May 26, 2010
Cloud ROI: Calculating Costs, Benefits, Returns
Think that sneaking feeling of irrelevance is just your imagination? Maybe, maybe not. Our April 2010 InformationWeek Analytics Cloud ROI Survey gave a sense of how nearly 400 business technology professionals see the financial picture shaking out for public cloud services. One interesting finding: IT is more confident that business units will consult them on cloud decisions than our data suggests they should be.
Fact is, outsourcing of all types is seen by business leaders as a way to get new projects up fast and with minimal miss, fuss and capital expenditures. That goes double for cloud services. But when you look forward three or five years, the cost picture gets murkier. When a provider perceives that you’re locked in, it can raise rates, and you might not save a red cent on management in the long term. In fact, a breach at a provider site could cost you a fortune—something that’s rarely factored into ROI projections.
In our survey, we asked who is playing the Dr. No role in cloud. We also examined elasticity and efficiency. Premises systems—at least ones that IT professionals construct—are always overbuilt in some way, shape or form. We all learned the hard way that you’d better build in extra, since the cost of downtime to add more can be significant. Since redundancy creates cost, we asked about these capacity practices, flexibility requirements, key factors in choosing business systems, and how respondents evaluate ROI for these assets.
Your answers showed us that adopting organizations aren’t nearly as out to lunch as cloud naysayers think. In this report, we’ll analyze the current ROI picture and discuss what IT planners should consider before putting cloud services into production, to ensure that the fiscal picture stays clear. (May 2010)
Survey Name: InformationWeek Analytics Cloud ROI Survey
Survey Date: April 2010
Region: North America
Number of Respondents: 393