As an Accenture cloud leader, I get to talk to a lot of companies about their efforts and aspirations in the cloud space. I also spend a lot of time with cloud providers discussing their solutions and plans for the future. Over the years, I’ve gotten a firsthand look at the challenges companies face in adopting cloud, as well as the cloud solutions and capabilities that are here today and on the horizon.
Accenture itself is now over 90 percent in the public cloud. A statement not many companies with $40 billion in revenue and 450,000 employees can make. The biggest issue most organizations like yours may struggle with is how to govern usage, manage cost and secure your cloud estates. You may be encumbered by legacy tools ill-suited for cloud, or by staff with legacy Information Technology Infrastructure Library (ITIL) bias. At the same time, you’re trying to keep pace with the level of innovation coming from the dominant players in the cloud services market. This market has experienced a profound shakeout over the past five years and has coalesced around Amazon, Microsoft and Google—the Hyper 3—as the foundation for an enterprise’s journey to cloud.
The fact is, the pace of cloud innovation and adoption is rapidly accelerating across regions and industries, bringing compelling new opportunities as well as greater complexity and risk. And that makes companies like yours, who are increasingly facing “make or break” decisions, hungry for guidance and direction.
That’s the purpose of this blog post. In it, I highlight the nine main trends that I see can have the biggest impact on your journey to and use of cloud. The idea is to provide some clarity to you about how current market forces are driving change and innovation in the enterprise—both today and beyond.
Force #1 - CapEx investments secure the hyper 3 winners
Let’s start with Amazon, Microsoft and Google, which clearly dominate the global cloud services market. Collectively, the Hyper 3 have invested more than $30 billion in capital expense just this past year to build and scale their global cloud footprint.1 That’s an average of $1 billion per company per month—creating a significant gap between them and any remaining entrants or wannabes.
This substantial investment is not just for building infrastructure and facilities. The Hyper 3 are also investing heavily in innovative new services and capabilities that pale in comparison to legacy approaches—leaving companies scrambling to keep up. Aligning your enterprise IT investment with any or all of the Hyper 3 will help make you more competitive in the coming years and allow you to manage down technical debt and decouple from the past.
Force #2 - Private cloud finds its specialty
There’s much uncertainty in the market about what defines a true private cloud. Opinions vary, and the multiple answers from a broad range of legacy vendors are a source of considerable confusion. However, successful private clouds are now defined around solving a specific use case, such as conforming to data sovereignty needs or supporting edge-use cases. Newer offerings to extend virtualized environments to public cloud, or bring public cloud attributes on-premise, are just that: new and immature.
If the goal is agility, cost reduction, or speed, then your choice should skew public. If, for whatever reason, you feel on-premise is a better fit, options exist but require additional considerations. This approach may require a second migration to public cloud in the near future. And all decisions have time, risk, cost, and talent considerations.
Force #3 - Cloud tipping point forces IT to run differently
Many of you may now be moving toward a tipping point, where a substantial amount of your workload is in the public cloud. Unfortunately, most IT organizations mistakenly treat the new estate as just another data center and don’t see the need to shift their operating model to the realities of cloud management. In actuality, operating in the cloud requires a new cloud-based operating model, and along with it, people with new skills and new roles. Most enterprises will struggle to define their operating models and implement the collaborative environments needed to make it work. And, to further complicate the transition, the enterprise will find a shortage of talent—forcing the retraining of existing talent or the potentially difficult and expensive acquisition of new skills.
Force #4 - Multi-cloud is the new reality
The steady adoption of cloud services has created a complex computing environment. Some companies are in the position to plan for a multi-cloud environment, while many others simply find themselves using multiple vendors without proper planning, governance, or controls. From a cloud management perspective, this new reality makes it difficult to publish policy, manage costs, maintain security, ensure compliance, or even create a single view showing all cloud resources.
When making this transition, you need to focus on policy, tied to governance—these are critical capabilities in the multi-cloud world. Implementing and fine-tuning a cloud management strategy will smooth the road to effective management of complex environments. New processes for tag management, new controls, and new tools are needed to mitigate the risk of running a business in the cloud effectively. Tagging is especially critical: What you don’t tag, you don’t see. What you can’t see, you can’t manage.
