The De Facto Cloud Should Be Transformative

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There are all these reports coming out that cloud is now the “de facto” choice for technology – that basically it has trumped legacy systems so substantially that it’s now the top tech priority for businesses. But if cloud is now standard, it must also be transformative in order to incorporate finance chiefs.

  • Cloud at Top of Business
  • Now Considered the “De Facto” or Default Choice
  • Leveraging the Potential for Transformation
  • Why Settle for Mediocrity?

Cloud at Top of Business

It’s obvious to most businesspeople that technology is now central to business success. The ever-changing landscape of technology can only be ignored at one’s peril. What’s the evidence? In fact, a report released in June found that almost three out of four chief executives around the world believe that technology is disrupting their industry – in other words, they say it is the one element that most greatly influences the market.

Technology is important, but what’s the most key technology for development, differentiation, and competitive advantage? Here are the top responses:

  1. Cloud computing – 63%
  2. Mobile tech – 61%
  3. Internet of things – 57%
  4. Cognitive computing – 37%
  5. Groundbreaking manufacturing tech – 28%

[RELATED: Do you want cloud that’s never oversold? That’s us.]

Now Considered the “De Facto” or Default Choice

Cloud technology is gradually becoming the default method with which business computing is put into operation, according to another recent study. The era of doubt about cloud seems to be over, with very few large companies deciding not to shift funds toward the virtual technology.

“As the majority have run mission critical applications over the cloud, and there is near universal recognition of better performance, usability and lower cost of ownership,” explains Business Cloud News, “the fear of adopting cloud and [abandoning] old expensive computing models has disappeared.”

Let’s take a look the statistics from the 2015 study. Compared to similar studies conducted in previous years, more large companies (69%) say that they redesigned at least one business task to take advantage of the cloud. In fact, that statistic is almost twice as high as it was in 2014. What’s more, an incredible seven out of eight respondents (88% percent) say that cloud is better than legacy systems and improves engagement. Meanwhile, almost two-thirds (65%) believe it has had a positive impact on general operations.

The data, frankly, is kind of astounding. “80% [of businesses] say they feel as secure or more secure than they do with an internally run IT service,” says Business Cloud News. “As a result, 87% of businesses are now using the cloud for mission-critical workloads.”

Just look at these figures for mission-critical application penetration by cloud (the last figure a projection):

  • 2013 – 60%
  • 2014 – 71%
  • 2015 – 87%
  • 2016 – 98%

Enterprise IT should be pleased to know that not all systems are being moved to external locations, with nearly half of companies (44%) saying they were either currently using or developing private clouds.

Leveraging the Potential for Transformation

Okay, so the world is changing under our feet, with industries worldwide being disrupted by cloud technology. Cloud actually isn’t just the new technological model but an opportunity for organizational transformation. That was the topic at the Cloud Business Summit, a forum presented in New York.

In a roundtable talk at the forum, tech and financial executives talked about the integration of cloud with finance. The business leaders agreed that finance chiefs often disagree with other executives in their continuing skepticism toward cloud.

Cloud is now a fundamental piece of the enterprise, notes IT consultant Bruce Guptill of Connecticut-based Saugatuck Technology. “There are thousands and thousands of case studies and examples how we can improve our value to our organizations,” he says.  “It’s not replacing us, it’s a new set of tools and a new set of lenses creating more opportunity.”

Basically, the heads of the IT and finance departments are moving at different paces because caution is considered the #1 rule of finance by many.

Companies often get uneasy when they consider a financial move to the cloud because making changes to finance often impacts the entire organization, notes CIO Bill Sinnett of Financial Executives International. “How do you go into a halfway measure around your core accounting and shift it to the cloud?” he asks. “There isn’t a transition path.”

That helps to explain the concern of finance chiefs: cloud feels “all-or-nothing” to them. You can’t just force people in the finance world to love cloud. You have to show them how cloud will improve financial data analysis.

It’s critical to understand that finance chiefs are focused on reporting, and discussion of cloud is better focused on solving big-picture problems. When financial systems malfunction, finance chiefs tend to think it’s an issue with business intelligence, specifically reporting, Sinnett advises. “But the reporting tool is not the problem — it’s a data problem,” he says. “[T]hey haven’t captured the right kind of data. It’s a whole financial architecture problem.”

Why Settle for Mediocrity?

Business is moving quickly to cloud, and it seems that many finance leaders will start to better appreciate its appeal when they see how they can better analyze data.

The key is to make sure that the cloud systems your company uses are great cloud rather than mediocre cloud. At Superb Internet, we use distributed storage rather than centralized (the latter a mainframe-era remnant still used by most cloud providers) and InfiniBand rather than 10 Gigabit Ethernet (for zero packet loss and almost no jitter).

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