Survey Says! Consider The Cloud

The Oracle Applications User Group (OAUG) recently published a very insightful survey describing Cloud usage by Oracle customers.

The survey included over 360 responses from business and applications managers worldwide.  Survey respondents were segmented into those using one or more Cloud application for less than one year, for one to five years, and for more than five years.

I extracted five insights from the survey data about Cloud dynamics—how Cloud use changes over time.  Together these insights present a compelling case for committing to private and/or public Cloud applications and platforms now.

1.  No surprise, but cost savings remains important throughout the Cloud experience.

In my travels I meet two Cloud camps: those who focus largely on the cost benefits of Cloud, and those who put cost benefits second to other benefits like process standardization and simplification.

Survey respondents indicated cost benefits are consistently important over the Cloud Lifecycle.

• Cost reduction is clearly important when respondents were first considering a move to the Cloud

• Lower Cost of Ownership was equally important when they were evaluating Cloud proposals (though Vendor Reliability is the most important factor).

• And realized cost savings was the number one benefit received from current Cloud investments.

2.  Cloud users double the data they move to the Cloud over five years.

About one-quarter of survey respondents entrust Customer, Financial, and Employee data to the Cloud in their first year.  This commitment roughly doubles within five years.

One small surprise was the observation that survey respondents are least likely to commit Employee Data to the Cloud over the five year horizon.  This is a bit puzzling given the maturity and market acceptance of SaaS HR solutions.

3.     Benefits grow as experience with the Cloud grows.

Each set of columns show the percent of survey respondents who achieved the following benefits after five years of Cloud use.   

Over 40% of respondents reduced costs through standardization and consolidation after five years.   

More dramatic are the observed increases in Process Flexibility (first set of columns) and Security/Privacy (second set of columns).  For example only 3% of survey respondents indicated they had increased Business Process Flexibility in their first year, yet fully one-third of Cloud users had realized this important benefit within five years.

4.  Problems with Clouds look suspiciously like the problems people report with traditional on-premise software.

After five years of deployment almost 30% of Cloud users cite challenges with Cloud Integration, Vendor Lock-In, and Interoperability.  These issues mirror the issues we’ve heard from our clients who have adopted on-premise ERP systems over the past fifteen years.

5.  Two important Cloud challenges decrease over time, highlighting the business benefits gained from Cloud deployments.

Over 30% of survey respondents reported problems implementing New Processes/Policies/Roles and gaining Cross-Organizational Support in their first year of Cloud deployment.  After five years these challenges halve or more, with the challenge of gaining Cross-Organizational support decreasing to a trivial level.

Reported increases in support for Cross-Organizational Performance and new Processes/Roles suggest Cloud systems effectively change “how we operate, who we are” over time.  This ability to foster standardization is an important benefit—I know at least one global company who replaced their ERP system with a Cloud solution specifically to enhance global process consistency. 

For more about the benefits public and private Clouds offer, and how these benefits will lead SOON to rapid expansion of the entire Cloud world, I encourage you to read my February post “Cloud Will Be REALLY Big: Three Reasons Why” at http://tinyurl.com/6md5j5x. 

As always I'd love to learn what you think and what you're doing with Cloud applications and platforms.