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Cloud Boom Time in CEE Market
IDC FutureScape: Worldwide Cloud 2016 Predictions – Implications for CEE lists top 10 cloud-related issues and shows how regional circumstances are impacted by global trends. This FutureScape study provides both IT and business implications of a given prediction, as well as guidelines for IT vendors and buyers.
Regional trends in Central and Eastern Europe (CEE) are largely in line worldwide predictions, although the timing may vary as to when individual predictions actually become mainstream.
Although cloud adoption among companies in CEE slightly lags behind the more mature markets of Western Europe (WE) or the U.S., cloud will be considered as an alternative delivery model to traditional IT by entities in all sectors. The adoption of various forms of cloud will continue to grow; currently, the majority of end-user organizations are either actively utilizing cloud, in the process of deploying it, planning to deploy it, or evaluating its deployment. The increasing roles of line-of-business (LoB) stakeholders, online channels, and direct customer relationships are contributing to increasing cloud penetration. CEE organizations will post lower rates of uptake for several reasons, including: 1) the lower maturity level of CEE markets; 2) a somewhat conservative approach to new technologies; and 3) current technology investments that are still not generating the desired returns on investment.
As IDC does not expect many CEE users to opt for a “cloud first” model, a “cloud also” approach will be the most common. Nevertheless, cloud will become a genuine alternative to traditional IT purchases and hybrid IT will become the dominant IT model for many organizations. More than 50% of enterprise IT departments will commit to hybrid cloud architectures by 2018, vastly driving the rate and pace of change in IT departments. Hybrid cloud is a logical choice in terms of gaining optimal functionality from the myriad of cloud systems and on-premises resources, but successful implementation rests on seamless integration. At the same time, as business users have become more tech-savvy, often adopting their at-home habits in the workplace, they feel comfortable making IT-related decisions and may consequently bypass their IT departments when their demands are not being met. Therefore, in a hybrid environment, IT needs to transform and put a greater emphasis on meeting the needs of LoB.
It needs to be stressed that commitment to cloud solutions does not imply the release of responsibility for IT management within the end-user organization. On the contrary, internal IT will need to attract and retain qualified personnel responsible for ensuring adherence to corporate IT governance. By 2018, IDC predicts that CEE organizations will spend up to 10% of their total IT budget on cloud services delivered by third-party providers. Competition for cloud experts will grow among both IT providers and IT business users both locally and globally. Filling cloud-related skills gaps will require additional time and effort from HR departments, which will increasingly need to balance internal resources with third-party expertise.
Like the rest of the world, the CEE region will see the dynamic development of industry clouds. By 2018, industry cloud creation will be a top market-entry strategy for IT providers and industrial firms, as IT and industry domain experts team up to remove barriers to entry (costs of access to certain customer groups, necessary platform build out, etc). Industry cloud represents both an opportunity and a risk for traditional IT staff. The focus is no longer on general IT support and managing data, but rather on discovering and unlocking the value within it. IDC believes that, like their U.S. or WE peers, LoBs in CEE organizations are becoming increasingly independent on internal IT, and industry clouds are one of the enablers of this trend.
LoBs’ engagement in technology deployments will be reflected in IT project management methodologies shifting from traditional to more agile and cloud-based environments. IDC notes that DevOps matures and changes the way applications are developed and maintained. By 2018, over 50% of new apps developed in CEE will use cloud delivery and cloud native application architectures, thus enabling faster innovation and business agility. This approach nurtures cross-departmental collaboration and encourages both developers and users to be more responsible and engage more closely with the solutions they develop together. One of the most often stressed advantages of DevOps is that ongoing testing and development processes enable potential problems to be spotted earlier, a key feature in an era when user dissatisfaction can result in an immediate shift to a competing app. At the same time, there is a much greater demand for flexibility in the product development process — something that not all companies are prepared to allow, as they often prefer to stick with traditional project methodologies.
"As one of the cornerstones of digital transformation, cloud technology is affecting various organizational areas and is an essential enabler for other 3rd Platform technologies such as big data/analytics, mobility, social media, and IoT. The adoption of various forms of cloud will continue to grow; the majority of end-user organizations are actively utilizing cloud, in the process of deploying it, planning to deploy it, or evaluating its deployment. Nevertheless, more traditional IT solutions will not disappear entirely in CEE, as organizations remain reluctant to make a full cloud transition. Forward-looking end-user organizations will incorporate various forms of cloud delivery into their operational management." — Associate Vice President Vladimir Kroa, IT and Cloud Services, IDC CEMA
Cloud platforms lie at the very bottom of the Third Platform initiatives, or even more, form the basis for digital transformation many companies hold high on their priorities lists. Today’s business calls for quickness, flexibility, responsiveness and understanding of clients’ needs and cloud is here to encourage, implement and support that.
To learn all the predictions and their implications, please see IDC FutureScape: Worldwide Cloud 2016 Predictions — Implications for CEE. Within the next few months, IDC will publish country-level reports that will cover the listed predictions with more local detail to provide an even more precise picture of cloud development.
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