Labour shortages, hybrid work complexities, and economic uncertainties are not deterring IT leaders’ spending in 2023; 56 percent of those surveyed will not expect any IT budget cuts this year. Yet at the same time, they are facing increasing pressure to prove that the returns justify, or even outweigh, the investment.
One such investment that is hanging over many IT leaders’ heads is the cloud. Most enterprises already have some form of cloud presence, with leaders broadly recognising that cloud adoption is critical to thriving in today’s digital era.
“There is a rise in cloud commitments over the past few years, with 86 percent of companies increasing the scope and volume of their cloud initiatives since 2020,” says Paulo Ossamu, Cloud First Lead at Accenture in APAC, Africa, Middle East, and LATAM. “That said, only 42 percent reported being able to fully achieve their expected outcomes. This gulf between expectation and reality points to the age-old barriers of security risks, complexity, and legacy systems, which continue to complicate cloud adoption.”
The unfulfilled promises of the cloud
Among the most elusive of cloud outcomes is cost savings, a mounting source of frustration for many APAC IT leaders. That’s because cost reduction is among the top objectives of many digital business strategies in the region, which is only second to driving workplace productivity. Even as IT leaders place their bets on cloud-native platforms and ramp up their cloud efforts, many are struggling to reap the full benefits of the technology.
In addition, the complexity of such a shift lies in the data itself, with the enterprise data landscape expanding at an unprecedented scale and speed. Data is becoming more complex with a variety of data types, such as unstructured data in virtual environments, sensor data from Internet of Things (IoT) devices, and even metadata created to catalog and manage other enterprise data. As a result, 57 percent of IT resources are being spent on maintaining existing systems and processes, instead of innovations that can drive business reinvention.
Reinventing the digital core: a holistic approach
To move the needle on cloud success, Ossamu suggests that leaders embrace a holistic approach to prioritising and overcoming roadblocks to the cloud.
“When it comes to migration, it’s important that businesses adopt the capacity to replatform at scale while embracing cloud as a new operating model. This involves reinventing the digital core of your business, as it shifts from a technology landscape made up of static, standalone parts, towards one with integrated, interoperable pieces that leverage the cloud.”Paulo Ossamu, Cloud First Lead at Accenture in APAC, Africa, Middle East, and LATAM
Driving the strategic needs of today’s enterprise is a strong digital core comprising three layers: infrastructure and security, data and artificial AI, and applications and platforms. Critical to the digital core is the cloud. So how can businesses strengthen their cloud trajectory and reinvent their digital core? Here are a few considerations IT leaders should keep in mind:
- Break down silos for data excellence: This lets businesses leverage AI to the fullest extent, so leaders can extract the right insights necessary for sharpening the competitive edge.
- Shift the conversation from cloud cost to value: Instead of centring the migration process, such conversations will help businesses gain the transparency and oversight to master and optimise cloud spend.
- Identify use cases according to time-to-value: Businesses can align their investments with emerging strategies.
- Adopt the right mix of capabilities and services: This allows businesses to successfully embrace the cloud as an operating model and a strategic enabler.
- Transform people and processes in tandem: Organisations can adopt transformation initiatives from ways of working to organisational cultures, so as to deliver faster outcomes.
Cracking the value code
Building upon this foundation of cloud and data are emerging technologies, which will be leveraged by leaders to satiate their appetite for innovation. AI, in particular, has generated significant traction as many leaders believe that AI and machine learning (ML) will fundamentally alter the way businesses will operate in the near future.
Coupled with a modern data architecture, AI can help businesses manage their operations cost-effectively. Already, nearly a third (31 percent) of APAC IT leaders have AI and ML on their radar, with 16 percent already piloting the technology, and 19 percent in the midst of production. In another survey, 43 percent of respondents indicated that they would allocate additional funds to enhance data analytics and AI.
And it is businesses with a modern, cloud-based IT foundation to keep data accessible while unlocking trapped data that can leverage AI to its fullest extent. In the case of insurance companies, laying a robust data foundation allows data collection at every customer touchpoint. This enables a better understanding of the customer’s needs, which can drive personalisation and help determine the right products for them.
“The role of the cloud has changed since it took the world by storm years ago,” says Ossamu. “Rather than just serving as a more scalable and affordable alternative to traditional, on-premise IT infrastructures, it is integral in playing a much bigger role today: to unlock the trapped value of data. This, in turn, offers companies the cross-functional intelligence they need to reinvent their business and achieve breakthrough innovation.”