Breaking down the stages of cloud adoption

Breaking down the stages of cloud adoption

Published: 7/6/2015 2:04:22 PM

Judging from how much media attention they regularly receive, you might think that cloud-based infrastructure and applications have already been widely adopted by both large organizations and small and midsize businesses. You'd be right. The 2015 State of the Cloud Survey from RightScale found that 93 percent of its respondents, polled from firms of all sizes, were using some form of cloud computing. More specifically, 88 percent of enterprises were taking up the public cloud, while SMBs were also diving eagerly into infrastructure-as-a-service offerings such as Amazon Web Services. 

Cloud financial software as engine for productivity and savings
Beyond infrastructure for internal IT workloads, the cloud can also provide a powerful vehicle for delivering software on demand. Applications hosted, maintained and updated by a cloud service provider often boast greater convenience and lower costs than traditional on-premises alternatives:

  • Last year, Rackspace senior content writer Franklin Morris noted that 70 percent of businesses had reinvested the savings that came from transitioning to the cloud.
  • Likewise, half said that they had been able to pursue new opportunities thanks to the time they saved from using cloud software.
  • More than one-third also stated that they had improved their level of customer service as a result of taking up cloud-based solutions.
  • SMBs were actually ahead of enterprises in some aspects of cloud adoption, notably in development of strategy (20 versus 16 percent, respectively) and how heavily they had come to rely on cloud infrastructure (26 versus 18 percent).

Based on these figures, we can see a very positive outlook for cloud computing uptake among SMBs. Cloud financial software is a perfect example of how the cloud is opening up exciting new possibilities for these businesses, not only in terms of what new functionality (e.g., mobile access from any IP-enabled device) they can tap into, but also in the level of economy they can expect from tools that are easy to pay for, maintain and scale as their operations grow. Accounting software in the cloud, for instance, is a huge leap over the time/money-wasting errors of spreadsheets.

That said, adapting to the distinctive infrastructure and software of the cloud is a huge change for most organizations, especially if they have years of doing things differently under their belts. Their journeys may in some cases resemble the classic Kubler-Ross model from psychiatry, better known as the five stages of grief - denial, anger, bargaining, depression and acceptance.

The comparison may be a bit dramatic, but at least one management consultant has already made it. Moreover, plenty is at stake in the move from Microsoft Excel and/or QuickBooks to a cloud-based solution. SMBs need to know that they are investing in software that will help them identify short- and long-term financial trends, assist in their budgeting and forecasting processes and ensure that they comply with applicable regulations.

The five stages in depth
With that in mind, let's look at how a company might go through the equivalent of Kubler-Ross's five stages while adopting cloud software. The RightScale and Rackspace numbers demonstrate that many SMBs are successfully making this move to the cloud, but the paths they take might not always be easy.

Denial
It is sensible for some organizations to be skeptical of the cloud, considering how heavily invested they are in on-premises software and how they may be beholden to regulations pertaining to data provenance. With SMBs, the initial barriers usually are not as large, although anxiety can still prevail - companies may still deny that they can benefit from using the cloud.

"Denial often overlooks the extent to which a business already relies on the cloud."

This sort of denial often overlooks the extent to which a business and its employees may already rely on the cloud, even if indirectly.  Online photo storage, electronic banking and streaming audio and video services are widespread, and all of them require a mix of remote infrastructure and cloud software. Identifying these popular applications can be the start of moving past this stage.

Anger
Ok, so getting angry at cloud computing is perhaps not rational behavior. Still, it is understandable that there might be at least some anxiety among IT and line-of-business as they contemplate the move from what they are familiar with to the new world of the cloud.

The unknown is often scary, and the cloud is no exception. Given how different something like business budgeting software or cloud CRM is from its predecessors, it can be useful to work with a vendor or consultant that can relate to the potential challenges of switching.

Denial is a common initial reaction as businesses make the move to the cloud.
Denial is a common initial reaction as businesses make the move to the cloud.

Bargaining
The popularity of hybrid cloud architectures - i.e., ones that blend the elasticity and scalability of public cloud resources with the control and security of private cloud infrastructure - speaks to the ability of organizations to bargain and make a pragmatic move into the cloud. A company does not have to go from no cloud to full implementation overnight.

"[H]ybrid IT solutions have been maturing, and now they can be a perfect match for SMBs, not just large enterprises," explained Nick East of Zynstra in a column for VentureBeat. "Offering the full flexibility of cloud coupled with the assurance that comes from incorporating on-premises data centers, hybrid IT can be delivered as a seamless service."

In the same way, businesses may choose to cloudify their functions one by one. Finances are a good place to start, since cloud-based tools can provide the insight needed to plan a company-wide transition from traditional to next-generation IT services.

Depression
Buyer's remorse and the desire to go back to the familiar old paradigms can emerge once the cloud wheels are set in motion. Again, unfamiliarity with the cloud is a common trigger of this reaction, and it should be waited out until the impact of cloud software on the business becomes clearer.

It is important to be patient with cloud solutions. For example, their benefits may become more apparent once the business using them makes it past the date at which it would have otherwise made a costly in-house infrastructure upgrade.

Acceptance
Ultimately, the cloud often proves to have been the best option for businesses seeking to reduce costs as well as gain extra flexibility in how they access, use and scale their software. The journey from on-premises tools to cloud successors may take time, but it can pay significant dividends at the end of the day.

The convenient pay-as-you-go business model of software-as-a-service, which usually includes maintenance and upgrades, makes it easier over the long run for businesses to free up time for other projects. On top of that freedom, SMBs get comprehensive accounting functionality in a straightforward SaaS package so that they can avoid errors and move faster to collect and analyze financial information.

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