Debunking Common Myths about Cloud – McKinsey
While the IT market, in general, is declining due to the pandemic, the cloud computing industry has been growing exponentially. According to IDC, vendor revenue from sales of IT infrastructure products for cloud environments, including public and private cloud, increased 34.4% year over year in the second quarter of 2020. Investments in traditional, non-cloud IT infrastructure declined 8.7% year over year in 2020.
Cloud services allow to quickly meeting the need to organize workspaces for remote employees and provide secure access to enterprise applications from different devices. The need for collaboration tools, rapid resource deployment, and accelerated application development is driving the growth of major segments of the cloud market - IaaS, PaaS, and SaaS.
The main drive for this growth is the pandemic. Remote work has increased the demand for collaboration services and e-learning. However, mistrust of cloud security is still keeping companies from reaping the full benefits of the cloud. McKinsey analyzed the opinions of hundreds of executives and IT directors and listed the most common misconceptions that hinder the transition to the cloud. In the article, we will go through some of them.
Reducing IT costs is the main value of the cloud
CAPEX saving is the most common thing emphasized when talking about the benefits of cloud technology. That is true but in reality, not the only advantage a company could gain from implementing a full cloud stack and changing its IT operating model. When considering whether to move to the cloud, it is important to pay attention to the business benefits of such a decision.
The effects of moving to the cloud will have a far greater overall financial impact than the expected cost savings. Clouds help to launch products to market faster and improve analytics. For example, access to powerful computing resources allows you to solve complex analytical tasks, and thereby better understand customer needs and your business in general. Implementing innovations becomes less risky because it costs cheaper and takes less time to test new ideas. All this enables a company to quickly respond to market demands and increase competitiveness. Thus, the main stimulus to cloud migration should be business benefits, instead of improvements in IT efficiency.
An in-house server is more secure than the cloud
Information security remains the main argument against moving to the cloud. Yet, cloud providers are able to protect data far more effectively than the average company. They use various tools and methods to protect the cloud at every level, from infrastructure to services.
Nevertheless, according to the KPMG Cloud Threat Report 2020, 75% of companies surveyed lost data while using cloud services. But most of the leaks are not the providers' fault, but customers' own misconfiguration of their applications. According to Gartner, by 2025, 99% of all cloud security breaches will be caused by customers, rather than by providers' security flaws.
Keep in mind that cloud security is a shared responsibility. Customers should not rely solely on the provider's team regarding information security, instead, they must apply measures to improve cloud security.
Moving to the cloud eliminates the need for IT-department
With Infrastructure as a Service (IaaS), the cloud provider is responsible for managing servers, storage, networking, and other equipment, so some business leaders mistakenly believe that they can completely abandon the IT department, at least the IT infrastructure specialists. Cloud providers offer many different services, with different options, and you need a specialist who can deal with them, select and configure the right ones to create an optimal configuration. To perform these tasks, IT staff must have a particular skill set. Besides, with cloud adoption, IT's operating model changes from reactive to proactive. Those responsible for cloud infrastructure must learn to anticipate the company's needs and turn the cloud into a reliable automated platform.
Moving to the cloud means you must either lift and shift applications as they are or refactor them entirely
Committing to move to the cloud, companies want to do it as quickly as possible so that to achieve the promised business benefits. While the lift and shift strategy is quick and cost-effective, it does not provide the expected benefits because the architecture of applications is not optimized for the cloud. As a result, they can have performance issues, increased latency, etc. Refactoring applications for the cloud is expensive, time-consuming, and prone to errors. Many companies, therefore, opt for an intermediate strategy, using the best of both approaches – they apply methodologies such as automation, abstraction, and containerization. These methods are less costly and less time-consuming than full application refactoring, while still delivering all the benefits of the cloud.
The heavy bias of cloud migration is fueled by failed experiences and a fear of change. However, the pandemic is forcing even the most conservative companies to change their attitude to the cloud, especially since a crash test in extreme conditions has confirmed their viability. And, as McKinsey summarizes, misconceptions should not stand in the way of obtaining business benefits from cloud services.