18. Climbing into the cloud
From cost efficiency to time saving, the advantages of cloud
computing are clear. But hurdles still exist and companies
need to take careful steps when implementing the cloud
The top three steps to
cloud implementation
Whenitcomestorollingoutthecloud,budget
allocationandtherightnetworkarekeyfactors
18%Obtainingmanagers’buy-in
foradoption
21%AllocatingadditionalITbudget
19%Determiningtypeofnetwork
(public/private/hybrid)
18
19. Cloud spending
Allocatingbudgettothecloudisnoeasytask,
andfirmsaretakingtheissueseriously
Outside assistance
Thevastmajorityofrespondentslookforassistance
withthecloudfromoutsidetheorganisation
73%offirmsplantospend
between11%and25%
ormore oftheir overallIT
spendingoncloud
62%ofrespondentslookto
consultantsforassistance
withbestpractice
Insights
1Themostimportantstepstocloud
implementationareallocatingITbudget,
determiningthetypeofnetwork,andobtaining
managementbuy-inforadoption.
2Only6%ofrespondentsareconcerned
withsecurityandprivacyinrelation
tocloud,potentiallyunderestimating
thischallenge.
3Determininghowmuchtospendonthe
cloudisataxingissue.However,many
surveyrespondentsnotethathigherspending
makessenseduetosubsequentefficiencies
andcostbenefits.
UK
France
Germany
4% 4%
10%
Percentage of respondents concerned about security
and privacy in relation to the cloud
Security
concerns
by country
Francehasthehighestlevel
ofconcernoversecurity
andprivacyinthecloud,
butallcountriesseemto
underestimatetherisks
Security concern
Arecompaniesseriously
underestimatingthesecurity
andprivacyriskfromthecloud?
Only6%ofrespondentsare
concernedaboutprivacy
andsecurityinrelation
tothecloud
19
20. Despitethecloud’sbenefitsandmany
respondents’assurancesthattheyhave
adoptedbestpractice,stumblingblocksto
implementationremain.Theserangefrom
budgetaryconstraintstoworriesabout
privacyandsecurity.Organisationsalsoneed
tobecarefulnottooverlookaspectsthat
mayinitiallyappearstraightforward.Internet
connectivity,forexample,isfundamental
toclouddelivery.Thespeed,reliabilityand
securityofnetworksarethereforeofcritical
importance.
Secure in the cloud?
Securityisamajorissuethatrespondentsmay
beunderestimating:just6%ofthosesurveyed
saytheyareconcernedaboutprivacyandsecurity
inrelationtothecloud.Giventhatoursurveypool
consistedofthoseinchargeofinformationand
technologyintheirbusinesses,responsebiasmay
Clearing the fog
What challenges does the cloud present and how are companies overcoming them?
21%
24%
20%
20%
20%
22%
18%
18%
18%
14%
14%
13%
13%
12%
12%
10%
10%
10%
1%
2%
0%
0%
6%
6%
6%
7%
19%
16%
16%
16%
8%
9%
Percentageofrespondents
Please rank the most important step in adopting
cloud for your firm
Germany FranceOverall UK
0% 5% 10% 15% 20% 25%
Trainingemployees
Defininggoalsaheadofimplementation
Findingtherightcloudvendor
Integratingpre-existingITsystemswithcloud
IdentifyingexternalITconsultants
Obtainingbusinessmanagers’buy-inforadoption
Determiningthetypeofnetwork(public/private/community/hybrid)
AllocatingadditionalITbudget
beatplay.However,thiscouldalsobeindicativeof
complacencyaroundsecurityissues.
Thereissomenationalvariationhere,with10%
ofFrenchrespondentsindicatingconcern,
versusonly4%ofbothGermanandUK-based
interviewees.Itmaybethatmanyrespondents
simplyhavenotthoughtenoughaboutsecurity
issues.Butseveralofthosewhoexpressed
concernstillhadgonetogreatlengthstoensure
theirsystemsweresecure.
