cloud computing 2012 - university of...

October 2012

Cloud Computing 2012

Adoption, Impact and Outlook

© 2012 SAP AG. All rights reserved. 2 Public

SAP and Knowledge@Wharton Insights on Cloud Computing

“Cloud computing has reached a tipping point.”

-The Wall Street Journal, September 2012

About This Report

SAP and Knowledge@Wharton have combined

forces to investigate the impact of cloud computing

on global business

The first phase of this work focuses on current

expectations, levels of adoption, the impact,

and the outlook for the future

This analysis provides a summary of the key findings

from a related survey conducted by SAP’s

Performance Benchmarking group

For more information and analysis, visit:

http://kw.wharton.upenn.edu/sap-innovation-value

https://valuemanagement.sap.com







https://valuemanagement.sap.com/


Survey Demographics

More Than 360 Participants Globally Responded to the Survey

13.2% 11.9%

9.7% 9.3% 8.4%

5.3% 4.0% 3.5% 3.1% 2.6% 2.6% 2.6% 2.2% 2.2% 2.2% 1.3% 1.3% 1.3% 1.3%

11.8%

Ban

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g

Pro

f.S

erv

ice

s

Hig

h T

ech

Oth

er

Se

rvic

es

Co

nsu

me

r P

rod

ucts

Hig

her

Ed

Aero

sp

ace

He

alth

care

Ch

em

icals

Auto

motive

Oil

and

Ga

s

Tele

com

Insura

nce

Pub

lic S

ecto

r

Utilit

ies

EC

&O

IM&

C

Lo

gis

tics

Med

ia

Oth

ers

< 1

%

Industry Mix (% of Respondents) N = 364

55%

9% 14%

22%

Less thanUSD 500

Million

500 Million to1 Billion

1 Billion to5 Billion

5 Billionand Higher

48%

36%

11% 5%

North America Asia-Pacific EMEA Latin America

Revenue (% of Respondents) Region (% of Respondents)

32%

18% 17% 13%

9% 6% 5%

IT Fin Ops Sales Service HR R&D

Line of Business (% of Respondents)

Source: SAP Performance Benchmarking (https://valuemanagement.sap.com)




Key Findings

believe cloud computing will

transform their business

and/or industry 85% see cloud computing as a

driver for innovation and

differentiation 47%

have “completely” or

“extensively” adopted

cloud solutions

run cloud solutions that meet

only “some” or “minimal”

business needs 37% using an integrated suite

of solutions say they meet

“most” or “all” needs

expect a major impact on

company performance

within five years 68%

have only “minimal” or even

“no” familiarity with cloud

topics 21%

expect cloud to amplify

and accelerate other

technology megatrends 65%

77%

18%


I. Why Cloud

Matters

II. Current

Adoption

III. Business

Impact

IV. Future

Impact



Outlook: Why Cloud Matters


The Cloud Will Transform Businesses

Key Takeaway: Almost all respondents believe cloud computing will have a major impact on their

organization, through new efficiencies, process innovation, or competitive differentiation

Q: “To what extent do you believe cloud computing can transform your organization or industry?”

Will be a competitive differentiator

20% Will lead to innovation in major

business processes

27%

Minor improvements

11%

Will lead to measurable efficiencies

38%

Not at All

4%


85% See cloud computing

impacting their

business/industry




3.4% 6.3%

25.2%

40.8%

24.3%

1 2 3 4 5

(1 = No Synergies, 5 = Significant Synergies)

The Cloud Will Accelerate Other Technology Megatrends

Key Takeaway: Even beyond the impact on IT infrastructure, cloud computing also is expected to fuel

innovations and trends in other new areas, such as mobility, analytics, and Big Data

Q: “To what degree do you believe cloud computing will amplify or accelerate other technology megatrends?”

65% See synergies between cloud

and other technology trends





The Cloud Will Create New Strategic Options

12.3% 11.5% 5.7%

65.6%

4.9%

Fast InitialImplementation

Fast/EasyUpgrade Cycles

FasterDevelopment

Times

Greater Flexibilityand Agility

Others

Key Takeaway: Businesses are investing in cloud computing in order to better respond to market

challenges and opportunities, and to pursue new sources of competitive advantage

Q: “Which cloud computing benefits do you see creating the most business advantage?”


66% Expect greater business

flexibility and agility



Adoption & Integration:

Current Perspectives


4.4%

16.5%

48.7%

26.9%

3.5%

Despite Cloud’s Potential, Understanding Is Mixed

Key Takeaway: While many respondents now consider themselves very familiar with cloud computing,

more than two-thirds do not feel that they have a good understanding of the topic

Q: “How familiar are you with cloud computing?”

