Guest blog by Owen Rogers, Research Director of Cloud & Managed Services Transformation at 451 Research, a part of S&P Global Market Intelligence.
The beehive is a microcosm of complexity. Each of the 50,000 bees inside has its role, from caring for the young to guarding the colony, to foraging for food. This complex environment provides the bees with security, sustenance, and the ability to reproduce. Complexity hasn’t hindered the hive – rather it has enabled bees to thrive.
This is similar to what we are seeing in the technology industry today as the cloud introduces a new (and increasingly mainstream) way of doing things.
Enterprises want to choose the latest technology from a range of providers that together exactly suits their needs, lets them innovate, and drives overall business value. This increase in complexity is actually allowing enterprise IT to deliver greater value in the form of differentiated offerings, more efficient applications, happier customers, and lower costs. The complexity doesn’t necessarily need to be resolved or reduced, doing so may well reduce its value.
Enterprises like the no-capital, consumption-based cost models that cloud brings, but it’s become clear that enterprises also want control and options over which providers are best for each application’s needs. As the 451 Research Cloud Price Index shows, enterprises don’t suit a ‘one size fits all’ approach.
According to our Voice of the Enterprise: Digital Pulse, Budgets & Outlook 2019 survey, 62% of enterprise decision-makers identified hybrid as their primary IT environment strategy. The top reason for this was the need to leverage vendor-specific platform capabilities (as well as existing on-premises resources). Hybrid cloud is an aspiration for enterprise decision-makers because it lets them choose the capabilities that best suit their needs from a range of providers and vendors.
In a 451 Research study commissioned by the cost management firm Cloudability, 58% of 300 decision-makers said they were overspending on cloud resources compared with budget. Perhaps more alarmingly, this spiraling complexity was affecting more than costs: 38% said sub-optimal application service levels were the result, and a quarter stated that innovation was affected.
While this might sound like a negative, it’s important that the industry recognize that complexity isn’t necessarily something to be resolved, or something that needs to be simplified for the sake of simplification. The complexity allows the business to be more agile, more effective. The industry needs to think about cloud today in those terms – optimization, not resolution.
So, what’s the difference between the two? Resolution suggests a one-time event with disruption of the value chain by dumbing it down; optimization suggests an ongoing need to reassess and react while enabling greater value.
Enterprises need to be aware of complexity and manage it appropriately. But avoiding complexity can put you at a competitive disadvantage. Use tools, managed services, and expertise that seek to strike a balance. Track and control spending and consumption but give employees boundaries rather than strict controls so they can experiment and innovate with a degree of freedom. Embed a culture of ongoing optimization so employees can consume resources without the worry of costs slowing down innovation. The bees need to be controlled, but ultimately, they are valuable because of the complexity they have created and the freedom they have to do what comes naturally.
To learn more about how to harness cloud complexity and drive collaboration, innovation, and growth, watch this webinar.
Owen Rogers is a Research Director of Cloud & Managed Services Transformation at 451 Research, a part of S&P Global Market Intelligence. He also leads the firm’s Digital Economics Unit, and is the architect of the Cloud Price Index, 451 Research’s benchmark indicator of the costs of public, private and managed clouds. Owen is head of 451 Research’s Center of Excellence for Quantum Technologies.
In 2013, he completed his PhD thesis on the economics of cloud computing at the University of Bristol. Prior to this, he held product management positions in Cable&Wireless and Claranet. He is a Chartered Engineer, a Member of the British Computer Society and a Certified Beekeeper. Owen was named ‘Innovative Analyst of the Year’ in the Institute of Industry Analyst Relations’ global awards in 2018.
