Overview
Cloud Evolution: Mandate to Modernize is the culmination of primary market research targeting 532 senior executives across the globe.
In this report, we document the results, which provide insights into how businesses are modernizing cloud infrastructure, application modernization using cloud native architectures and platform engineering for automation.
The new data on generative AI solutioning is compelling. One message recurs throughout the report: companies responding to the survey position cloud as the core technology driving innovation and efficiency. The primary reason for cloud adoption is access to critical services and emerging technologies unavailable on-premises.
GenAI, as a cloud use case, has supplanted traditional use cases like burst capacity, test/dev and backup and disaster recovery.
Cloud Evolution: Mandate to Modernize
By the Numbers
Trends
Multicloud and Hybrid Cloud
The research reveals that businesses intentionally partner with multiple cloud service providers (CSPs). By thoughtfully leveragingthe strengths of multiple platforms, businesses believe they can increase resilience and leverage capabilities required by the business to modernize and automate business processes. Hybrid environments are projected to persist especially for industries having regulatory concerns and using protected data to fuel AI initiatives.
85% of organizations plan to increase public cloud partnerships in the next 12 months
60% of companies that participated in the research have IT and business leaders at the table to discuss the suitability of different CSPs for discreet workloads and data requirements. Modernization initiatives utilize multiple cloud services within a single heterogeneous infrastructure. Managing multicloud requires IT to design and implement a governance framework for managing these cloud resources, FinOps to increase ROI and provide guidance for aligning security configurations and ensuring access controls are in place.”
Siki Giunta
Executive Vice President & Head of Cloud Native Center of Excellence
HCLTech
The recognition of cloud as a business enabler is at an all-time high, with organizations investing in cloud to drive transformative change. By leveraging cloud technologies, businesses innovate faster, scale efficiently and position themselves to gain a competitive edge. There is no question that cloud is playing a significant role in enabling enterprises to achieve long-term objectives and remain agile in highly competitive markets”
Andrew Faid
Head of Cloud Business Office, oCTO
Fonterra
GenAI Technology Solutions
82% of survey respondents believe that GenAI will positively impact enterprise productivity. The report suggests that over four-fifths of businesses are developing or planning to develop GenAI solutions. Businesses prefer using their proprietary data for training models and inference engines.
57% of organizations already leveraging GenAI for proprietary data use cases
Generative AI has brought previously unimaginable possibilities and changes to an enterprise's strategy and value streams while democratizing functions like software development and cloud transformation and enabling differentiated business capabilities. Enterprises require a unified data and AI strategy with the underlying cognitive infrastructure to effectively utilize structured and unstructured data for better insights and outcomes.
In addition to engineering capabilities, we believe the right change management approaches, new AI-driven KPIs and reskilling and upskilling of employees will be crucial to successfully scaling AI. We call it "AI that delivers ROI."
Vijay Guntur
Chief Technology Officer and Head of Ecosystems
HCLTech
The Pivot to Application Modernization
The survey says that application modernization is now preferred over the migration of monolithic applications by a significant margin. When firms were driven by cloud economics, decisions were often taken to quickly migrate (lift and shift) applications to cloud. Today, 80% of respondents agree that the value of the public cloud can only be fully realized if applications are modernized when migrated. Application modernization is now the preferred method for migrating applications to the cloud. Respondents did note two exceptions.
Application modernization requires architecture refactoring – replacing monolithic application architectures with more flexible micro-services based architecture better suited to cloud operations. Containerization improves application portability and allows for consistent operations across different environments.
Pawan Vadapalli
Corporate Vice President and Global Head, Digital Business Services
HCLTech
Advanced AI solutions require the cloud. The computational requirements and extreme data needed to train the models depend on the scale of the cloud. AI solutions will optimize business processes, enhance customer experiences and improve decision-making capabilities. By leveraging AI, organizations are positioning themselves at the cutting edge of technological advancements.
Tammy Lawson
Manager, Database Administration
Sonoco Products Company
Cloud Native Development and Platform Engineering
Application modernization is now the preferred method for migrating applications to the cloud. Monolithic application architectures are being replaced by cloud native architectures, with 78% of survey respondents agreeing that cloud native approaches drive improvements. In addition, 76% of these firms report they employ platform engineering extensively or for some subset of their development projects.
86% are employing platform engineering
As enterprises continue to accelerate their digital transformation agendas, they are increasingly focused on platform-driven business models as a cornerstone to drive innovation and growth. Robust and scalable platforms help enterprises engineer secure, reliable and optimized cloud native applications that can scale rapidly as the business grows without compromising on security, reliability, availability and a seamless and secure cloud experience.”
Hari Sadarahalli
Corporate Vice President and Global Head, Engineering and R&D Services
HCLTech
Organizations report that working with partners has provided added value
Most organizations (83%) engage third-party consultants for successful multicloud implementations. This collaboration results in enhanced IT efficiency, better application performance and minimized vendor dependency. An overwhelming 98% of participants recognize the vital role these partnerships play. This report underscores the necessity of expert guidance to attain optimal outcomes.
The convergence of multicloud, cloud native architectures and generative AI is reshaping the enterprise landscape. Global System Integrators (GSIs) are at the forefront, providing organizations with cutting edge solutions and accelerators built on deep industry expertise to tackle these complexities. GSIs can cocreate executable strategies that drive measurable outcomes, empowering businesses to transform faster, innovate at scale and unlock the full potential of their technology investments with precision and agility. From optimizing multicloud environments to supercharging AI adoption, we're committed to our customer's success."
Jagadeshwar Gattu
President, Digital Foundation Services
HCLTech
Key Takeaways
Plan for hybrid infrastructure in generative AI projects
Build and invest in platform engineering teams
The value of partnering with Global Systems Integrators (GSIs)
Proactive multicloud strategies
Invest in frictionless IT operations technologies
Capabilities
GenAI
We have been building and deploying enterprise AI solutions for almost a decade. Our strong AI and GenAI engineering, data and analytics expertise and proven industry value chain transformation capabilities uniquely position us to deliver business impact from AI.
Cloud
Our cloud strategy offers a comprehensive cloud consulting platform, enabling continuous modernization, increased agility and operational efficiency through adaptive solutions and cloud partnerships.
Application modernization
We combine cloud technologies and agile practices to modernize applications, leveraging generative AI for agility, innovation and long-term revenue growth.
Platform engineering
We deliver comprehensive Engineering and R&D Services, empowering your platform engineering ambitions, driving innovation and unlocking new revenue streams in the platform economy.
Cybersecurity
We provide cybersecurity services that ensure an adaptive security posture, focusing on people, processes and technology to protect your dynamic business environment.
Industry Reports
Explore the transformative impact of cloud strategies across various industry sectors. The Executive Summaries by industry provide a concise overview of unique differences in survey responses.
Consumer Services
Discover how cloud adoption shapes consumer service's future, enabling organizations to improve service delivery and customer engagement.
Life Sciences and Healthcare
Examine the role of cloud computing in advancing healthcare and life sciences, from improving patient care to streamlining research and development.
Financial Services
Learn how financial institutions use cloud solutions to enhance security, ensure compliance and innovate in a rapidly evolving market.
Manufacturing
Understand how the cloud drives manufacturing innovation, supporting everything from production processes to supply chain management.
Technology and Telecommunications
See how tech and telecom companies leverage cloud platforms to scale their operations, improve connectivity and accelerate digital transformation.
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