30% Very familiar/experts

Minimal Awareness

Not Familiar

Some Understanding

Very Familiar

Expert


21% Minimal/not familiar




Many Have Not Yet Moved Onto the Cloud

Key Takeaway: Despite widespread agreement on the potential impact and benefits of cloud computing,

almost half of respondents say they still have minimal, or even no, adoption

Q: “To what degree have you adopted cloud solutions in your line of business or organization?”

Have extensively adopted the cloud

14%

Have some adoption of the cloud

35%

Not at All

22%

Minimal adoption

26%

Have completely adopted the cloud

4%


18% With extensive or

complete adoption

48% With minimal or

no adoption




Basic Applications and Point Solutions Are Most Common

Key Takeaway: While many companies have moved beyond basic applications, only 10% have reached full

integration of cloud solutions across their organization

Q: “What type of cloud solutions are you using today?”

Widespread point solutions, not

integrated

8%

Small-scale point solutions, not

integrated

26%

Not used

22%

Basic applications (email,

calendar, documents)

34%

Integrated suite of company-wide applications

10%


34% Point solutions




Security & Integration Remain the Biggest Concerns

Key Takeaway: Security remains by far the biggest concern for many companies, with issues around the

integration with other solutions and with existing IT landscapes next

67.0%

39.0%

38.0%

35.0%

32.0%

24.0%

21.0%

Security breaches & data losses

Cost of 3rd party integration

Difficulty integrating multiple point solutions

Mismatch with organizational requirements

Point solutions may not be supported long-term

Data 'silos' that may slow the enterprise

Other concerns


Q: “What are your main concerns with cloud computing?”



Business Impact:

Benefits & Value


Only 1-in-4 Have Cloud Solutions That Fully Meet Needs

Key Takeaway: Many organizations are not yet satisfied with the impact of their cloud solutions, with more

than 70% saying they are able to meet only some or a minimal set of business needs

Meets most business needs

22%

Meets some business needs

38%

Not at All

17%

Meets a minimal set

of business needs

20%

Meets all business needs

3%


37% Have cloud solutions that

meet minimal to no

business needs

25% Have cloud solutions

that meet most or all

business needs

Q: “To what degree do your cloud solutions meet your business needs?”




Those With the Highest Adoption See the Biggest Impact

66%

27%

9%

% reporting that cloud solutions

meet most or all their needs

Key Takeaway: The more extensively companies adopt cloud solutions, the more they say cloud solutions

effectively meet “most” or even “all” of their business needs

Level of Adoption

37%

2%

32%

13%

4%

23%

61%

28%

7%

26%

57%

2%

1%

9%

Minimal to NoAdoption

Some Adoption

Extensive orComplete Adoption

Not at All Meet a Minimal Set of Needs Meet Some Needs Meet Most Needs Meet All Needs


Business Impact




Those With Integrated Solutions See the Greatest Impact

Key Takeaway: More than two-thirds of companies that have put into place integrated companywide

solutions say cloud solutions are able to meet most or all business needs

5%

1%

35%

15%

3%

44%

55%

20%

14%

24%

70%

1%

5%

7%

Basic Solutions

Point Solutions

Integrated Solutions

Not at All Meet a Minimal Set of Needs Meet Some Needs Meet Most Needs Meet All Needs


77%

29%

15%

Type of Cloud Solutions Business Impact

% reporting that cloud solutions

meet most or all their needs



Future Impact:

Looking Ahead


Expectation I: Business Performance Will Be Redefined

Key Takeaway: Regardless of current adoption or current concerns, most respondents expect that the cloud

will have noticeable impact on their company’s performance within five years

Q: “To what degree do you believe cloud computing will change your company performance in the next five years?”

2.6%

29.2%

46.7%

21.5%

Marginal Impact

No Impact

Real Impact

Significant Impact


68% See a major change in

company performance

within 5 years




Expectation II: Cost Savings Will Kick in

10% 4%

35% 26%

Cheaper

Short Term

More Expensive

Short Term

Cheaper

Long Term

More Expensive

Long Term

(The remaining 25% say they don’t have a good understanding of the costs)

Key Takeaway: Most respondents expect cloud computing to be cheaper in the long-term;

yet one in four still say they do not have a good understanding of the business case

Q: “Do you believe cloud computing provides cost savings in the short term (i.e., license costs) and/or long term

(i.e., integration, maintenance, upgrades)?”


61% Expect long-term

cost savings




Expectation III: Integrated Solutions Will Increase Agility

Expecting Greater

Flexibility and Agility

Integrated Solutions 86% 30%

Point Solutions 76% 26%

Basic Solutions 59% 13%

Expecting Greater

Differentiation

Type of Cloud Solutions

Currently Used

Key Takeaway: Respondents who have adopted integrated company-wide cloud solutions have the highest

expectations for flexibility, agility and competitive differentiation




Thank you

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