“Weareconcernedbecauseoftheinvolvement
ofathirdparty,”saysoneUK-baseddirectorof
IT.“Butwiththestandardswefollowandthe
standardsourcloudserviceproviderfollows,
wearealsoconfidentofdatasecurity.”
Thoserespondentsconcernedaboutprivacy
andsecurityidentifyseveraldifferentwaysto
Using a cloud network means that a third party has access to
sensitive information. But considering the security measures
in place, we can be relaxed.”
Director of information technology, Germany
20
22. Good housekeeping
The workforce itself can create its own cloud-
related problems, often without realising. The
risk here comes from off-the-shelf applications
such as web-based email and file hosting
services. This ‘shadow IT’ estate presents risks
because it exists under the radar of external
corporate supervision.
Placing data and applications in the hands of a
third party presents a range of additional risks
that are sometimes overlooked and should be
planned for.
Legal and regulatory compliance is one of
them. Outsourcing the storage and processing
of information does not remove the obligation
on companies to safeguard personal data.
Equally, blaming a cloud service provider in
the event of a data breach is unlikely to limit
reputational damage.
In tandem with this, organisations need to
know where their cloud provider is storing
their data. Rules governing the movement of
data across borders vary significantly between
countries. Organisations can limit this risk by
choosing domestically based providers.
Security risks:
Are you concerned by the underestimation of security by
respondents? What has led to this attitude?
Alan Hartwell, Vice President Security and Identity Solutions, EMEA at Oracle
Thekeyelementholdingorganisationsbackfromsignificantcloud
adoptionisthelackofawarenessofcloudsecuritysolutions;someare
secureandsomearenot.Inthatrespect,it’sinterestingthatourstudy
showsthatoverhalfoftherespondentshavenotevenconsideredsecurity
inacloudcontext. Massuptakewillnotaccelerateuntilcloudsecurity
solutionsarebetterunderstood.
Security,privacy,andriskneednotbearoadblocktocloudadoption.
Withtherightconsiderations,executivescanmakeinformeddecisions
abouthowtoacceptandmanageriskappropriately.
Adoptingcloudcomputingisnotaboutdelegatingresponsibilitiesto
acloudprovider.Rather,itisaboutincorporatingtheseplatforms,and
theirpotentialbenefits,intoabroadstrategy.
OracleCEOLarryEllisonhassaidthatkeepingdataprivateis“nota
technologyissueatall.”Themainquestionexecutivesshouldaskwhen
contemplatingacloudsolutionisthatofmaturity.Cloudsolutionsshould
haveaclearlyarticulatedandwell-establishedsecurity,privacy,andrisk
managementprogramme.
22
23. What is your current anticipated spending on cloud as a proportion of overall IT spending?
0% 20% 40% 60% 80% 100%
Overall
UK
Germany
France
6%10%52%24%8%
2%28%56%14%
4%28%34%28%6%
4%22%47%22%5%
Percentageofrespondents
11-15%6-10%5% orless 20-25%16-20%
Taxobligationsalsorequirecarefulattention.
Forexample,shiftingfromacapitalexpenditure
costmodeltoanoperationalcostmodelcanhave
taxconsequencesforcompaniesusingacloud
serviceprovider.Theborderlessnatureofcloud
operationsaddsfurthercomplexity,withtax
obligationsandreportingrequirementsvarying
betweenmarkets.Taxationaroundcloudremains
inastateofflux.
Organisationsneedtobeclearaboutcloud
portabilityandlock-inclauses.Howeasyisitto
moveyourdataandapplicationstoanothercloud
providerifserviceispoorandthecosttoogreat?
Whatifyourcloudproviderfolds?
Whilemanycompanieswillwishtobuilda
relationshipwiththeircloudprovidersbased
ontrust–awordfrequentlyusedbysurvey
respondents–thevalueofbeingabletomigrate
easilyshouldneverbeunderestimated.
Budget constraints
Accordingtothelargestshareofrespondents
(21%),themostimportantstepinimplementing
cloudisallocatingadditionalITbudget.This
stepunderscoresthechallengeoffindingextra
financestogetcloudofftheground.
