TCS’ 2020 CIO Study shows that CIOs see cloud computing as the bedrock of digital transformation. Why they see it that way is important for every member of the C-suite to understand. It’s not clear that top management at large companies worldwide see cloud computing as the disruptive technology force that it is becoming.
CIOs in 11 industries in the U.S., Canada, the U.K., Germany and the Netherlands view cloud computing as the most important technology to their digital transformations during the past decade. Ninety-one percent of the 1,010 CIOs and other IT executives who participated in the study named cloud computing among the top three technologies in the last 10 years. Three out of four put cloud computing in the top two.
This is a notable result when one considers the other technologies about which we asked study participants. There was a strong consensus:
• At least 80% of CIOs saw artificial intelligence (AI), machine learning and the Internet of Things as top-three technologies, but none reached the level of cloud computing.
• CIOs said the cloud was more important than mobile devices, virtual reality and augmented reality, and 3D printing.
• 75% of CIOs said cloud computing had an extreme or high impact on their businesses – higher than answers for the Internet of Things, AI and mobile devices (all ranked by 64% as having an extreme or high impact), virtual reality and augmented reality (47%), and 3D printing (25%).
As a leader of cloud infrastructure services at TCS, I view our survey results as a confirmation of what our customers are telling us. Plainly put: It’s impossible for most companies to digitally transform their businesses without cloud computing. Every firm needs public, private or hybrid cloud computing services to support at least some of their IT applications and infrastructure needs for two main reasons.
First, cloud computing makes compute-intensive tasks flexible and affordable, whether those tasks are an interactive online customer experience or a key digital business process to generate demand or provide customer support. The cloud extends what you can do now and makes it better for less cost.
The second reason every company needs to tap the cloud is the cloud’s role as a digital transformation accelerator. By shifting their on-premise systems to public and/or private clouds, a company can adapt its business model quickly while taking advantage of technological advances that cloud providers offer. And the cloud acts as a standards-based conduit for companies to connect with their ecosystem partners, rather than having to create custom-built linkages. For example, mergers and acquisitions leveraging cloud options for IT as a service generally accelerate the time to value for such deals.
Taken together, these two benefits make the cloud a gateway to the other technologies listed in our study. Companies in different industries can access AI and machine learning applications, for example, or use the cloud to launch a new IoT-enabled service.
At the same time, the cloud is more than a way to reduce costs, even as it presents a way to shift hard-to-maintain legacy systems (like ERP and CRM) to a more manageable environment. Enterprises adopting cloud strategies – public, private and hybrid – are achieving lower total cost of ownership and driving their digital transformation initiatives. CIOs and other business and IT-decision makers will miss a great opportunity if they look at the cloud only through a cost-savings lens.
The cloud is much more than that. By focusing on the capabilities that the cloud offers, CIOs and other business leaders can change how their IT systems operate. They can more easily and more economically introduce new technologies into their companies. They can offer new digital customer experiences and experiment with new business models, supported by cloud-based systems.
CIOs in the TCS study recognize this. The cloud is so central to the work of transforming their companies that CIOs say it will remain a key enabler going forward.
When asked to rank the importance of various technologies in the next decade, 68% of CIOs said cloud computing would have an extreme or high impact. While this was less than AI (ranked by 80% as expected to have an extreme or high impact) and machine learning (71%), the result underscores the theme.
After all, CIOs can’t expect AI and machine learning to have a big impact without the cloud underpinning those capabilities. You can’t innovate, you can’t transform, you can’t move forward without the cloud.