Taking the pulse of markets and their participants
By Mark P. Dangelo
As the end of this decade draws to a close, there has been great talk in the media about the sesquicentennial publishing anniversary of Darwin’s Origin of Species. Some refer to the “animal spirits” that are contained in the dealers of Wall Street, the industry moguls, and the activists, who are trying to tame an uncooperative world. However, just like Darwin projections and the science around evolution, a new “technical animal” called cloud computing is changing its genetic structure every day.
One thing this is very different moving forward with the birth of cloud solutions, is that CIO’s and CTO’s will be measured by business metrics – rather than overhead metrics of cost management and infrastructure spending.
Additionally, there are two key trends that are rapidly expanding regarding the usage of cloud computing resources and on-going viability – services and “all-in-one” offerings.
From the survey feedback, the use of services appears to be a key component and concern for many businesses and IT professionals. Who to trust? Are they knowledgeable? What cost and on-going commitment is required?
Regarding the “all-in-one” offerings, companies are impressed with the idea of a “one-stop-shop,” but are reluctant to embrace an all-or-nothing solution that appears on the surface to be expensive with considerable lock-in periods. However, with an increasing number of vendors all providing hardware, software and services in an end-to-end bundle, the challenge for purchasers will be evaluating each on their merits efficiently aligned with corporate needs. Specifically, only purchase what is needed and not pay for unused or unnecessary options.
The survey was constructed to focus on seven distinct areas of interest:
· Enterprise and Department Usage
· Belief in Existing Analytics
· Importance of Existing Data Sources
· Importance of Existing Analytics
· Cloud Computing Challenges
· Cloud Computing Acceptance
· Cloud Computing Preparedness
Enterprise and Department Usage
Survey results can often confirm what you have expected or in some occasions, produce insights that shed light on emerging trends or organizational beliefs. This on-going survey was no exception.
When asked if quantitative measurements were important to the enterprise, nearly 60%[1] of the respondents said they were high to critical, yet not quite 50% said they were effective.
Conversely, only 21% of the respondents when asked the same questions about their departments or divisions, said that quantitative measurements were effective, but more than twice as many said that these same ineffective measurements were high to critically important (44%).
The implications of these results suggest that internal process measurements were not meeting the needs of the local departments / divisions, even though the demand for measurements was moderately high. Moreover, these same individuals surveyed believed that the enterprise had more effective analytics and that they were almost 150% more effective than their own.
Belief in Existing Analytics
While the respondents firmly indicated that the organization as a whole was better off than their departments or divisions, their belief in the value of their analytical approaches was strong (see Figure 1).
A deficiency identified with the existing analytics was their ability to provide predictive intelligence – only 14% thought that what they were doing was of high or critical importance.
The only other challenge potential was the use of analytics to support the delivery of strategic goals or the achievement of operational strategies – 30% identified these as low or NS (not significant).
Importance of Existing Data Sources
The importance of existing data within the organization for the most part was what analytical specialists would expect. First, the use of spreadsheets remained a valuable source of analytical intelligence (see Figure 2). Moreover, point based application systems continued to be the master source for many data analysis and synthesis operations to support extraction of information into the spreadsheets.
This series of questions clearly points to potential conflicts with the use of information and the subsequent manipulation of information by desktop toolsets (and the security, logic, and integrity within them).
The surprise factor was the 86% moderate to critical importance placed on non-internal or third party data sources for analytical decision. Clearly, information integration, archiving, and transformation have become a primary need within business and IT departments.
Importance of Existing Analytics
Whereas, current analytics and data sources were given high marks, their importance for various decision making or operational performance were varied (see Figure 3).
For example, 77% of respondents clearly indicated that analytics for on-going improvements or quality of delivery were of moderate to critical importance. Yet, only 71% said that the existing data and sources were important for risk analysis and/or mitigation.
Puzzling was that only 37% who identified analytics as important for revenue or profit improvements given that margins are always measured. This suggests a disjointed view and potential misuse of analytics across the enterprise. Meaning, while the departments and divisions focus on exposure and improvements, they failed to see the potential direct correlation to organizational profits. Striking still was the lack of moderate importance (just 6%) assigned to analytics for regulatory compliance. The results were very strong (68%) that identified analytics as important for regulatory compliance but a high percentage (25%) indicated that analytics were low or non-significant for meeting regulatory demands.
Cloud Computing Challenges
While the source and uses of existing analytics yielded a few surprises from the expectations, the introduction of cloud computing and the data sources it generates created some clear challenges (see Figure 4).
The biggest surprise was the indication by both business and IT professionals that the introduction of cloud computing materially changes the future role of IT – nearly 78%.
Equally insightful was the 80% of respondents that said the usage of cloud computing increased the risks of meeting regulator needs and agency guidance.
As expected, respondents expected data integration challenges with cloud computing – 29% indicating high to critical issues.
What was expected, but also telling, was the 42% who said they expected high to critical security issues. However, equally telling was the 29% who said security challenges within cloud computing were low or non-significant.
Cloud Computing Acceptance
While the respondents were concerned with the use of cloud computing and meeting regulatory compliance, 50% also felt that it was high to critical in meeting oversight and governance needs (see Figure 5).
Moreover, 72% believe that cloud computing would be of moderate to critical significance to meet changing consumer and business functionality in the timeframes demanded by the markets. The respondents also stated that ROI of cloud computing was a major factor in its adoption, but 56% indicated that cloud computing was non-significant or of moderate importance for consumers or customers.
Cloud Computing Preparedness
Finally, the most foreboding measurements regarding cloud computing arrived in the area of organizational preparedness (see Figure 6).
In every category the ability to perform and deliver on the promises and requirements of cloud computing garnered very substantial non-significant or low ratings. Many times, this single category gained 50% of the responses.
Regarding the ability to address security challenges, only 17% said that their organization rated high to critical capabilities.
The skills demanded for data integration across the layer of cloud applications received only 24% in the high to critical range. This alone signified a clear challenge and opportunity surrounding skills, standardization, outsourcing, and correlation of growing data sources provisioned outside the traditional intranets.
Yet, while there were concerns surrounding data integration abilities, the use and deployment of analytics using cloud computing data sources increased by 3% to 27%. This margin is not significant but it may point to a greater belief that once the data is properly integrated, the ability to summarize, augment, and transform raw fields will be easier for analytical personnel.
Finally, when asked a non-specific question on the general cloud computing skill sets internally available, 28% of the respondents believed that their organizations had the necessary high or critical abilities to effectively implement cloud computing – its data, analytics, and security.
Taken separately, each cloud computing skill category performed poorer than the aggregation.
In Summary
The snapshot of this survey clearly points to a belief that internal analytics apart from cloud computing are established and reasonably trusted. However, there were clear areas of opportunity regarding their usage and robustness.
Additionally, when cloud computing principles and challenges were introduced, there was a material reduction in the comfort level associated with this rapidly evolving set of integrated technologies. The most important clearly pointed to data integration and security protection.
[1] Note, for simplicity of presenting the survey findings in this forum, all numbers were rounded to the nearest integer.