23
24. 69%
Is your firm concerned about interactions between
cloud-based systems and legacy systems?
84%No
16%Yes
Intermsofwhatrespondentsareallocating,the
highestpercentage(47%)currentlyspends
between11%and15%oftheirITbudgeton
cloud.Afurther22%spendbetween16%and
20%.Here,Germany-basedrespondentshave
mostclearlyprioritisedcloud,with86%spending
morethan10%oftheirannualITbudgetsoncloud.
Thiscomparesto68%ofFrenchrespondents
and66%ofintervieweesfromtheUK.
Determiningexactlyhowmuchcorporate
spendingshouldbedevotedtocloud–and,more
pertinently,whatcloudcapabilitiesitshouldfocus
on–isanissuewhichistaxingmanycompanies.
Acrossallthreecountries,manyofthose
surveyednotedthathigherspendingmadesense
duetoefficiencyandcostbenefits.Forinstance,
oneCTOfromtheUKsays:“Ianticipatespending
25%oftheITbudget,consideringhowcloud
canhelpustoprovidea24/7servicewithoutthe
physicalpresenceofanyemployee.”
However,thereisabigdifferencebetweenusing
cloudtoprovideanentirelynewservice,andusing
ittoreplaceanexistingone.Insomecases,firms
areusingcloudtorunapplicationsandservices
thatwereneverintheITdomaininthefirstplace.
Forthesefirms,cloudrepresentscompletely
newITspend.
Todate,theemphasishasbeenonusingcloud
forapplicationsthatsupportsales/CRM,
communicationsandcollaboration.However,
storageanddata-heavyapplicationsarenow
rapidlyemergingasattractivetargetsforcloud
initiatives.Bigdataisabigdriverforthis.
Cloudisincreasinglyseenasanatural
environmentforbigdataanalyticsbecause
We have seen a considerable change in IT efficiency since we
implemented cloud ... making the work environment more positive.
I feel we will grow our cloud network and around 20% of the budget
would be assigned to cloud.”
CTO, Germany
24
27. Cloud counsel
Identifyingcloudbestpracticeisnoeasytask.
Thesituationiscomplicatedbythespeedof
cloudserviceevolutionandbythecurrentlack
ofcommonstandardsforcloudmanagement.
Thisiscompoundedbythefactthatmanyof
theframeworksforauditingsecuritymeasures
arebasedonpoint-in-timeassessmentsand
thereforenotwellsuitedtocloudservicesthat
changecontinually.
What’s clear is that managing the complexity
and risk that goes with cloud is now beyond
the capabilities of most organisations to
handle alone.
A large proportion of survey participants
(more than 80%) refer to assistance from
outside their organisations. Sources of
external guidance include consultants,
conferences, cloud providers themselves
and technical reports. However, firms are not
spreading the net widely: only a handful of
respondents mentioned using more than one
external source.
Consultantsarebyfarthemostpopularsource
ofadvice.Sixty-twopercentofthebusinesses
thatseekexternalassistanceonbestpractice
usetheservicesofaconsultant,orwoulddo
soifrequired.Thefollowingresponsesums
upawidelyheldview:“Ourfirmdependson
consultantstodeterminebestpractices
forcloud,”saysanITdirectorinFrance,“as
consultantshavethebestknowledgeofthe
industryandcontinuouslyworktowards
cloudimprovement.”
Conferences are also used as a way of
keeping abreast of best practice. A number of
respondents attend conferences and industry
events in the search for insights. And insights
are not the only attraction: one CIO noted
that conferences are a good place to find
62%Percentageof
respondents
wholookto
consultantsfor
assistanceonbest
practice.
out what the experts are saying about cloud
providers “so that it becomes easier to switch
in future if necessary.”
Cloudprovidersthemselvesarealsoseenasa
reliablesourceofbestpracticeinformation:
asizeableminorityoffirmsseekexternal
adviceormakeuseofinsightsfromproviders.
