As organizations continue to migrate to the cloud, some companies are benefiting more than others, according to management consultancy PwC’s 2023 Cloud Business Survey.
The report found that 78% of business leaders surveyed by PwC said the cloud had been adopted in most or all aspects of their business. However, simply adopting the cloud is not enough for an organization to be what PwC calls a “cloud-powered” business. Only 10% of organizations surveyed by PwC fall into the category of cloud-based companies. So-called cloud-based enterprises enjoyed more benefits, including improved decision-making, productivity, cyber posture, and cost savings.
PwC research found that there are four main characteristics that define a cloud-based organization:
- Holistic and unwavering approach to the cloud
- C-suite collaboration from the start
- Formal data, analytics and AI strategy
- Focus on trust and controls
“Cloud-powered organizations are those that reinvent their business through the cloud, face fewer barriers to achieving value, and expect 15% or more revenue growth 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 report’s findings is an analysis of how cloud-based enterprises are able to improve cost management and cloud resource optimization (sometimes referred to as FinOps) better than others.
Related: Beyond scaling: when it comes to optimizing cloud costs, think big
Phaneuf said the report found that over 30% of cloud spending is wasted. In contrast, cloud-based businesses have instant access to performance data and use purpose-built tools to continuously optimize their performance, spend, and resource utilization.
The survey also revealed that cloud-based companies approach transformation as a team sport, and this team approach makes it much easier to find and optimize cloud resources, she said.
“IT is no longer looking for parallel spending, but the entire organization is incentivized to manage the cloud more efficiently,” Phaneuf said. “Finally, cloud-based companies are usually able to offer chargeback services upfront, whereas most companies only offer chargeback at best, leaving their business users wondering where their spending is going. “
The challenges of becoming a cloud-based organization
For organizations looking to become cloud-powered, there are a few challenges.
“The biggest hurdle non-cloud-powered businesses face is uniting their leadership behind the cloud,” Phaneuf said.
Related: How the Cloud Made Computing Harder, Not Easier
She noted that every executive typically has multiple reasons for not being able to fully adopt the cloud, and that’s hard to overcome, especially when those reasons relate to risk or loss of control. In these non-cloud-powered companies, fractured leaders are also adopting fragmented approaches to data, which Phaneuf said PwC sees as a major obstacle to the cloud. PwC’s survey found that nearly 90% of cloud-based 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 advantages to being partially cloud-powered, including:
- better controls
- better visibility into costs, performance and resources
- more leadership alignment
Looking ahead, Phaneuf said PwC expects more companies to be cloud-powered in the coming years and will drive this transformation through the adoption of industry and sector specific clouds.
“Finally, if economic uncertainty continues to rise, we expect companies to double down on cloud investments to drive their technology investments forward,” she said.
About the Author
Sean Michael Kerner is an IT consultant, tech enthusiast, and handyman. He consults for industry and media organizations on technology issues.