TCO Main Driver For Cloud Adoption

A new report from Hubspan has highlighted that the increasing uptake of Cloud computing is changing how companies implement new solutions.

So said the provider of cloud-based business integration solutions, as it made its top predictions for 2012 in cloud computing, business integration and enterprise adoption based on insights from IT industry analysts and enterprise customers.

Consumerisation Trend

The report noted that in the past decade the consumerisation of IT has continued to spread across numerous sectors of the industry, from PCs and email to hosting services. “As this trend makes its way to the cloud, customers will have greater expectations around real-time visibility into the supply chain and achieving a lower TCO [total cost of ownership] through deploying cloud-based integration solutions,” the report said. “Hubspan believes these changes will drive a disruptive shift for IT over the next year.”

Enterprise Resource Planning (ERP) systems will focus on delivering integration networks targeting vertical industries, the report predicted, as an ongoing effort to improve collaboration and process automation, will drive on-premise and cloud-based ERP and CRM vendors to look to the cloud to build their network communities as a way to extend their end-to-end business processes as well as deliver incremental value to customers.

The report warned that economic uncertainty would prevail and drive companies to get even closer to existing customers, and Hubspan predicts that companies will focus on maximising their relationships with existing customers and partners as a significant contributor to top-line financial performance.

“We will see greater focus on solving customer needs, adapting solutions to fit their requirements and providing new ways to deliver value without forcing them to change the way they currently do business,” the report said. “Companies are flagging these areas of opportunity by finding ways to leverage existing customer infrastructures with minimal incremental investments.”

Social Trend

With nearly two-thirds of American adult Internet users participating in social networks, according to a survey by the Pew Internet & American Life Project, expectations for how businesses connect and communicate have evolved. People are accustomed to constant communication in both their personal and professional lives and will often modify old ERP systems with user-friendly tablet and phone applications.

Hubspan predicts that companies will need to transition their interactions with customers from a handshake to a conversation, to follow the changing expectations of society.

In order to do this, companies will use real-time commerce technologies to reach not just the customer, but the end user as well.

Cloud Drivers

Hubspan also predicted TCO would continue to be the primary driver of cloud adoption due to scalable costs and consumption models offered by cloud vendors that simply cannot be matched by on-premise solutions.

A close-second driver of adoption will be the need to squeeze costs out of critical business processes through automation and integration throughout the extended enterprise.

As cloud computing continues to evolve and security standards are established, Hubspan predicts that during the next year enterprises will see the cloud as a viable option to run business-critical systems.