Despite heavy adoption, Cloud is still problematic

by CXOtoday News Desk    May 16, 2013

Cloud adoption

Cloud computing may not be the end all and be all for enterprises despite all that it promises to do for them. According to a study commissioned by Oracle spanning 17 countries and 1,335 respondents, findings show that while the adoption of cloud apps across the world is remarkably high and in all departments, integration problems are endemic.

In an ideal world, all companies would surely want top quality software to drive their business forward the reality is however, that 32 percent of these organisations agree that the cost of top-of-the range software and IT systems has prevented their company from buying best-in-class business applications. Almost 40 percent of MDs, CEOs and owners agree with this, as do 35 percent of finance professionals.

Cloud adoption levels

The research shows that, overall, 71 percent of these large organisations use cloud applications. However, levels of cloud adoption vary significantly across the countries, with the highest levels found in the APAC region (85 percent), and specifically China (92 percent) and Singapore (94 percent), UK (78 percent), France (79 percent), Germany (83 percent) and Italy (80 percent).

The research also shows that cloud applications are used by all departments across the organisation and 53 percent of finance departments use them, as do 57 percent of HR, 54 percent of those in sales, marketing and customer services/CRM roles and 75 percent of MDs, CEOs and owners.

Motivations

Among those whose departments use cloud apps, 76 percent say their motivation was to have a quick way to get the software they wanted: this includes 53 percent who saw it as a shortcut to getting what the department needed, 31 percent as a way of avoiding the queue for the IT department’s time and another 31 percent a way of jumping the queue of IT projects the IT department had lined up.

Also, 47 percent took on cloud apps to get access to what they believed to be more appropriate software for their department: including 35 percent who adopted it because they felt the existing software and systems in place were not entirely appropriate to their department’s needs and 22 who felt the IT department was not helping to move their area of business forward.

Problems with the cloud

Despite these high adoption levels, the research revealed problems existed with the approach to cloud computing these companies have taken. Problems have included staff downtime with 54 percent of people in companies using cloud apps say their department has experienced this in the last six months, where people have been unable to perform their jobs properly due to problems associated with cloud applications not being integrated properly across the company.

In addition to this staff downtime, 54 percent of companies say project deadlines have been missed in the last six months due to a lack of cloud data being shared effectively around the organisation. On average, this has happened nine times per company in the space of just six months. Around the world, LATAM and APAC lead in terms of missing project deadlines, especially in Singapore, India and Brazil.

Cloud falling short

The ability to innovate quickly is a well-publicised and strong selling point for cloud computing. However, 75 percent of companies that use cloud applications say their ability to innovate using their cloud apps has been hindered in some way. An inability to integrate has hindered innovation more in the APAC region (65 percent) and specifically in China (63 percent ), Singapore (70 percent) and India (78 percent ), and it has also affected more companies with international offices (60 percent).

Indeed, 1 in 2 companies has abandoned the use of at least 1 departmental cloud app in the last 3 years due to integration problems. Such cloud app abandonment has been especially commonplace in Singapore, India and Brazil.

Yet, 81 percent of all respondents think it is important that cloud applications are fully integrated with each other and with other software in the organisation. Companies in the LATAM region feel especially strongly about this issue, as do more people in the UAE, South Africa, Hungary, India and Brazil.

Among those who claim to have integrated cloud apps, integration seems to be only partial, covering some apps/ processes/ departments. About 68 percent of cloud adopters have attempted integration, but 55 percent of these have tried and failed. And 42 percent have seen a data security breach in their department associated directly with the use of cloud apps.