Cloudpreneurs - McKinsey Reveals Fast Growth of Cloud Adoption

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At Technomy 2012 in Tucson , Bertil Chappuis, Senior Partner at McKinsey & Company, explored how cloud technology is helping to boost business.

His talk focused on the high trending growth of cloud services on enterprise, small businesses, and individual levels.

Using Newvem’s AWS cloud usage data, Mr. Chappuis covered rapid cloud growth.

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  • Cloudpreneurs - McKinsey Reveals Fast Growth of Cloud Adoption

    1. 1. CloudpreneursCONFIDENTIAL AND PROPRIETARYAny use of this material without specific permission of McKinsey & Company is strictly prohibited
    2. 2. Cheap computing + Small in-house server Small Public Cloud Instance $31.55/mo $16.06/mo McKinsey & Company | 2
    3. 3. Agility + INTAKE TICKET BUILD IT Manager assigns PROJECT MANAGER – Ongoing Engineer ARM contacts oversight and coordination Agency CIO Engineer builds VM Engineer installs & 4 configures OS High Level M Backup & Recovery Review Network Monitoring Second engineer Initial completes QA T Executive Review Engineer completes MVM Scan 1 Solution 6 Th up Review w s lo g ol etin F e SOLUTIONING CUSTOMER VERIFIES Contact AND DEPLOYS communication and coordination m M/W/F ns 3 PROJECT MANAGER – OngoingAgencies IT Infrastructure tio ra Engineering Ite Verify specs / stack Infrastructure T 2 engineers, 5 Deploy Agency business Final Review owners and SI design solution App Scan Iterations Project approved, PM assigned Verify Complete 60-150+ days Minutes McKinsey & Company | 3
    4. 4. New experiences = Social Rapid Local development / iteration Mobile Heterogeneous clients Cloud Bursty Big-data computations McKinsey & Company | 4
    5. 5. Entrepreneurial groundswellSalesforce.com Workday Workday Regional sales team HR managerIntermedia Intermedia AWS AWS Small business owner IT Infrastructure manager McKinsey & Company | 5
    6. 6. Explosive growth 25% Explosive 3-70x 25% Rapid 1-3x 23% Fast 0-1x 27% Contracting 0-0.5x1 > 100 VMs under management, *annualized growth based on 5 months dataSOURCE: Newvem analysis of AWS instances under monitoring McKinsey & Company | 6
    7. 7. Including enterprise Public IaaS adoption Deployed 5 at scale 10 Selective 37 deployment 43 None 58 47 2010 2012SOURCE: McKinsey Quarterly Survey on information and technology strategy, 2010, 2012; n=532 CIOs McKinsey & Company | 7
    8. 8. Not monolithic High Public : <10% Private: 70% ▪ Banking Remainder on ▪ Insurance traditional architecture ▪ Healthcare Degree of regulation ▪ Manufacturing ▪ Distribution ▪ Transportation ▪ High Tech Public : 20-25% Low Private: 60-75% Low High Remainder on Complexity and traditional architecture data interdependence across application domainsE: McKinsey Cloud Computing Survey, 2010, 2012 McKinsey & Company | 8
    9. 9. Security & regulatory barriers 2010 2012 1 1 Security 2 2 Regulatory exposure 3 3 Skills 4 4 Business case 5 5 Interoperability 6 6 Cloud awareness 7 7 Changing business processes 8 8 GovernanceOURCE: McKinsey Cloud Computing Survey, 2010, 2012 McKinsey & Company | 9
    10. 10. Security issues can be mitigated From To ▪ Rigid policy based ▪ Business-focused risk- security approach management approach that engages business leaders ▪ Focus on securing ▪ Focus on securing technology information and (networks, servers) processes ▪ One size fits all ▪ Workload specific policies (i.e., “we’re analysis to match risk going 100% cloud” with application and or “we forbid cloud” data criticality ▪ Specialized IT ▪ Integrated service managers talent aligned to aware of business technology “towers” implicationsE: McKinsey on Business Technology: Protecting information in the cloud McKinsey & Company | 10
    11. 11. Incumbents under pressureTraditional Product Model Traditional Product Model Cloud Purchase Model Cloud Purchase Model Revenue Revenue rvi on e ll ll se Ma oing Us oing ct s se llati s e . sa ce nt nt in t ag g g ta -fro -fro n On On Tra In s Up UpSource: McKinsey cloud initiative McKinsey & Company | 11
    12. 12. Huge value at stake Cloud / SaaS + Mobility + Big Data Client server + ERP PCs + Mini- Productivity SW computers + Transaction systems ‘70-’80 ‘80-’90 ’90-’00 Now Efficiency & Workgroup Standardization Innovation through record-keeping decision and efficiency insight and making rapid execution of ideas McKinsey & Company | 12

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