trust in cloud technology

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Trust in cloud technology and business performanceReaping benefits from the cloud

A report from The Economist Intelligence Unit

© The Economist Intelligence Unit Limited 20161

Trust in cloud technology and business performance: Reaping benefits from the cloud

Preface 2

e findings 3

ntroduction 4

rust in the cloud correlates ith better performance results 6

igher trust le els correlate ith organisational transformation 9

rust does not emerge organicall o to build it 11

onclusion 14

ppendi ur e results 15

Contents



Trust in cloud technology and business

performance is an conomist ntelligence nit

report sponsored b oogle that

e plores lin s bet een cloud use cloud trust

and organisational performance t offers

insights to e ecuti es na igating the e ol ing

and nebulous orld of the cloud as it gro s in

scope and scale

or this report a ten countr multi industr

sur e of senior e ecuti es and

inter ie s ith e perts assess ho far along

organisations across the orld are on the

cloud progression and trust cur e ith the

goal of better understanding the role of trust

in the conte t of rapid cloud adoption

n a separate series of uestions the sur e

also measures ho respondents organisations

fare is is their peers on arious financial

and non financial performance metrics

ranging from profit for pri ate sector firms to

inno ation to sectoral leadership for all

he findings and ie s in this report do not

necessaril represent the ie s of the sponsor

he author as aul ielstra arol n helan

as the editor and na erenguer as the

anal st

Interviewees

he report includes insights from a global

cohort of cloud e perts e ould li e to

than all the indi iduals ho participated

● r aid abet co chair loud rust or ing

roup loud ecurit lliance

● r orbert lein ohann chief information

officer iemens

● uilherme ru chief information officer

ilson ons roup

Preface



● loud based technolog alread ma es up

a si eable portion of corporate and

go ernment s stems ith of enterprise

currentl based on this technolog this

figure ill li el gro to b

● rust in cloud technolog ho e er hile

also gro ing remains muted ith onl

of sur e respondents indicating er high

trust in the cloud

● his disconnect has important implications

Respondents ho sa their organisation has

higher trust in the cloud also report much

better outcomes on both non financial and

financial success metrics including

re enue profit and share price gro th

than do their peers ho indicate lo er

trust or e ample those ith er high trust

in cloud technolog o erall cite a

profit rise ersus b the lo trust group

● n contrast cloud use alone independent

of trust does not appear to produce these

benefits to nearl the same e tent in some

cases sur e data re eal no statisticall

significant connection bet een usage and

better outcomes

● he relationship bet een trust in cloud

technolog and positi e business outcomes

at high trust organisations appears to be

lin ed to their illingness to foster business

transformations that le erage hat the

cloud offers ut simpl higher cloud trust

appears to facilitate beha ioural and

process change ithin an organisation

● uccessfull de eloping trust appears to

build on the acti e leadership of senior

e ecuti es supporting emplo ees and

functions to do their obs through the cloud

and encouraging them to e periment ith

cloud use to change ho an organisation

operates in a s large and small

e findings

his pril stud is based on a global sur e of senior

e ecuti es from a ide range of functions conducted b

he conomist ntelligence nit and sponsored b oogle

Respondents are e enl distributed across ten de eloped

and de eloping countries ustralia ra il rance

erman ndia apan the etherlands e ealand

the and the he sur e sample is also senior ith

half of those polled in le el positions and the balance

heads of department or abo e he organisations here

the or span a range of si es ith roughl each

emplo ing to to and or more staff

Respondents hail from e uall di erse industries including

communications consumer goods ser ices entertainment

financial ser ices healthcare insurance manufacturing

chemicals media professional ser ices public sector

go ernment retail technolog and telecommunications

Results ere tested for statistical significance at a

confidence le el

About the survey



he cloud s idespread but ar adoption

he cloud s spread through s stems has

been impressi el rapid e en in a orld

inured to the accelerating speed of ne

technolog adoption t is difficult to pinpoint

e actl hen a ne technolog appears but

cloud ser ices sufficientl robust for corporate

use are less than ears old s late as

a global State of the Cloud Survey found that

cloud h pe far out eighed a significant