Technicalreportsandnewsarealsousedto
gleaninformation,butonlyafewrespondents
saytheyusethem.
Whilerespondentsareclearlygoingto
significantlengthstogetthebestadviceand
stayinformed,thelackofstandardisedbest
practiceandguidanceisclearlyamatterof
concernandonewhichtheindustryisonly
juststartingtoaddress.
We have set up a firewall on all clouds so that no one gets unauthorised
access to information which is not to be shared openly.”
CIO, France
27
28. Cloud choice
Firms are implementing different cloud infrastructures across their
business in terms of software and the types of cloud they are using
Cloud formations
Companiesaretakingapluralapproachtothetypesofcloudstheyuse
97%usepubliccloud
61%useprivatecloud
Public cloud Private cloud Hybrid cloud
Resourcesareofferedbyaservice
providerovertheinternet
Easytosetup,competitivelypriced
Notasbespokeasprivateor
hybridcloud
Resourcesarededicatedtoa
singlecustomer
Easiertomaintainoversightand
retaincontrolofsecurity
Highercoststhanpublicor
hybridcloud
Bringstogetherbothpublicand
internally-providedcloudservices
Bestofbothworlds
Morecostlythanpubliccloud
57%usehybridcloud
28
30. A unique cloud model for every business
What considerations need to be made when tailoring your business-specific cloud solution?
Firmsarecreatingcloudsystemsthatareas
individualastheirownbusinesses.Thistheme
emergesthroughoutthestudy.Morethanthree-
quartersofrespondents(77%)saythattheir
firmshaveimplementedcloudinfrastructure
differentlyacrossdifferentdepartments.As
aFrance-basedtechnologydirectorsays,this
is“becausedifferentteamsperformdifferent
dutiesonadailybasis.Theseteamsneedtohave
accesstoindividualinformationandtheirwork
isoftennotconnectedtothatofotherteams.”
Implementationvariessignificantlyacross
allthreenationssurveyed.At96%,nearlyall
Germany-basedrespondentssaythattheir
firmsimplementclouddifferentlyacross
differentdepartments.Thiscompareswith
68%ofthoseinterviewedfromboththeUK
andFrance.Again,thisislikelytobetiedtocloud
adoption,withmostGermanrespondents
havingalreadyimplementedcloud.Maturityin
allmarketsislikelytobemarkedbyincreasingly
pluralapproaches.
Software on demand
SaaSisoneofthecornerstonesofcloudand
morethanthree-quarters(76%)ofsurvey
respondentssaytheyuseit.
UK
France
Germany
Has your firm implemented cloud infrastructure differently across different departments?
Yes
Yes
Yes68%
68%
96%
OVERALL
ofrespondentsimplementcloudinfrastructure
differentlyacrossdifferentdepartments
77%
Our firm’s business demands service at all times and SaaS has made
it possible for us. SaaS helps in monitoring activity and engagement
and provides results based on the user experience which helped us
to improve in many aspects we had not thought of.”
CIO, Germany
30
31. Does your firm use SaaS?
76%Yes
24%No
[IF YES]: In which department have you implemented
SaaS specifically? (Please select the most important)
Germany FranceOverall UK
44%
18%
14%
14%
13%
13%
7%
21%
16%
11%
11%
11%
15%
6%
6%
6%
6%
6%
4%
4%
4%
3%
3%
10%
0%
47%
36%
52%
Percentageofrespondents
0% 10% 20% 30% 40% 50% 60%
Productdevelopment
Humanresources
Finance/accounting
Research
Operations/logistics
Marketing
Sales/CRM
SaaSisabouthiringsoftwareratherthanjust
buyingit.Typically,softwareandapplications
areaccessedusingawebbrowserormobile
appandhostedremotelybytheservice
provider.CommonapplicationsincludeCRM
andenterpriseresourceplanningapplications,
althoughjustaboutanyapplicationcanbe
deliveredonan‘as-a-service’basis.
