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Concerns Persist Over Cloud Model Amid Bad Experiences Reveals SunGard Availability Services Research

Key findings:

  • 68% of UK CIOs only happy to outsource data which is not critical or sensitive
  • Only 10% of CIOs ‘completely confident’ in security and resilience of third party cloud solutions
  • 66% of UK CIOs had already experienced some downtime from apps hosted in the cloud
  • 42% of CIOs say that their CFO colleagues have shown opposition or concerns about moving to the cloud
  • Accounting, HR and payment systems least likely to be moved to the cloud

Research sponsored by SunGard Availability Services, the pioneer and leading provider of Information Availability and business continuity services shows that despite fast adoption rates, only one in ten UK CIOs feel ‘completely confident’ in the security and resilience of third party cloud solutions. The research, conducted by Vanson Bourne among 250 UK CIOs, also reveals that a majority (68%) are only happy to move to the cloud data which is not deemed critical or sensitive.

Asked to name the types of application and data they would be least willing to move to the cloud, CIOs cited those involved in accounting, HR and payroll, all three of which would commonly include financially sensitive information.

The research also highlights how early bad experiences with the cloud may have contributed to concerns over the resilience and availability levels of some third party cloud providers, with 66% of UK CIOs saying they had already experienced some downtime from apps hosted in the cloud.

The fast rate at which cloud services have been adopted was also revealed, with 84% of CIOs surveyed having already moved some applications to the cloud and 82% having already moved some of their infrastructure into the cloud. 43% of those surveyed also said they had plans to move at least half of their IT infrastructure to the cloud in the next 12 months.

The research also highlighted some real areas of disparity in board attitudes to the cloud with CFOs generally more wary of the cloud than their CIO colleagues. CIOs were found to be more comfortable in outsourcing data than their CFO colleagues, with 14% of CIOs saying they were not comfortable outsourcing any data compared to 23% of CFOs. Furthermore, 42% of CIOs say that their CFOs have shown opposition or concerns about moving to the cloud.

“It is clear from this research that while cloud adoption continues apace, CIOs are holding back from committing their most sensitive and important data to third party cloud providers,” commented Keith Tilley, managing director UK and executive vice president Europe for SunGard Availability Services. “While the newer breed of cloud providers has focused on selling the benefits of cloud, of which there are clearly many, organisations are right to be asking the crucial questions about the security and availability of their data and infrastructure before they entrust it to a third party. Demonstrating a reputation for having security, resilience and availability baked in to solutions will be key to imbuing CIOs with the confidence to continue to move their more critical infrastructure and applications to the cloud.”

Tilley concluded, “We absolutely understand that not all of an organisation’s data or infrastructure can or should be moved to the cloud, and that what works for one organisation may not work for another. The vast majority of CIOs we speak with are looking for a ‘hybrid’ approach to cloud, where they want providers to manage both their enterprise-class private cloud and their traditional applications and infrastructure.”

Steve Wallage, managing director, BroadGroup Consulting added, “The BroadGroup experience is also that while cloud can make a lot of sense, the move is very much evolutionary rather than revolutionary. Corporates want to be convinced every step of the way and naturally have some key concerns around security, performance and overall cost, not least from the CFO’s perspective. Our research also shows the change is as much about cultural and internal thinking as technology. The notion of IT as a service provider and employees as customers is not easy when IT has often previously been seen as a very distinct and somewhat mysterious area. Cloud providers who will win out need to show they truly understand the concerns of enterprises, and can partner with them in maximising the immense opportunities of cloud services and thinking.”   

“You need to be very clear about what benefits you are getting by running your infrastructure in the cloud,” says Richard McGrail, Partner and Head of IS, Baillie Gifford & Co. “If it is critical infrastructure you need to know the service provider and trust them like they are part of your team. Technology is complex and problems can happen to anyone – operational and security related. So if you are going to put sensitive company information, or mission critical business processes under someone else’s management you need to know them, their IT operation and their future strategy very well.”

The white paper, ’Cloud – Challenges and Opportunities for the C-Suite’, based upon the research findings may be obtained here.

IT spending surveyWe promised to bring you the full findings of our IT survey of 100 chief financial officers (CFOs) in mid-sized UK headquartered firms conducted by Vanson Bourn on behalf of SunGard Availability Services.

Two thirds (66%) of those responsible for financing it expenditure admitted to not fully understanding the benefits of moving to cloud computing, although this is recognised as being a key technology to reduce  it spend. This is particularly concerning as almost  two thirds (62%) of CFOs expect their it budgets to remain static over the next three years.

More than half (56%) of those polled said they are deterred from outsourcing the management of their it infrastructure by the perceived security risks. The research showed that these fears are exacerbated by high profile media stories about third party it outages or data losses with nearly half of respondents (45%) confessing that such cases make them more inclined to keep their data in-house, despite the cost implications.

While almost half (45%) of CFOs said they aspire to remove data centres from the balance sheet, almost two thirds (60%) had concerns over loss of control in handing data over to a third party. This concern could be attributed, at least in part, to a lack of understanding as less than a third (28%) said they knew the distinction between private and public clouds, which as you will know, differ radically in terms of security and resilience!

Interestingly, the survey highlighted a marked difference in attitudes between home and work use of the cloud. More than two thirds (67%) of CFOs have eagerly embraced cloud-based apps such as Hotmail, GoogleMail and Spotify for their personal use, while  just over a quarter (26%) currently use corporate applications in the cloud.

A solid record and history of resilience in protecting customers’ data was rated the most important attribute in a third party provider by 49% of respondents, followed by a well-known brand name (35%) and impressive ROI statistics cited by just 16%.

The findings suggest that organisations are looking for a solution that offers all the benefits of the cloud – such as cost savings and increased agility – but where data and applications are stored in a fully resilient and secure data centre that allows firms complete control. As this is exactly what a private cloud offers, it is clear that  those with it responsibility probably need to do more to educate financial decision-makers about the benefits of moving to the right cloud environment.