Peer Pressure: 3 Reasons Cloud is Critical to Digital Transformation

From risks and challenges to opportunities and rewards, cloud has fundamentally altered the way many organizations operate. It's also the foundation for thousands of disruptive companies that have built applications and services on its infrastructure from the start, making it a priority for many established organizations across industries.

The ever-expanding capabilities developed by cloud platform providers are designed to create greater business value. From driving customer engagement to bolstering employee productivity and innovating faster with advanced analytics, cloud's potential is heating up.

Reflecting on the value of these capabilities, it's estimated that "whole cloud" spending — total worldwide spending on cloud services, the hardware and software components underpinning the cloud supply chain and the professional/managed services opportunities around cloud services — will surpass $1.3 trillion by 2025, up from $706 billion this year.

What's keeping cloud front and center in the digital transformation conversation? Let's take a look:

1. It's real, and it's now.
There's a surging need to innovate and automate. Cloud enables organizations to build automation into nearly everything they do. During the pandemic, there was a rush to digital, improving the delivery of products and services online. After businesses rapidly scaled-down — then back up — they saw that leveraging cloud applications provided benefits that outlast market fluctuations. The strategic benefits of cloud, including increasing business agility, optimizing operations, reducing costs and modernizing applications, are evident.

Now we're in a new phase of post-pandemic market fluctuations, and cloud adoption at scale is driving more considerable cost optimization benefits while supporting expanded business agility. Cloud helps companies do more with less as hiring challenges prevail. Leveraging cloud for automation helps streamline processes and improve culture as employees see progress forward and want to be a part of the change. For products and services, modern applications run with a microservice architecture make them easier to build, test and maintain. When businesses need to change, launch or scale back, they can quickly modify these modular-like applications. This becomes key when the time to market is at stake.

2. The fear is over.
The benefits of cloud far outweigh the risks. Today, cloud environments built on a zero-trust model remove fear and provide a secure, end-to-end view of user behaviors to monitor activity and enforce policies. Meanwhile, cloud creates an agile platform that allows IT to support the business when they need to take swift action in response to rapid market changes. This activity becomes particularly important during a time of change, and events of the last few years are still disrupting many industries.

With workforces being long-term remote, cloud serves as the platform organizations need to streamline work and increase collaboration. Cloud-based systems were vital in the transition to the migration of call centers across industries when remote work began — enabling uninterrupted customer service and support across locations and time zones hinged upon cloud-based connectivity.

The trend continues with more and more cloud-agnostic applications being developed for file and document sharing and virtual workspaces for enhanced collaboration. Even though organizations may hesitate to move a mission-critical application, moving it to a more resilient architecture will ultimately prove beneficial. If an organization is approaching cloud migration strategically and methodically, the risks are extremely low.

3. Big data needs a home.
Cloud data isn't just a concept; it's a necessity. Data needs a secure home where it can be analyzed in new ways to unearth hidden value. Discovering common data connections and patterns creates stories of how customers, employees, and partners react and use products and services.

Organizations have been consistently turning to the public, private and hybrid-cloud environments to store and manage their data. Hybrid cloud deployment is proving to be the best of both worlds for companies needing to protect highly sensitive data and maintain the flexibility to share information seamlessly. Access to real-time data offers insights into business performance and helps organizations set goals based on business intelligence. Says Rick Villars, group vice president, Worldwide Research at IDC, "Entire industries want to intelligently leverage data to their advantage and can do so because they have faster access to digital technologies built on a cloud foundation."

Connecting all data sources empowers digital transformation, and applying artificial intelligence (AI) enhancements unlocks hidden data gems. AI models can process data in seconds, not weeks or months. For example, Blue Cross Blue Shield built a cloud data lake that enables the firm to make data connections to improve care, lower costs and grow membership.

Keeping pace with change
Digital native companies recognize the benefits of migrating to a cloud-based platform. Now organizations of all sizes and in all sectors are ready to unlock cloud's potential. To be able to turn on a dime when running applications has far-reaching benefits. When organizations start with a pilot project, publicize early success, and expand to create iterative successes, enterprises can achieve transformative results with cloud at scale.

The right strategy to navigate the transition can make the difference between a smooth and easy digital transformation to one fraught with drama and frustration. Starting the cloud journey on the right foot is just as important as the steps that come after because maximizing cloud benefits is a continuous process of learning and innovation.

To learn more about how cloud is driving enterprise value, get our latest Cloud Insights.