New research from global consulting company Capgemini has indicated a significant step change in enterprise cloud adoption through the increased use of cloud native applications – applications and services built to perform optimally in the cloud, leveraging platform as a service (PaaS).
According to the study, 15 per cent of new enterprise applications are cloud native today, with adoption set to increase rapidly in the next three years, jumping to 32 per cent by 2020.
Franck Greverie, cloud and cybersecurity group leader at Capgemini, said: “This is an exciting shift in our industry. We predict that cloud-native architectures will become the default option for customer-facing applications by 2020, driven by a need to continuously deploy innovations at an accelerated pace and enhance the customer experience.
“Businesses that delay adopting this approach will struggle to make up the gap with cloud-native competitors.
“Organisations need to listen to their CIOs and understand the huge potential of cloud-native technology to deliver business benefits and innovation. CIOs must also address culture and skills gaps within their own organisations on the road to being cloud-native leaders.”
The study of more than 900 senior professionals working in both IT and the wider business, from 11 countries across Europe, the Americas and Australia, attributes this shift in cloud adoption to a desire to improve business agility (74 per cent), increase collaboration with external partners (70 per cent) and deliver better customer experiences (67 per cent).
It identifies a small group of ‘leader’ organisations that are already committing to cloud-native applications – those with more than 20 per cent of their new enterprise applications developed in this way – with these leaders almost twice as likely to report increases in organisational revenues attributable to cloud-native applications than slower adopters (84 per cent versus 44 per cent).
Compared with the laggards (organisations where less than 10 per cent of new applications are built using a cloud-native approach), cloud-native leaders also:
- Are more likely to describe their approach to software development as agile (69 per cent to 37 per cent), their deployment as automated (78 per cent to 46 per cent), and their development operations teams as integrated (69 per cent to 38 per cent).
- Display a more growth-focused attitude towards IT functions, with improving the customer experience (90 per cent), business agility (87 per cent) and scalability (85 per cent) viewed as higher priorities than reducing costs (79 per cent).
The study found that as adoption increases, CIOs at organisations leveraging or planning to leverage cloud-native applications expect IT to become even more central to supporting business ambitions, including the development of new business models (67 per cent), rapid scaling of the business (72 per cent), quicker updating of products/services (71 per cent) and adopting new routes to market (68 per cent).
However, many CIOs are facing challenges in building business cases to invest in cloud-native apps from business leaders that see cost reduction as the priority for IT teams.
These challenges range from the organisational, including battling an ingrained culture that is opposed to the nature of cloud-native working (65 per cent) and a skills shortage when developing cloud-native apps (70 per cent), to the technical, such as difficulties integrating with legacy infrastructure (62 per cent) and being locked in to vendor contracts (58 per cent).
Digital challengers drive sector disruption
Just over a quarter of high-tech firms (26 per cent) and almost a third of manufacturing firms (29 per cent) are cloud-native leaders, compared with just 11 per cent of banking providers, 18 per cent of insurers and 22 per cent of consumer products, retail and distribution (CPRD) firms.
Priorities are changing as a result of the digital challengers – banks now build 10 per cent (the average across all banks surveyed, including leaders, late adopters and laggards) of their new applications using a cloud-native approach, while almost half of insurers (47 per cent) and almost one-third of CPRD firms (27 per cent) say that cloud native forms a core part of their technology strategies.
All three groups – banks, insurers and CPRD firms – plan to spend considerably more on PaaS in three years than they do today (41 per cent, 44 per cent and 41 per cent respectively).
Building a cloud-native business
The report also offers six recommendations to help CIOs turn their organisations into cloud-native leaders:
- Assess the application portfolio and identify priorities for cloud-native development.
- Build credibility by demonstrating a cloud roadmap and ability to deliver growth.
- Start small and then scale up to develop a skilled team.
- Adapt the IT operating model to support both business agility and stability.
- Be pragmatic in selecting technologies.
- Incubate a culture of innovation, collaboration, testing and learning.
Cannes in Cairns, presented by Pinterest, is thrilled to announce that none other than Microsoft will be hosting an offsite networking lunch at Cairns’ stunning Salt House restaurant on Thursday the 3rd of February as part of the event’s packed agenda. As a silver partner to the event, Microsoft (who, we’re sure you’ll agree needs […]
Creative design marketplace, DesignCrowd, has announced reaching the milestone of one million registered designers on its global platform. The Aussie crowdsourcing start-up currently has a 1,004,000-strong freelance designer network, which has grossed over $A62 million since the company’s 2008 launch. The network have completed over 26 million graphic, logo and web designs for both small […]
The Chiefs and Optus today announce a partnership extension that will see the brands continue to collaborate around gaming content in Australia for a further 12 months. The news follows a successful 12-month partnership, including members of The Chiefs featuring in Optus’ Gamer Plan launch supporting the development of Optus’ Streaming Booth. Much of the […]
During the month of October, $A8.5 million was spent in digital travel advertising and digital impressions were up almost 40 per cent from September, according to the Nielsen Ad Intel report. The report found that the top advertisers amongst cruise lines from October in order are Emerald Cruises, Oceania Cruises, and Royal Caribbean. Amongst the […]
Integral Ad Science (IAS) announced the expansion of its context control solution for advertisers and publishers globally to give customers more control over the context of digital ad placements. IAS CEO, Lisa Utzschneider (featured image), gave insight into the enhancement, saying: “We first launched context control to help our customers transform their targeting strategies, and […]
Programmatic video advertising platform Unruly has introduced content level targeting that standardises attributes across genre and rating segments enabling scaled buying on premium video content. Today Unruly announced the introduction of its content level inventory that segments inventory based on publisher bidstream attributes that mirror linear TV buys, such as genre and rating. The solution […]
Golden Circle is bringing a splash of sunshine to the Australian Summer with the launch of an innovative, SmilePay vending machine. The machine was created by 72andSunny, and software development company, Enabled 2 GO Technologies. It uses existing smile recognition software to recognise an Aussie smile and in return release a complimentary ice-gold Golden Circle fruit drink […]
Almost half (49 per cent) of Australia’s marketing, media, and communications employees feel their managers are showing little, if any, concern for their mental wellbeing, a new report has found. The report – conducted on behalf of the Australian College of Applied Professions in October 2021 – surveyed 1000 nationally represented workers and found some […]
Meta has partnered with creative agency, Now We Collide to showcase the strength and resilience of small businesses around Australia. The campaign “Good Ideas Deserve To Be Found,” features the stories of four Australian businesses including Singing Magpie (SA), BoardSox (VIC), D-STILL Drinkware (QLD) and Survival Emergency Solutions (NSW). Each story shows how the business […]
The internet is invaluable but cyber security fears are keeping Australians offline. According to new research released today by the .au Domain Administration (auDA), almost 90 per cent of Australians say the Internet has a positive impact on their lives. Moreover, almost all small businesses (98 per cent) depend on the Internet as an invaluable […]