Singapore close to a tipping point for cloud-first mindset

ServiceNow has found that Singapore is slated to reach tipping point for cloud adoption, with the majority of enterprises likely to become cloud-first by next year. Going cloud-first is defined as shifting from traditional data centre computing, where IT buys, deploys and manages the hosting platform, to a cloud model, where the business neither owns nor manages the platform, but rather consumes on a pay-as-you-go basis.

"Cloud is more accepted than it was three to four years ago. The government is actually driving that agenda," Jimmy Fitzgerald, VP and GM, ServiceNow Asia Pacific and Japan said. 

Source: ServiceNow infographic.

In their Cloud Computing Tipping Point survey, the company shared three key findings with major implications for CEOs, CIOs and the IT department:

Reality is catching up to the hype for cloud computing

For years, pundits have predicted an enterprise shift from traditional data centre computing and results have shown that for the first time ever, almost half (44%) of respondents are taking a cloud-first approach. This is specifically with new apps and services being hosted in the cloud as opposed to on infrastructure that the enterprise already owns and manages.

The practice is projected to grow to 59% within two years, which translates to the tipping point (more than 50%) of companies going cloud-first likely to occur this year. Figures for the US came in at below these numbers, whereas Australia was ahead of Singapore.

DevOps is leading the charge to a cloud-first world

DevOps, born out of the agile development movement, aims to reduce the cycle time between software development releases. This movement aims for early and frequent communication between IT and developers – which had not traditionally been the case – and puts pressure on how enterprises deploy new applications.

 Nearly every respondent (97%) reported that they are involved in some way with the DevOps movement

 Almost three-quarters (73%) of respondents said that the rise of DevOps is driving the IT shift

 Three in five (59%) respondents see DevOps more as an operating philosophy to be taught to existing departments, rather than an entirely new division

A cloud-first world demands new IT skills

 Seventeen in 20 (85%) of companies who have completed making the shift to a cloud-first model said their current IT staff lacked the required skillsets to help them make this shift

 The majority (92%) of respondents feel that the cloud could be a replacement for a formal IT department

Yet, while IT is in danger of becoming obsolete or marginalised in this new order, there were two data points that showed a silver lining in Singapore:

 Seven in 10 (71%) respondents said the cloud shift actually raised IT’s relevancy to the business

 Two thirds (65%) said IT will be completely essential in the future

“Cloud computing has been around since the late 90s and is finally about to reach its tipping point here in Singapore, said Fitzgerald. “At this point, both opportunities and dangers arise – enterprises must ensure that they are paying attention and not let themselves be lulled into inaction."

One reason is that business stakeholders may order software-as-a-service without informing IT. When IT's visibility is obstructed, cost predictions can be surprisingly high, Fitzgerald explained. "IT is coming to the enterprise in ways it never did before, which makes it difficult to have that 360^o view. IT needs to get to a point (where it can predict) the cost around that."

Moving to a cloud-first world changes everything, ServiceNow said. IT organisations could become strategic partners to the enterprise by shifting from being a builder of computer infrastructure to a broker of cloud services. "There are more and more vendors to the enterprise...That requires IT to play this role around integrating those services... how do you successfully on board them, how do you successfully integrate them into the lifecycle," Fitzgerald said.

The company suggests five steps for IT leaders:

1. Ask what services are provided to the business. Identify and describe what 'service' means clearly to your organisation and show how this aligns to key business initiatives at an enterprise level

Fitzgerald explained that while IT typically provisions servers for the business, business executives are only interested in how software can deliver on operational activities such as email and payroll. IT should therefore conduct business-centric discussions, he said.

"Measure what matters," Fitzgerald advised. "Is IT compliant, is IT available, what's the cost of running IT on an ongoing basis?"

2. Focus on the key performance indicators (KPIs) and communicate progress against them to the larger organisation

3. Leaders need to identify any inefficiencies and hold each other accountable for the service dependencies between their teams

4. Streamline the IT organisation to align more towards more revenue-driving initiatives that are important to lines of business (LOBs) to regain the trusted partnership with the business and provide higher satisfaction overall

5. Let industry leaders take care of the rest: IT organisations need to focus innovation and top-line revenue generation instead of trying to be a system builder and operations centre

"Your job is to understand what the needs of the business are and to drive those needs, not building or operating those systems," Fitzgerald elaborated.

Fitzgerald also shared that ServiceNow has embraced the lean and agile movement in its customer engagements. Lean, agile and DevOps terms are often used interchangeably today. "Every engagement manager is a scrum master," he said. "We use our own project and portfolio management applications."

While he acknowledged that some organisations are more used to formal documents and sign-offs in some parts of Asia with that, ServiceNow continues to challenge the established order.

Strategising has become very different as shorter-term plans that can be quickly refined have replaced the traditional long-term plans. "(We plan) where we might be in the next 60 days to validate our assumptions in a market. Based on our learnings we hen move this way or that way in that market," he said.

*ServiceNow commissioned ReRez Research in the US to design and conduct a study about the state of cloud computing in companies with 500 or more employees. The survey was fielded in August 2016 in the US, the UK, Australia, Singapore, Germany, France and the Netherlands, and explored insights about shifting from traditional data centre computing to cloud computing (software-as-a-service, infrastructure-as-a-service and platform-as-a-service). A total of 1,850 senior managers, split evenly between IT, DevOps and line of business (LOB) management roles, completed the survey. The survey included 225 Singaporean senior managers, split evenly between the three management roles, as well as a similar number of Australian managers.