EY Norwegian Cloud Maturity Survey Current and planned adoption of cloud services

Transcription

1 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

2 Contents 01 Cloud maturity 4 02 Drivers and challenges 6 03 Current usage Future plans About the survey 22 2 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

3 Introduction Cloud adoption in Norway is increasing; but a lack of cloud expertise and the complexity in migrating legacy applications are still holding the adoption back. Reduced time-to-market with new digital solutions is driving cloud adoption The most important business driver for cloud adoption is reduced time-tomarket with new digital solutions. Cost savings are less important among the respondents this year; hence being able to release new digital services faster with the support of a scalable cloud platform seems to be more important than costs. The lack of cloud expertise and the complexity in migrating legacy applications are holding cloud adoption back The percentage of respondents that considers the lack of cloud expertise as a challenge related to using cloud services has increased significantly since last year s survey. The complexity in migrating legacy applications is still a barrier for large-scale adoption of cloud services. This indicates that Norway is still immature when it comes to cloud computing and that more experienced people within the domain are required to handle the current cloud transformation. DevOps and serverless are mainstream The number of respondents that are applying DevOps methods has increased significantly this year. About 39% of the respondents are using serverless PaaS cloud services. These findings indicate that these methods and services are now mainstream in the Norwegian market. Multi-cloud is the new black About 7 of the respondents are using two or more IaaS or PaaS providers indicating that a multi-cloud strategy is popular among the largest organizations in Norway. Compared to 2018, there is an increasing focus on executing on cloud initiatives rather than developing cloud strategies About 32% of the respondents have even planned to start the migration of all their datacenters to Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) in 2019, showing that many large Norwegian organizations have decided to embrace the cloud fully. EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 3

4 01 Cloud maturity 01 Cloud maturity 4 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

5 01 Cloud maturity Cloud maturity of organizations operating in Norway, the Nordics, and Europe or globally are at a similar level Average cloud maturity based on geographical footprint Average cloud maturity level of respondents on a scale of one to five, where five is the highest Average cloud maturity of the respondents is between two and three. Norway Nordic Europe/Global Organizations with a Norwegian footprint have lower average cloud maturity than the ones with a Nordic and European or global footprints. This can be attributed partly to the relatively low maturity of the government and public sector respondents. Average cloud maturity based on sector Average cloud maturity level of respondents on a scale of one to five, where five is the highest Power and utilities Transportation and logistics Construction Health and life sciences Industrial products Oil and gas The power and utilities sector has the highest cloud maturity, followed by transportation and logistics, and construction. The government and public sector has the lowest score of 2.1 on the maturity scale. The financial services and insurance, and consumer products and retail sectors have low maturity as well. Consumer products and retail 2.2 Financial services and insurance 2.2 Government and public sector 2.1 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 5

6 02 Drivers and challenges 02 Drivers and challenges 6 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

7 02 Drivers and challenges Reduced time-to-market with new digital solutions is driving cloud adoption; but the lack of cloud expertise is holding companies back Key business drivers for moving to the cloud Percentage of respondents reporting the driver Reduce time-to-market with new digital solutions Drive digital transformation Drive business innovation 59% 5 69% 66% 70% 66% There are many business drivers for moving to the cloud. Reduced time-tomarket with new digital solutions is the most important driver this year, followed by digital transformation and business innovation. Improve business scalability Reduce costs Develop new products and services 31% 49% 62% 59% 55% 68% However, there is less interest in moving to the cloud to drive revenue growth, just like in last year. Reducing costs is also a less important driver in this year s survey. Drive revenue growth 1 19% 2018 Other 3% 2019 Benefits of using cloud services Percentage of respondents reporting the benefit Greater scalability Shorter time-to-market with new digital solutions Higher availability Shorter IT infrastructure deployment time Improved IT security Improved IT operational efficiency Increased developer productivity Reduced IT operational risk Cost savings Move from CapEx to OpEx Improved customer experience 59% 65% 55% 35% 52% 46% 52% 32% 48% 5 48% 30% 45% 43% 41% 51% 41% 35% 3 72% 73% Just like in 2017, greater scalability is the most commonly mentioned benefit of using cloud services. Shorter time-tomarket is reported as a significant benefit. As these two successfully improved IT operational efficiency last year, it seems that flexibility and scalability are still viewed as more important than cost reduction and efficiency improvements. Larger geographic reach is reported as a more significant benefit than last year. This indicates that cloud services are more commonly used to expand the geographical reach of Norwegian organizations. Higher performance Larger geographic reach Business continuity Other Do not use cloud 0% 5% 3% 31% 22% % EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 7

