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Cloud not meeting CIO expectations and SaaS still dominates take-up

Karl Flinders

Software as a Service (SaaS) is dominating cloud adoption as CIOs fail to meet their expectations regarding cloud computing services.

According to a survey by sourcing consultancy Alsbridge, 90% of CIOs are using cloud services, but this is largely one flavour. SaaS dominates, with 70% of CIOs using it, compared to 32% using Platform as a Service, 20% using Infrastructure as a Service and just 14% adopting cloud based storage.

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The research is based on an independent survey of 50 senior IT decision-makers from large UK organisations and was conducted by Coleman Parkes on behalf of Alsbridge in May. 

John Sheridan, head of IT outsourcing at Alsbridge, said cloud has been hyped up by consultants and suppliers alike for many years. “ But in truth there is still caution around its wider adoption beyond SaaS and ‘sand-boxed’ platforms,” he added.

“Cloud may be a good fit for a small to mid-sized business model, but our study reveals that IaaS cloud adoption at a large corporate level is in fact still relatively low.” 

Part of the hold up in adoption could be to do with the cloud constantly failing to meet the expectations of CIOs.

According to the findings the greatest mismatch between expectations and results is seen in operational cost savings, While CIOs expected savings of 74% only 41% was achieved.

Despite the failure to meet expectations, the research found that IT leaders plan to increase their spend on outsourced cloud to 26% of annual IT budgets on average in the next twelve months, compared to 20% currently. 

But there are still barriers to overcome for cloud computing to reach its potential. A total of 65% of respondents said data sovereignty and privacy is their top concern while 10% cited integration with existing systems and 5% a lack of skills.

In a recent interview with Computer Weekly, John Keppel, president ISG Northern Europe, which carries out quarterly research on global outsourcing said between 10% and 15% of total IT outsourcing spending was on cloud services in the third quarter of this year. This compared to between 5% and 8% in the same period last year.

“In the last 24 months cloud computing has gone from a little bit of hype into reality and big enterprises are beginning to use it.”

Keppel said organisations are under pressure to cut costs, so if early cloud investments prove to the business that they lower costs, investments in cloud computing will increase. “If the business gets what it wants spending [on cloud] will increase.”

He added that SMEs are moving to the cloud much quicker, because it allows them to punch above their weight and there are fewer barriers to adoption.

 


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