Wednesday, 27th January 2021

Companies struggle with cloud value

One in four organisations are hindered by unexpected complications with cloud migrations.

Despite years of focused effort, many enterprises are still struggling to realise the full value of their cloud investments, a new report from Accenture reveals.

Accenture’s latest study, “Sky High Hopes: Navigating the Barriers to Maximize Cloud Value,” surveyed 750 senior business and IT professionals at large enterprises across 11 industries and 17 countries. It found that just 37% of companies say they are achieving the full value expected on their cloud investments – a mere 2% increase since Accenture’s original study in 2018.

While value realisation has never been more important, only 42% of business and IT leaders in Europe say they are “very satisfied” with their cloud outcomes. Moreover, just 28% are completely confident that their organisation’s cloud migration initiatives will deliver the expected value at the expected time.

Accenture’s report highlights that, when businesses have gone more heavily into the cloud, outcomes are significantly better. Forty-six percent of high adopters report fully achieving their expected cloud benefits, compared to 36% of moderate adopters and 28% of low adopters.

Businesses recognise they need cloud technologies to help mitigate the major challenges they are facing. According to the report, 75% of European business executives now look to cloud as a means of mitigating business uncertainty and lowering risk. In addition, 81% view cloud as a critical component of their strategy for achieving their corporate sustainability goals.

“Leaders have known for a long time now that cloud is the way forward, but many have been slow to act or fully commit to their cloud strategy. This year has been a real wake-up call for many of these organisations, who are accelerating potentially years of planning into just months or even weeks with the shift to remote working,” said Emma Roscow, Intelligent Cloud Infrastructure lead for Accenture UKI. “These findings are a reminder that embarking on the journey is just the first step. Although much of this transformation is out of necessity, those that approach it with a survival mentality won’t achieve long-term results. Leaders must remember to keep their business objective in mind and treat workforce change management as an equal priority alongside technology investment.”

The research also examines what may be holding businesses back when it comes to driving their cloud agendas and achieving their goals. “Lack of skills” was most frequently included in CEOs’ top three perceived barriers (54%). “Security and compliance risk” was predominant among all respondents (42%), followed by “legacy infrastructure & application sprawl” and “misalignment between IT and the business” (both at 40%).

The findings also show that CEOs have markedly different impressions of cloud results and concerns than fellow C-suite leaders and high-ranking company officials: 54% of CEOs are completely confident in their organisations’ ability to deliver cloud initiatives with the expected value at the expected time vs. 34% of CIOs and only 28% of CFOs.

To extract the full business value of cloud technologies, Accenture recommends that organisations adopt fundamentally new ways of working, shifting to new operating models and developing new roles and skills. Four key areas for companies to address include:

  1. Business value focus: develop an optimal cloud strategy anchored to comprehensive economic business cases to identify revenue upside and cost efficiency opportunities while aligning goals and putting company leaders on the same page.
  1. Workforce and culture change management: implement talent readiness programs and new operating models to evolve culture, transforming how people work and what work they do to help meet rapidly changing needs.
  1. Data and AI: unlock industry- and function-specific data insights and intelligence trapped in legacy systems with the power of cloud data models.
  1. Partnering for success: leverage the skills and experience of the appropriate partners to augment your own capabilities. Cloud managed services is often an option for companies looking to access the right skills while maintaining cost efficiency.
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