presence ith fe er than of

organisations full implementing ma or cloud

ser ices at that time 1

ust fi e ears later some cloud use at

organisations is all but uni ersal n the sur e

conducted for this stud of respondents

report use of at least some cloud ser ices his

is consistent ith other recent polls 2 n

business isps of cloud are no e er here

he sur e also sho s that the cloud s

role ithin enterprise is no substantial

oda about of at respondents

mantec 2011 State of the Cloud Survey

ee Right cale Cloud Computing Trends: 2016 State of the Cloud

Survey

organisations is cloud based hose polled

foresee further rapid gro th to b

loud technolog then is a core and

gro ing component of modern s r aid

abet co chair of the loud rust or ing

roup and editor of the loud ecurit

ocument ro ect at industr organisation

loud ecurit lliance puts it hings are

e ol ing rapidl he cloud is almost mature

he idespread impact of the adoption of

cloud technolog is also clear he cloud has

alread helped transform se eral e

desirable attributes at a ma orit of

organisations see chart

oreo er cloud reliabilit is per asi e in

matters of due diligence of those

sur e ed report that the reliabilit of potential

suppliers cloud based has in uenced

purchasing decisions sa this same

consideration has affected partnership

decisions ith other organisations

o e er hile the use and impact of the

Source: Economist Intelligence Unit, 2016.

Complete Somewhat

0 10 20 30 40 50 60 70 80

Overall profitability (Return on investment)

Collaboration

Time to market

Use of experimentation

Level of agility

Business model

Degree of transformation from the cloud(% respondents)

ntroduction

e els of cloud trust are lo toda ust of respondents sa their organisation has a er high le el of trust in the cloud o erall



cloud ha e spread remar abl uic l broad

trust in the technolog as a hole3 is less

common lthough ust o er half of

respondents note some increase in

o erall cloud trust in the past three ears ust

report a great rise in confidence in the

cloud otabl almost as man cite a decline

in trust inall the current le el of trust is

lo oda ust of respondents sa their

organisation has a er high le el of trust in

the cloud o erall hirt fi e percent call it

some hat high moderate and lo

hese numbers might simpl be considered

note orth if une pected in light of the

recent uptic in cloud adoption Respondents

ho e er belie e that concern about the

cloud is e cessi e ith sa ing that

current le els of trust are belo hat cloud

technolog merits

r abet also points to a disconnect

bet een cloud trust and usage hen cloud

computing started to gather momentum

technolog companies had an opportunit to

pro ide education he sa s he did not do

that hings ha e been mo ing fast and that

he sur e in uired about current and changing le els of trust in the cloud o erall and in its abilit to pro ide or protect securit pri ac ser ice reliabilit data accessibilit scalabilit pro ider support cost targets and greater agilit s figures for each of these separate attributes in e er case closel mirror the o erall results for clarit and bre it this report focuses on figures for o erall trust

has created some misunderstanding

ut since cloud adoption has been so

rapid is this undul lo le el of trust

important ther studies on the effects of trust

suggest it might be so large bod of

research dating bac decades sho s the

mar ed importance of trust both specificall

and as an element of social capital for

economic de elopment and gro th s one

earl author in this field enneth rro rote

er commercial transaction has ithin itself

an element of trust 4 nside organisations

research sho s that trust bet een those at

different le els of seniorit is also a e

predictor of business outcomes mplo ees

perform better hen the both trust corporate

leadership and hen the feel that those

e ecuti es trust them 5

o e plore hat if an thing ma be at

sta e this stud e amines the degree to

hich trust in cloud technolog matters at an

organisational le el ho trust might affect

organisations and from here such trust

arises

ifts and changes Philosophy and Public Affairs

arah ro n et al mplo ee rust and or place erformance nstitute for the tud of abour or ing aper

abrine alamon and andra Robinson rust that binds the impact of collecti e felt trust on organi ational performance Journal of Applied Psychology


● Very high

● Somewhat high

● Moderate

● Somewhat low

● Very low

● Increased greatly

● Increased somewhat

● No change

● Decreased

Use is everywhere but high trust less widespread: How high is trust in the cloud overall among your organisation's executives?(% respondents)

Cloud trust's slow growth: How has trust in the cloud overall changed among your organisation's executives in the last 3 years?(% respondents)

