Why data-centric organisations need a robust cloud strategy

Data is the strategic currency of the digital age. Enterprise adoption of cloud requires an organisation wide cloud strategy.

In brief

• Cloud is a disruptive and competitive enabling technology which requires all organisations to have a robust cloud strategy to ensure effective adoption.
• There are many drivers of cloud adoption for Irish organisations including flexibility to meet changing business requirements, cyber resiliency, and sustainability requirements.
• Successful cloud adoption requires a strategy which is updated regularly based on a short feedback loop.

Acloud strategy is no longer an option for Irish organisations, it is an imperative. Such is the power of the technology as a competitive enabler that organisations without a robust cloud strategy risk not being in business at all within the next few years. Market disruptions have become more frequent and impactful. To keep pace, organisations have begun to transform more frequently.

In this context, the fact that cloud technology was ranked as the top area for technology investment over the next two years by Irish respondents to the EY Ireland Tech Horizon 2022 survey is very welcome. Cloud is a foundational technology layer for data-centric organisations. Many Irish organisations have already completed an initial cloud adoption, yet the most significant and challenging enterprise wide adoption has yet to be accomplished. It has been in the top two priorities in the 2020 and 2022 Tech Horizon surveys.¹

Rapid changes in technology have been partly responsible for this. For example, software vendors are not prioritising on-premise software anymore. They have moved to a per user consumption model with software as a service (SaaS) offerings. It’s not a case of when, it’s already happening. That train has left the station and Irish organisations not on it will be left behind. Consuming SaaS services requires significant planning and operational changes for organisations. This change will also extend to a mindset shift for organisations and employees to accommodate the alternative cost models cloud adoption brings. Depreciation and multi-year ROI are fast becoming a thing of the past. Quickly adapting to this is a crucial early step on the cloud journey.

Irish organisations also need to become more data centric to fulfil regulatory obligations and meet increasing customer expectations. However, the sheer scale and volume of the data collected today creates quite serious challenges to their ability to become data centric.

Flexibility to meet changing business requirements

Public cloud services can scale almost infinitely to match growth in data volumes. They also offer the platform and tools to collect and collate data from different sources efficiently and effectively. This provides the technological foundation to become data centric. The benefits of data centricity and modern cloud platforms were highlighted by the response to the COVID-19 pandemic. Platforms were built in the cloud to gather data from multiple sources and produce daily case numbers which were updated in real time. These platforms were built within weeks despite the considerable challenges involved. The nature of the cloud services utilised permit these platforms to scale down as the pandemic recedes, ensuring the most efficient use of resources.

At another level, the cloud is critical to the implementation of concepts such as Industry 4.0. Smart factories rely on Internet of Things (IoT) technology which, in turn, are dependent on the cloud to function efficiently. Concepts such as smart cities cannot materialise without the cloud platforms to collect and process vast amounts of data from disparate sources.

Building cyber resiliency

Cybersecurity has been another key driver of cloud adoption for many Irish organisations. Recent ransomware attacks have highlighted the significant cyber risk faced by all organisations. Taking an “assumed breach” and “zero trust networks” approach is required to combat the threat. 

To date, there has been reticence among some Irish organisations to store sensitive data in the cloud. Recent events have caused a shift in that thinking and a realisation that any data can be stored in the cloud once it is sufficiently protected and secured.

Cloud-supplied security offerings can provide a cost-effective solution with lower cost of entry for Irish organisations. Cloud can be superior when it comes to cyber risk mitigation².  Irish organisation’s cloud strategies and policies need to be modified and constantly reviewed to ensure alignment with the latest cyber protection approaches.

Driving sustainability

Modern cloud platforms have a role to play in meeting sustainability targets. Most Irish organisations have a carbon reduction target and achieving it will be a primary business objective in the coming years. Irish organisations running their own data centre and on-premise infrastructure have quite a large carbon footprint. Modern cloud platforms can provide more efficient use of resources. The major cloud platform vendors have committed to running their data centres on renewal energy by the end of 2025. Utilising these platforms will deliver an immediate carbon reduction benefit to Irish organisations.

In addition, for sustainability initiatives to be successful there is a need for data to monitor and measure them. In the coming years, Irish organisations will have to produce verifiable Environmental, Social and Governance (ESG) data in line with upcoming regulations. Customers are demanding decarbonisation within their supply chains and supplier ecosystems. Collecting, managing, and analysing that data will require a cloud hosted, modern data platform.

On the consumer side, Irish end users require human-centric data to enable them to calculate their own individual carbon footprints. For example, smart electricity meters currently provide some of that data. Sustainability aware Irish end users will demand data related to the other products and services they consume in as near real time as possible. To provide this, organisations will require a cloud hosted, modern data platform.

Coherent organisation wide cloud strategy

For these reasons and more, every Irish organisation needs to have a coherent cloud strategy in place which brings together people, processes and technology in a way that will help it achieve its business and other objectives.

Cloud strategies need to be dynamic and subject to ongoing change. After all, technology, people and processes change regularly. The external environment is evolving rapidly as well and in the last year alone organisations have had to contend with a continuing global pandemic, the Ukraine war, rapidly rising inflation, a potential energy crisis and more. It is clear, therefore, that a cloud strategy cannot be put in place for five years and revisited at that point. It needs to be subject to constant and robust review with a short user feedback loop.

The cloud strategy also needs to be based on the needs of the whole organisation, not just individual divisions or departments. Up until now, a lot of cloud adoption has been a point solution rather than being adopted strategically across the organisation, with services being initiated on a case-by-case basis. This approach leads to duplication and lacks the level of coordination required for an enterprise level, organisation wide adoption of cloud services.

All elements of the business – HR, sales, marketing, production, finance, procurement – need to be involved in the development of the strategy. The organisation must ask itself:

Each organisation’s cloud strategy is bespoke. Every organisation is different and needs to plot its own cloud journey.