8 02 Drivers and challenges 8 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

9 02 Drivers and challenges Challenges related to using cloud services Percentage of respondents reporting the challenge Lack of cloud expertise 43% 62% Complexity in migrating legacy applications Vendor lock-in Security concerns 59% 52% 5 52% 51% 70% Compliance and/or regulations 46% 52% Storing data outside of Norway 48% Complexity of managing cloud costs 35% 45% Current identity management solutions and processes 30% 45% Complexity of managing multiple cloud services 28% 36% Move from CapEx to OpEx Performance 5% 1 11% 10% Other Do not use cloud 3% Lack of cloud expertise and complexity in migrating legacy applications are reported as the most significant challenges related to using cloud services. Concerns related to security and compliance or regulations are also reported as challenges. Data residency is an important subject that has been highly discussed lately. Norwegian organizations perceive that storing of data outside Norway is a challenge related to using cloud services. EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 9

10 03 Current usage 03 Current usage 10 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

11 03 Current usage The current usage of cloud-based services is still low but increasing with Microsoft as the dominant service provider Share of cloud-based IT applications Percentage of responses within each range 80% 100% 60% 79% 40% 59% 3.3% 3.3% 10.0% Norwegian organizations have a relatively low cloud adoption as 73% of the respondents use cloud services for only 1% 19% of their applications. 20% 39% 10.0% 1% 19% 73. Do not use cloud 0.0% Share of cloud-based IT applications Percentage of respondents with each range split on the respondent s geographical footprint Europe/global Nordics Norway 0% 100% 60% 20% 10% 10% 75% 25% 81% 6% 13% 1% 19% 20% 39% 40% 59% 60% 79% 80% 100% Respondents with a Nordic footprint have a higher share of cloud-based IT applications than those with a Norwegian or European or global footprint. The organizations with a Norwegian footprint have the lowest share of IT applications in the cloud. The considerable number of government and public sector respondents with a purely Norwegian footprint might contribute to that. EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 11

12 03 Current usage SaaS-based IT applications used Percentage of respondents using the application Microsoft Office 365 Microsoft Power BI JiRA GitHub Confluence Microsoft Dynamics 365 Slack ServiceNow Adobe Creative Cloud DocuSign Other Dropbox Visma.net 25% 19% 25% 22% 25% 22% 21% % 11% 32% 38% 35% 39% 32% 32% 32% 46% 50% 50% 75% 76% The situation is similar to the 2018 report results with Microsoft Office 365 being the most used cloud-based IT application in the Norwegian market. Microsoft still has an overall strong position with Office 365, Power BI and Dynamics 365. JIRA, GitHub and Confluence are more commonly used than last year, which indicates an increased focus on the use of SaaS-based IT applications for software development and IT operations. Salesforce.com SAP Sucessfactors New Relic Box Workday 11% 5% 11% 5% 5% Hubspot Google G Suite AppDynamics 11% Zendesk SAP Ariba 3% Oracle Sales Cloud Oracle HCM cloud Do not use SaaS 3% 5% EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

13 03 Current usage Share of cloud-based IT infrastructure Percentage of responses within each range 80% 100% 60% 79% 40% 59% 20% 39% 1% 19% 0.0% 3.3% 3.3% About 93% of the respondents have below 40% of their IT infrastructure in the cloud. The share of cloud-based IT infrastructure is significantly lower than the share of cloud-based IT applications, which indicate that Norwegian organizations currently are adopting SaaS based IT applications faster than IaaS/PaaS cloud-based IT infrastructure. Do not use cloud 10.0% Number of IaaS or PaaS providers used Percentage of respondents within each category The majority of the respondents use two or more IaaS or PaaS providers, and 28% uses three or more providers. The low level of respondents using only one provider indicates the popularity of a multi-cloud strategy in the Norwegian market. 14.3% % None One Two Three Four or more EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 13