16 15

3733

13

3529

126

S er commercial transaction has ithin itself an element of trust T

enneth rro ifts and changes

Philosophy and Public

Affairs



mong the sur e s most surprising findings

are the difficulties in identif ing lin s bet een

greater cloud on its o n and higher

performance in a range of business metrics

or the purposes of this stud e place the

self reported e tent of cloud use at

respondents organisations into three buc ets

substantial users those ith more than

of their cloud based moderate users

and those ith or under in the

cloud light users

impl put for some metrics co ered in the

sur e including re enue and profit there is

no statisticall significant difference bet een

these groups here are ho e er differences

bet een substantial and light users hen it

comes to benchmar ing their organisations

ell abo e a erage for the financial

performance efficienc of their organisations

for impro ement in their abilit to inno ate

and for sectoral leadership his does not

pro e a lac of benefits from cloud use alone

but it does suggest that an gains that ma

occur are too ea to identif abo e

bac ground statistical noise

his does not surprise r orbert

lein ohann chief information officer at

iemens a erman based global

engineering compan e notes that the most

important gains from cloud technolog at his

compan are not the har esting of the

lo hanging if still aluable fruit of the cost

sa ings associated ith cloud use he deeper

benefits arise from a change of mindset he

obser es

oes cloud trust matter n this conte t and

rust in the cloud correlates ith better performance results


Very high trust Somewhat high trust Moderate trust Somewhat/Very low trust

3 = No change

4

5 = Much improved

Trust’s non-financial dividends: Changes in performance among organisations with different levels of overall trust in the cloud over the last year (% respondents. Mean change since the previous year against trust in use of the cloud overall; 5 = Much improved, 3 = No change, 1 = Much worse)

Agility Riskmanagement

Ability toinnovate

Intra-organisation collaboration

Reputation Sectorleadership

eeper cloud benefits arise Sfrom a change of mind setT

r orbert lein ohann chief information officer iemens



based on additional sur e findings it appears

so impl put higher le els of trust ha e a

statisticall significant substantial and positi e

correlation ith a ide range of business

outcomes

his lin is clearl isible for corporate

attributes and capabilities such as an

organisation s leadership position hose

sur e ed ran ho se eral of these attributes

and capabilities had changed in the prior

ear s the chart belo sho s e ecuti es

ho report lo o erall le els of trust in the

cloud at their organisations note close to no

change represented b a score of in an

of the areas co ered o e er as trust

increases so too does self reported

impro ement in these areas oreo er

respondents reporting the highest le els of

trust are rapidl pulling ahead of the pac on

these criteria

hen it comes to the bottom line

differences are star er t the e tremes those

ho sa their organisation has er high cloud

trust report a a erage rise in profits o er

the last ear ersus the impro ement

noted b their lo trust peers

ome of this is predictable s r abet puts

it ac of trust is often about dealing ith the

un no n f ou don t understand hat is in

front of ou and its capabilities ou on t trust

it and b e tension its effecti e use ill

suffer ut another a if users don t trust the

cloud because the don t understand it that

same lac of understanding ill hamper its full

effecti e use

ut e perience appears to be onl part of

the e uation f familiarit ith the technolog

ere the sole factor its increase o er time

ould simpl erase differences in trust and its

attendant ar ing business outcomes

gain sur e findings suggest that trust

does not de elop organicall mong

respondents the lin bet een the e tent of

cloud usage and trust is surprisingl

inconclusi e et een the hea iest and the

er lightest users there are fe statisticall

discernible lin s bet een cloud use and some

trust le els including o erall trust in the cloud

lse here there are none

r lein ohann s or in initiating

idespread cloud use at iemens helps

e plain this apparent disconnect e notes

that the biggest barriers to adoption tend to

be emotional trust in particular eople thin


Very high trust Somewhat high trust Moderate trust Somewhat/Very low trust

-2

0

2

4

6

8

10

Improvements over the last year in key economic metrics among groups with different levels of overall trust in cloud technology(%)

Revenue Profit Share Price

S ac of trust is often about dealing ith the un no n f ou don t understand

hat is in front of ou and its capabilities ou on t trust

it Tr aid abet co chair loud rust or ing roup loud ecurit lliance



rust in cloud technolog is strongl lin ed

ith positi e business outcomes

that if something is more in our hand it is

more secure he obser es hus for man

opting for a cloud based solution is not an

ob ious efficient choice ostering the

necessar trust is a tric longer term

challenge than simpl introducing ne

technolog alone he adds

rust in cloud technolog then is strongl

lin ed ith positi e business outcomes et

usage alone is not tied strongl to such

outcomes nor on its o n does it ine itabl

generate trust his prompts t o uestions o

does trust boost organisational use of the cloud

and ho can organisations build trust

trust in cloud technology

Technology