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Research reveals that most IT decision-makers only examine cost benefits to the IT department when considering cloud adoption and ignore the wider benefits to the business. While understandable, CIOs need to look beyond their own immediate priorities to cut costs and integrate their thinking with wider business cost-saving and efficiency objectives.
In late 2012, Claranet polled 250 senior IT decision-makers across a range of small and medium-sized businesses, enterprises and public sector organisations, to explore the rationale for adopting cloud services, and the ways in which ROI is calculated. It found that while 84 percent of respondents factored cost-savings to the IT department into their ROI calculations, only around half were calculating the wider benefits to the business, such as better business performance (55 percent) and improved employee productivity (49 percent), when examining the ROI for cloud adoption.
In light of these findings, Claranet’s UK Managing Director, Michel Robert, said that the cloud industry and IT decision-makers need to work more closely to fully realise the wider benefits of cloud services and boost the case for adoption: “The benefits of cloud computing are widely recognised, with some 62 percent of UK organisations now using cloud services and additional growth is expected this year. But, somewhat surprisingly, businesses still fail to factor in the broader benefits of this delivery model when calculating ROI, preferring instead to focus on cost-savings to the IT department. The benefits brought by cloud computing go beyond the IT department purse strings and it is essential that these are factored in from the start when deciding whether to move to a cloud-based solution.
“A focus on cost-savings alone limits the terms in which a cloud project can be deemed successful. When it comes to ROI, businesses and vendors alike must think more laterally about improvements to technical capabilities and the knock-on effect that it has on the business at large, such as improved flexibility and productivity,” Robert concluded.