14 03 Current usage IaaS or PaaS providers used Percentage of respondents using the provider Microsoft Azure Amazon Web Services (AWS) Google Cloud Platform IBM Bluemix/Cloud Oracle Cloud Platform Heroku 11% 21% 5 75% Microsoft Azure is the most popular IaaS or PaaS provider among the respondents with Amazon Web Services (AWS) not far behind, having increased its popularity by 31% since last year. Google Cloud Platform has made it to the list of top three most popular IaaS or PaaS providers with a relatively higher share than the other providers, which indicates that taking a larger market share than the top three is difficult for the other providers. Alibaba Cloud Force.com Do not use IaaS/PaaS 18% Cloud workloads used Percentage of respondents using the workload Apps Databases Storage Integration services Data analytics 22% 22% 28% 29% 29% 29% 36% 39% 4 6 Apps and databases are reported as the most used cloud workloads. There is a high cost and limited flexibility involved when using databases on premise, which can be a reason for a higher share of the respondents using cloud databases. Machine Learning 1 25% Front end solutions Disaster recovery (backup) Container services % 25% Internet of Things (IoT) 11% 8% Other High performance computing 0% 11% Desktop 19% Push notifications Do not use Iaas/PaaS 8% 18% 22% EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

15 03 Current usage Use of unsanctioned and approved cloud services Percentage of responses within each range > % 6.6% 10.0% There is a high share of respondents that use a large number of unsanctioned as well as sanctioned cloud services. This indicates that the Norwegian market still has a fairly low cloud maturity % % 46. Do not use cloud Unsanctioned cloud services * Approved cloud services * Cloud services that are not formally approved for use in the organization Number of unsanctioned cloud services used by the respondents with 1 9 approved cloud services Percentage of respondents within range 29% Organizations using only 1 9 approved cloud services have many unsanctioned cloud services. The use of unsanctioned ones are also high in those organizations reporting the use of approved cloud services. 5 Do not use cloud >50 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 15

16 04 Future plans 04 Future plans 16 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

17 04 Future plans Executing on cloud road maps and implementing increased automation and cloud management or monitoring are major priorities in 2019 Top cloud initiatives planned for 2019 Percentage of respondents reporting the initiative Execute on our cloud road map Implement increased automation in our digital development lifecycle Implement cloud management/monitoring Implement improved security in our digital development lifecycle 25% 31% 36% 36% 46% 50% 5 5 The responses reflects a high focus on the execution of cloud road maps and increased automation in digital development life cycle. Security concerns, compliance and storing of data outside Norway are reported as challenges in using cloud services. Build new cloud native digital applications Migrate legacy systems to the cloud Develop a cloud strategy Start the migration of all our datacenters to IaaS/PaaS Run a tender process toward managed cloud IaaS/PaaS service providers 11% 19% 25% 32% 46% 4 43% 43% 4 Compared to 2018, there is an increasing focus on executing on cloud initiatives rather than developing cloud strategies. About 32% of the respondents have planned to start migration of all their datacenters to Iaas or PaaS in 2019, showing that many Norwegian organizations have decided to embrace the cloud fully. Run a tender process toward IaaS/PaaS technology providers Other 19% Top two cloud initiatives planned for 2019 based on geographical footprint Percentage of respondents reporting the initiatives split on the respondent s geographical footprint Execute on our cloud road map 4 55% 60% Organizations with a Nordic footprint have more focus on executing on their cloud road map compared to those with a European or global footprint. Implement increased automation in our digital development life cycle 40% 45% 56% Norway Europe/global Nordics EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 17

