographic based on some recent market research. Here are some of the key points from that infographic, combined with what we have gleaned from this constantly evolving market space.
More than 76 percent of senior finance executives say the cloud will be crucial to their company's strategies over the next 12 to 18 months. While moving to the cloud does not necessarily guarantee cost reductions, the ability to scale consumption, combined with the ability to offload major capital expenses, often provides a very compelling business opportunity. Look for an increasing number of companies to kick tires on cloud-based services, and increase their cloud adoption.
According to Syntax, a wide variety of companies are either moving to the cloud right now, or intend to do so within the next few years. To that end, the survey reports that 72 percent are making the move today, and 91 percent plan to make the move within the next three years. No doubt many of these customers will be looking to channel partners to help them manage the transition, and decide which types of data should be moved to the cloud.
Among firms that shifted to managed services: * 13 percent reduced their IT expenditures by 50 percent or more * 33 percent reduced their IT expenditures by 25 percent to 50 percent * 50 percent reduced their IT expenditures by up to 25 percent
The respondents suggest that substantial savings are frequently delivered. Of course, savings need to be viewed in the context of other key industry imperatives, such as ensuring secure storage and transit of data.
According to the data, 54 percent of IT professionals rank security as a top concern for migrating applications to the cloud. And while some industry researchers suggest that cloud security is moving in the right direction, there will always be plenty of challenges at the security level. Cloud infrastructure, by its very nature, will likely always be a major target for hackers and cyber criminals. Many companies are adopting a strategy wherein sensitive data is kept in-house, and less sensitive data is sent to the cloud.
According to Syntax, 85 percent of users are confident in their cloud provider's ability to deliver a secure environment. This is particularly true among the small to medium business segment, where resources may not fully support comprehensive security technologies and practices. Without cloud providers, many of these companies take a best effort approach to IT security. Cloud providers, on the other hand, recognize that their business strategies are largely dependent upon the ability to keep customer data secure. The stakes are high, but the competition is even higher, given that cyber criminals are equally aware of the opportunity at hand.
According to the survey, 90 percent of IT managers lack confidence in their companies' ability to detect problems. We can safely assume that a lot of these potential problems involve security, but the full garden variety of other glitches and errors might just as easily be included. Much of this is perception is likely due to the fact that businesses are primarily focused on their primary value proposition, and IT, for them, is a means to an end. This is particularly true in the small market and, to a certain extent, in the mid-market. But what might slip through the cracks can cause serious problems.
According to the research, here are the Top 5 benefits for adopting an IT Outsourcing model:
1. Free up the staff for more strategic initiatives 2. The ability to deliver projects that would be impossible with in-house expertise 3. Access to industry-specific expertise 4. Cost savings 5. Better alignment of costs with business needs
According to the survey, more than 70 percent of IT budgets are spent on operations and maintenance. Stands to reason that both the IT people and the folks in accounting would be pretty happy to drive down this percentage, and re-allocate the balance towards more strategic objectives. As both cloud and managed services continue to evolve, the winners will be found among the companies who can best transform this objective into reality.