As organizations continue to move to the cloud, some companies are benefiting more than others, according to management consulting firm PwC's 2023 Cloud Business Survey.
The report found that 78% of corporate leaders surveyed by PwC stated that cloud has been adopted in most or all aspects of their business. Simply adopting cloud, however, is not enough for an organization to be what PwC refers to as a "cloud-powered" company. Only 10% of organizations surveyed by PwC fit into the cloud-powered category. The so-called cloud-powered companies have experienced more benefits, including improved decision-making, productivity, cyber posture, and cost savings.
PwC's research found that there are four primary characteristics that define a cloud-powered organization:
- Holistic and unwavering approach to cloud
- C-suite collaboration from the get-go
- Formal data, analytics, and AI strategy
- Focus on trust and controls
"Cloud-powered organizations are those that are reinventing their business through cloud, experiencing fewer barriers to reach its value, and expect revenue growth of 15% or greater despite the current business environment," Danielle Phaneuf, partner, Cloud & Digital Strategy at PwC, told ITPro Today.
PwC 2023 Cloud Business Survey Details Cost Management Techniques
Among the findings in the report is an analysis of how cloud-powered companies are able to improve cost management and optimization of cloud resources (sometimes referred to as FinOps) better than others.
Related: Beyond Rightsizing: When It Comes to Cloud Cost Optimization, Think Big
Phaneuf said the report found that over 30% of cloud spend is wasted. In contrast, cloud-powered companies have instant access to performance data, and they are using tools that are specifically designed to continuously optimize their performance, spend, and utilization of resources.
The survey also revealed that cloud-powered companies approach transformation as a team sport, and this teaming approach makes finding and optimizing cloud resources a much easier task, she said.
"No longer is IT looking for shadow spending, but the whole organization is incentivized to manage the cloud more efficiently," Phaneuf said. "Finally, cloud-powered companies are typically able to offer chargeback services from the start, whereas most companies are only offering showback at best, leaving their business users wondering where their spend is going."
Challenges on the Path to Being a Cloud-Powered Organization
For organizations looking to become cloud-powered, there are a few challenges.
"The biggest barrier non-cloud-powered companies face is uniting their leadership behind the cloud," Phaneuf said.
Related: How the Cloud Made Computing Harder, Not Easier
She noted that each leader typically has multiple reasons for not being able to fully embrace the cloud, and this is hard to overcome, especially when these reasons have to do with risk or loss of control. In these non-cloud-powered companies, fractured leaders also take fragmented approaches to data, which Phaneuf said PwC sees as a major barrier to the cloud. The PwC survey found that close to 90% of cloud-powered companies have an enterprise data strategy.
While the ideal scenario is for an organization to be fully cloud-powered, Phaneuf said there are still many benefits to being partially cloud-powered, including:
- better controls
- improved visibility into cost, performance, and resources
- more leadership alignment
Looking forward, Phaneuf said PwC expects that more businesses will be cloud-powered in coming years and they will be driving this transformation through the adoption of industry- and sector-specific clouds.
"Finally, if economic uncertainty continues to increase, we expect companies will double down on their cloud investments as a way to make their technology investments go further," she said.
About the author
Sean Michael Kerner is an IT consultant, technology enthusiast and tinkerer. He consults to industry and media organizations on technology issues.