Force #5 - Cloud management emerges as the next big challenge
In the messy real world of hybrid and multi-cloud environments, cloud management has become very complicated. Each cloud provider may offer a dashboard to manage its environment but achieving a unified view across a hybrid IT and public cloud estate is no small feat. No two cloud providers expose the same billing or management APIs, and no single tool can handle all enterprise management needs.
You’ll need talent, proven tools, and comprehensive services to deliver your long-term cloud strategy. You’ll also need to focus on where and how they add value, and that means building or customizing tools for special needs, which can create complexity and restrict upside. Any organization theoretically could create a robust management control plane. But the investment, time, and skills to do so is likely out of reach for most.
Force #6 - Native vs. niche
Your organization may also be facing the tricky decision of how, when, and where to use niche tools versus native cloud provider tools. These decisions can’t be made lightly—many pros and cons need to be explored. Do you use native PaaS capabilities or abstract your own private PaaS? Do you use native security services or leverage a new vendor across your estate?
The same questions apply to tagging and cost management. It’s important to understand where the capabilities of native consoles start and stop and derive a strategy and plan for how your organization will function across multiple clouds. You need to understand your comfort zone and risk profile. “Locking in” isn’t a bad idea if the decision where to lock-in drives value for the organization.
On the flip slide, you must be wary of the many niche vendors flooding the market and specializing in specific management components, such as governance, cost management, capacity planning, security, compliance, or configuration management. These niche vendors force IT organizations to understand what the component can really do, how it will relate to other components or services, and if it will do what the company needs both now and for the long haul.
Force #7 - Secure from start
Most CIOs realize public clouds are more secure than their own data centers. The critical difference, though, is that the threat vectors in the cloud have changed. The actions of individuals can now have a dramatic and immediate impact on security and place a significant burden on the CIO to maintain a compliant environment.
Cloud complexity stemming from operating multiple clouds, and the rapid release of new services to market, require enhanced cloud security. Each new feature added to your cloud estate also provides a new potential attack surface that must be secured.
Successful transitions involve ensuring the infrastructure of your company’s cloud environment is “secure from start” so it can accommodate the thousands of new services cloud providers roll out each year with less risk. It also involves frequently scanning the environment for threats, actively alerting security owners, and then immediately remediating any valid threats. Humans, not systems, are often the true threat. While a stack of compute may be compliant from the start, an individual may reconfigure any aspect and create risk. The key word here is real-time discovery. Humans make errors. The CIO’s job is to discover what they do as they do it.
Force #8 - Cloud’s pace of innovation drives fear of missing out (FOMO)
The pace of innovation in the public cloud is unprecedented. The offerings of new services and capabilities are astounding: literally thousands a year from a single provider. Skilled people in your organization don’t want to miss out and will be eager to try every new feature.
You can’t benefit from the Hyper 3’s innovation if it has to vet every new service. But in an attempt to assure compliance, you can instead become locked into proprietary approaches or costly compute models that leave you unable to meet the demand for innovation at speed.
Your organization needs an agile policy to enable users to capitalize on new features. Such a policy makes new services available immediately, while employing real-time discovery mechanisms and guard rails to understand which services people are consuming, as well as where, when, and how they are using them.
Force #9 - Game over. Let the games begin
The Hyper 3 winners are solidified. As the rest of the market responds shifting sands make for tricky navigation.
We’re still early in cloud’s maturation cycle and the market remains nascent. Niche cloud vendors are many but are tempting acquisition targets. When acquisitions happen, the game changes. A solution that once seemed multi-cloud aligned may become isolated as a result of the acquisition and force a pivot in a new direction. And as the Hyper 3 get stronger, competitive intensity grows and will likely continue unabated for years to come. This means that if you align with the Hyper 3 you’ll benefit from greater innovation at continually lower costs. Thus, you need to navigate with care when choosing your vendors.
As the preceding forces show, cloud remains a compelling, fast-moving, and unpredictable space. The best response for you is to be agile—able to pivot quickly while building in what’s necessary to mitigate risk and capitalize on opportunities.
Accenture has broad and deep cloud experience and is a recognized leader in cloud management and cloud managed services.
Read more on this topic and find out about Accenture’s Cloud Management Platform (ACP).