TheSaaSmodelofferssignificantbenefits,asit
eliminatesthecostsassociatedwithpurchasing
andinstallingsoftware.Italsoreducesthehassle
anddisruptionofsoftwareupgradesandpatch
management–thevendortakescareofthis.
Inaddition,SaaSmeansorganisationscanbe
confidentthateveryoneisworkingfromthe
sameversionofthesoftware.
SaaScanalsoenhanceflexibility.Userscanbe
addedandremovedeasily,withfirmsonlypaying
forwhattheyuse:pay-per-usemeansthat
organisationsarenotburdenedwiththehigh
costsofowningseldom-usedsoftware.Italso
meansfirmscanexperimentwithapplications
theywouldnototherwisebeabletoafford.
Equallyimportantly,theSaaSmodelallows
userstoworkfromanywhereusingmobile
31
35. What percentage of your cloud capabilities are hybrid?
0% 20% 40% 60% 80% 100%
Overall
UK
Germany
France
40-59%
20-39% 100%
1-19%
0%
80-99%
60-79%
14%
4%4%6%
1%
14%
11%16%43% 25%4%
20%20%46%
36%6%44%
22%40% 4% 20%
Percentageofrespondents
Ahybridapproachallowsorganisationsto
getthemostoutofbothinternalandexternal
resources.Hybridcloudisusedby57%of
respondents,lessthanbothprivateand
publicclouds.
Pick and choose
Thecloudmodelthatorganisationschoosewill
dependonusagerequirements. Forcustomer-
facingapplications,publiccloudisaclear
favourite.Theabilitytotrackwhatcustomers
aredoing,andtogetclosertothem,faster,isa
keyfactor.
“Weneedpubliccloudstocheckonour
customermovementsandtofocusontheir
needs,”saysaUK-basedtechnologydirector.
Easeofinteractionisalsoadriver.“Regular
pollsandinteractionsarethefoundationofour
businessanditssuccess,”emphasisesanother
ITleader.“Weneedtobeactiveonthepublic
cloudtofavourourcustomers’demands.”
Respondentshadsimilarlyclear-cutviewsabout
howandwheretheymakeuseofprivateclouds.
Notsurprisingly,theenhancedsecurityoffered
byprivatecloudsishighlyvalued.“Ourprivate
networkisessentialtokeepthedataheldbythe
97%Percentageofrespondentswhousepublic
cloudinsomecapacity–byfarthemostused
ofthecloudcomputingserviceoptions.
35
36. Cloud Options:
What considerations need to be made when advising a
company in cloud adoption and modification?
By Paul McCartan, Vice President Sales Development at Oracle
Western Europe
Despitethesurprisinglackofconcernshownbyrespondentsinthe
survey(only6%saidsecuritywasamajorchallenge),securityisstillone
ofthemajortalkingpointsforcompaniesadoptingthecloud.While
thesurveyappearstorevealaworryingcomplacency,businesses
stillwanttobeassuredthattheirvaluableinformationwillbesafein
thecloud–particularlywithnewEUlegislationgearedatprotecting
personaldatacomingintoeffectin2015.
Yet,withthetopcloudprovidersintheworldinvestingmillions
inthelatestsecurityinnovations,companiesneedtolookmore
closelyatthedataintheirowndatacentres,whereagreatdeal
ofbreachesactuallyhappen.Companiescanmakesignificant
improvementstotheirITsecuritybytakingmeasurestoprotect
theirowndatacentredefences.
finance and HR teams secure,” notes one
CIO. “We are using the private network only
towards securing confidential information
in regards to financial turnover and business
partners,” says another. Respondents also
report using private clouds to reduce the risk
of unauthorised access to sensitive research
and strategic planning data.
Additional benefits
Whilesecurityisthemaindriver,respondents
identifiedanumberofadditionalproperties
thatmakeprivatecloudagoodbusinesschoice
forthem–andsometimestheonlychoice.
