Study: enterprise cloud use set to double in next three years

The number of enterprises turning to cloud computing to revamp existing business models will more than double in the next three years, as business leaders move to capitalize on the rapid availability of data and the growing popularity of social media, according to a new study released by IBM.



The number of enterprises turning to cloud computing to revamp existing business models will more than double in the next three years, as business leaders move to capitalize on the rapid availability of data and the growing popularity of social media, according to a new study released by IBM.


IBM (Armonk, N.Y., USA), in conjunction with the Economist Intelligence Unit, surveyed more than 500 business and technology executives worldwide to observe shirts in how organizations use the cloud today and in the future.


“Companies are starting to understand – cloud isn’t just about gaining efficiencies and cost savings; it’s about driving the kind of fundamental innovation that provides lasting marketplace advantage,” said Saul Berman, IBM global strategy consulting leader and co-author of the study.


According to the study, business leaders will increasingly use the cloud to develop new business models that can exploit the capabilities resulting from these digital trends. While 16% of the executives surveyed indicate they are already using cloud capabilities for tasks such as entering new lines of business or reshaping an existing industry, by 2015 35% intend to use it to transform their business models.


While a little more than half of the respondents indicated “improving organizational efficiency” as a top business challenge today, only 31% anticipate it will be a top challenge in three years. Instead the study indicates that their focus is shifting to growth and competitive initiatives in the future. The objectives cited by survey respondents for adopting cloud are in line with these business goals, indicating that business needs will soon rival IT motivations for cloud adoption, says IBM.


Of those surveyed, 62% said increased collaboration with external partners is a key objective for adopting cloud;  57% cited competitive cost advantages through vertical integration as a major motivation; and 56% pointed to opening new delivery channels and markets as an important objective.


Examples cited in the report showcasing how cloud is being tapped to drive new revenue streams and enhance business models include an online marketplace for handmade goods that has used the cloud to gain access to more powerful analytics online. The company is able to analyze data from the approximately one billion monthly views of its Web site and use the information to create product recommendations, providing it with access to tools and computing power that might typically only be affordable for larger retailers, says IBM.


The study also cites an online health information network that enables the exchange of health information and transactions among healthcare providers, employers, payers, practitioners, third-party administrators and patients in India. By connecting more than 1,100 hospitals and 10,000 doctors, cloud computing‘s capabilities are helping collaboration and information sharing — helping the network to pursue a more collaborative business model and deliver improved care at a low cost.


Cloud has the power to open doors to more efficient, responsive and innovative ways of doing business, and we believe the companies that will come out on top will be the ones that find ways to leverage it as a key point of differentiation in driving business value,” says Berman. “Whether they choose to tap cloud to optimize, innovate or even disrupt their business models, they need to start working on it now.”