Organizations are struggling with how to measure the payoff for cloud computing, according to a survey conducted by The Open Group.
Organizations are struggling with how to measure the payoff from cloud computing, according to a survey conducted by The Open Group.
More than 60 percent of respondents surveyed say their organizations do not currently have a return-on-investment mechanism in place. The Open Group surveyed 307 cloud specialists at global organizations that ranged in size from fewer than 200 employees or more than 5,000 employees in February and March of 2011.
The survey included government IT professionals, but the results have not been broken out by sector, said a spokesperson for The Open Group, a vendor- and technology-neutral consortium that focuses on the development of IT certifications and standards.
Cloud computing provides on-demand network access to a shared pool of configurable computing resources that can be rapidly provisioned and released with minimal management effort or interaction from the service provider.
Cloud will continue to be at the forefront of IT discussions due to the potential system optimization and cost savings that are associated with it. However, industrywide motivation and the business impact of cloud implementation remains unclear, the survey states.
“Return on investment is probably the most commonly used measure of success of a technical change," Chris Harding, forum director for The Open Group Cloud Computing Work Group, wrote in a blog on May 9.
Some survey respondents think that cloud ROI should be easy to evaluate and justify. Cost, quality of delivered result, utilization, speed of operation, and scale of operation are the most useful metrics. But only 35 percent have mechanisms in place to measure cloud ROI, as opposed to 45 percent that did not, with the other 20 percent being unsure, Harding said.
“The question on the impact of cloud produced the most striking of the survey’s results,” he said. “While 82 percent said that they expected their cloud initiatives to have significant impact on one or more business processes, only 28 percent said that they were prepared for these changes,” Harding said.
Last year, The Open Group released a white paper, “Building Return on Investment from Cloud Computing,” to give organizations guidance on measuring cloud ROI.
The Open Group plans to do more to develop understanding of the business impact of cloud computing, Harding said. The organization will publish The Open Group Guide to Cloud Computing for Business later this year and will continue to develop the theme at conferences and in the Cloud Computing Work Group discussions, he added.
Federal and state agencies are increasingly moving operations to the cloud, looking to free up data center space, cut maintenance costs and power use, increase the availability of systems for mobile users, and, above all, save money. Also, the Office of Management and Budget requires federal agencies to move three applications to the cloud in the next 12 to 18 months.
Major conclusions of the survey include:
- A majority of organizations needed buy-in from the CIO or another C-level executive to fund cloud computing initiatives.
- The main drivers behind cloud computing implementations were cost, resource optimization and timeliness/agility of new services.
- Most organizations using cloud computing did not have an ROI mechanism in place.
- Eighty-two percent of survey participants said cloud computing would significantly impact one or more business processes.
- The top concerns surrounding cloud computing were security, governance, integration issues and ability to cope with business process change.