“Incertaincountries,thedatacentrehostinga
publiccloudservicemustresidewithinthelocal
countrywhereitsusersresideaswell,”explainsa
GermanITdirector.“Sowhenthereisnopublic
cloudoptionthatcanbeprovidedfromthelocal
country,aprivatecloudistheonlyoptionthat
canbeused.”
Aswellashelpingbusinessestoremain
compliant,privatecloudsolutionsare
attractivebecausetheycanbetailoredtoan
extentthatisnotalwayspossiblewithpublic
cloudservices.
“Privatecloudplatformsgrowwithour
business,andtheseplatformstendtobemore
customisablethanmanypubliccloudofferings,”
notestheCTOofaFrenchfirm.Resilience,control
andservicecontinuityarealsokeyfactors:“We
candesignourownenvironmentswithallofthe
redundancywerequire,”observesaUKITdirector.
ThispointisreiteratedbyaGermanCTO:“With
thelevelsofredundancybuiltintoanenterprise
privatecloudservice,thereisaminutechanceof
anoutageeveroccurring.”
Asnotedearlier,thecostsassociatedwith
privatecloudaregenerallyhigherthanthose
forpublicofferings–apointidentifiedbya
numberofrespondents.However,thehigher
costsmaybejustifiedonthegroundsthat
theprivatecloudmodelimprovesresource
allocationandhelpsorganisationstoalign
supplywithdemandmoreeffectively.
“Althoughprivatecloudsarenotascost
effectiveasapubliccloud serviceduetosmaller
economiesofscaleandincreasedmanagement
costs,theydomakemoreefficientuseofthe
computingresourcethantraditionalnetworksas
theyminimisetheinvestmentinunusedcapacity,”
notesoneITdirector.
36
37. Somewarningbellsweresounded,however.
Organisationsneedtoretain–andenhance–
securityandmaintenanceoperationsiftheyare
togetthemostoutofprivateclouds.Storage
issuesalsohavetobetakenintoaccount.“You
havemorecontroloverthedata,”notesoneCIO.
“Buttherearedatalimitationsandyoucouldrun
outofspaceiftherearehugefilesbeingsavedon
adailybasis.”
Low use, high benefits
Hybridcloudsareseenbyrespondentsas
representingthebestofbothworlds,although
likeprivatecloud,theytendtobeusedlesswidely.
“Thehybridnetworkisreliableasithasfewer
risksandismoresecureandcosteffective,”says
aGermanCIO. “Basedonthesuggestionsgiven
byourcloudprovider,wedecidedtomovemost
businessfunctionstothehybridnetworkand
keepothercloudusageminimised.”
Thelowercostofhybridsolutionswasalsoseen
asanattractionbysurveyrespondents.“Asthe
hybridnetworkischeaperthantheprivatecloud
andhassimilaradvantages,wehavereduced our
usageofprivatecloudandhavestartedusingthe
hybridnetworkmore,”saystheheadofITata
Germancompany.
Customerrelations,sales,marketing,product
developmentandresearchareamongthe
departmentswhoseneedsarebeingmet
throughthehybridcloud.“Thecustomerand
salesteamcanbeputonahybridpubliccloud
networksothattheycanmaintaincontinuityin
customerissues,problemsolvingalongwiththe
customersandtheinternalteam,”notesaUK-
basedITdirector.
Thevariedresponsesgatheredfrom
participantsindicatethatorganisationsare
alreadytakingsophisticatedandhighlytailored
approachestocloudadoption,withdifferent
cloudsalignedtodifferentbusinessand
securityneeds.Perhapsmoreimportantly,a
numberofrespondentsindicatedthatthey
hadmovedfunctionalitybetweenclouds.
Portabilitybetweencloudsislikelytobecome
increasinglyimportantasfirmsseektobuild
acompetitiveadvantagebyshoppingaround
andofferingnewservices.
We implemented different cloud networks where some
of them are committed to certain functions and some
of them are either private or public. For example,
we moved our financial planning information and
investment details to a secure private cloud as our
firm is looking at long-term expansion and would be
investing in the global market, so we would not want
that information to be leaked or missed.”
Senior vice president of technology, Germany
37
