Communications to the Cloud: Business and financial drivers

Communications in the Cloud: Why It Makes Sense for Today’s Business

Business and financial drivers

Organizations are also facing business and financial issues that are encouraging them to move communications to the cloud. Many businesses are dealing with flat or shrinking economies; as a result, they’re keeping tight reins on technology spending. A global survey of 2,053 CIOs (representing more than $230 billion in IT budgets and covering 36 industries in 41 countries) conducted by Gartner in the fourth quarter of 2012 showed that CIOs in general expect their 2013 IT budgets to be essentially flat for the fifth straight year. CIO IT budgets have been flat to negative ever since the dot-com bust of 2002, Gartner stated,and, for 2013, IT budgets are projected to be slightly down, with a weighted global average decline of 0.5 percent. As a result of these economic pressures, organizations are increasingly focused on return on investment and total cost of ownership for IT deployments. As IT faces pressure to do more with less and to show payback on every major technology initiative, the efficiencies made possible by cloud-based services allow enterprises to more cost-effectively deliver infrastructure and applications to users. Cloud models basically extend organizations’ IT resources and skills, providing economies of scale by sharing resources and speeding to time value.

The cloud also enables companies to move to an operating expenses model rather than a capital expenses one, helping CIOs to better deal with the economic pressures. To remain competitive, companies need to run the most efficient, flexible infrastructures possible. Cloud services support business agility by allowing organizations to quickly scale operations up or down as needed. In addition, businesses need to be able to reach across their supply chains, extending teams horizontally and vertically across the chain. With a cloud-based communications solution, it doesn’t matter what type of existing communications infrastructure a supply chain partner uses. Finally, in challenging economic times, CIOs may become more risk averse to avoid spending on the wrong technology. The result is that they do nothing, and their organization falls behind its competitors. It’s therefore critical that they keep the organization moving forward by investing in a communications solution that can be deployed in any of the models along the cloud scale, offering maximum agility to change as the organization evolves.
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Stay tuned with the “Key Factors Driving Communications to the Cloud” post series.

Next post: Cloud Computing Benefits, Public/Private clouds and more…

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