Retail CIOs in APAC Slow on Cloud

by CXOtoday Staff    May 21, 2012

cxThe retail industry in the Asia Pacific region is taking a cautious approach to cloud computing, revealed a new survey by IDC Retail Insights. According to the results of the survey, only 19 percent CIOs/IT managers in the region’s retail sector are evaluating the adoption of some form of cloud computing services.

However, the IDC survey noted that even though the current number is significantly low, cloud is gradually gaining momentum among Asia Pacific retailers because 32 percent of the respondents said that they are planning to adopt cloud technologies in the next two to five years. The report also stated that cloud deployment is on the priority list of retail CIOs/IT managers in Asia Pacific.

Kumar Gs Das, Research Manager, IDC Retail Insights-Asia Pacific pointed out that most of the retailers in Asia Pacific recognises that cloud would bring efficiency to their IT systems and improve operational backend issues. “However, the plan to move into virtual platforms does not appear to be immediate and would take off between two and five years,” he said.

The research unveiled that the retail industry in Asia Pacific region mostly relies on the legacy systems and are hesitant when it comes to new technology adoption. Moreover, as the industry is still emerging, the adoption of retail-specific technology in this region is far lesser when compared to other parts of the world. However, IDC Retail Insights believes that there is a huge potential of cloud adoption among retailers in this region.

According to Das, the growth of retail industry in the Asia Pacific region has slowed down as China is experiencing a slowdown in its services and manufacturing sectors, along with the Indian economy that is weakening due to rising inflation and falling rupee. However, when compared to the developed markets in the US and Europe, the economic outlook in Asia is still much better. “Evidently investors will continue to shift their focus to Asia and businesses will be looking to improve operational efficiency and IT productivity in order to keep up with growing consumer demand,” said Das.

The IDC Retail Insights further noted that data security, firewall concerns and IT integration are the three main barriers to cloud adoption as stated by retail CIOs/IT managers in Asia Pacific. The study recommended that for cloud to gain traction in the region and to improve connectivity there must be a greater investment in the backend infrastructure.