18 04 Future plans Organizations in the Norwegian market are planning to increase the use of cloud-based applications as well as increasingly transitioning the IT infrastructure to the cloud Share of IT applications estimated to be cloud-based in the following years Percentage of responses within each range 0% 100% 1 year 5 25% 3 years 50% 21% 11% The share of IT applications that are cloud-based is expected to increase in the coming five years. Within three years, 11% of the respondents estimate to have 80% 100% of their IT applications to be cloud-based. 5 years 1 36% 18% 18% 1% 19% 20% 39% 40% 59% 60% 79% 80% 99% 100% Share of IT applications estimated to be cloud-based in five years Percentage of responses within each range 53.6% 63.0% Within five years, 25% of the respondents estimate to have over 80% of their IT applications to be cloud-based. Compared with the last year s findings, this is a substantial increase of % 25.0% 17.0% 0% 39% 40% 79% 80% 100% 18 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

19 04 Future plans Share of IT infrastructure estimated to be cloud-based in the following years Percentage of responses within each range 0% 100% 1 year 50% 21% 3 years 11% 39% 1 18% 1 About 79% of the respondents estimate having less than 40% of their IT infrastructure in the cloud in However, 71% estimate having more than 40% of their IT infrastructure to be cloudbased in five years. 5 years 21% 18% 25% 1 1 0% 1% 19% 20% 39% 40% 59% 60% 79% 80% 99% 100% Share of IT infrastructure estimated to be cloud-based in five years Percentage of responses within each range 42.8% 47.2% Within five years, 29% of the respondents estimate to have more than 80% of their IT infrastructure in the cloud. Compared with the last year survey, this is an increase of 50%. 28.6% 33.3% 28.6% 19.5% 0% 39% 40% 79% 80% 100% EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 19

20 04 Future plans The IT department is taking a larger responsibility for cloudbased technology The role of IT department with regard to cloud Percentage of respondents reporting the role Define cloud security policy Decide/advise on which applications to implement in the cloud Manage cloud service contracts Set policies for cloud use Manage/optimize costs of cloud Manage all cloud deployments Do not use cloud % 79% 75% 75% Defining cloud security policy and deciding or advising on which applications to implement in the cloud are reported as two most important roles of the IT department with regard to cloud. In addition, managing cloud contracts and deciding on policies for cloud use are also of high priority. This is supported by the findings on the challenges related to cloud services with respect to security concerns and compliance. Important IT security requirements for the cloud provider Percentage of respondents reporting the requirement GDPR compliance Data processing agreement (DPA) Where your data is located Visibility of all the parties involved in the service delivery SOC 2 Report on GDPR/Privacy or similar ISAE3402/SOC 1 Report Other 36% 39% 50% 68% 86% 96% Almost all respondents report GDPR compliance as the most important IT security requirement they have for cloud providers. Data processing agreements (DPAs) and location of the customer data are also considered as important requirements. This is supported by the findings on the challenges related to cloud services with respect to security concerns and compliance. 20 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

21 04 Future plans DevOps has become mainstreaim and Serverless PaaS services are widely used Usage of serverless PaaS Percentage of respondents using or not using serverless PaaS 39% 39% of the respondents use serverless PaaS. This indicates that more advanced PaaS services are now mainstream in the Norwegian market. 61% Yes No Application of DevOps Percentage of respondents applying DevOps Yes 4 6 A total of 6 of the respondents report of applying DevOps methods, which is a significant increase from last year s survey No 36% 53% EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 21

22 05 About the survey 05 About the survey 22 EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services

23 05 About the survey Geographical footprint Percentage of respondents 32% 5 1 Norway Nordic Europe/global Organizational size Percentage of respondents 21% 43% 36% <1,000 1,000 9,999 >10,000 Sector Percentage of respondents Financial services and insurance 29% Consumer products and retail Government and public sector 21% 21% Power and utilities Oil and gas Industrial products Transportation and logistics Construction Health and life sciences The survey was conducted in November 2018, and distributed to 148 of the largest organizations in Norway, both in the private and public sector. EY Norwegian Cloud Maturity Survey 2019 Current and planned adoption of cloud services 23

24 EY contacts Christian Mjaanes Partner Ernst & Young AS Advisory Technology Consulting Sophus Slaatta Director Cloud Computing Ernst & Young AS Advisory Technology Consulting EY Assurance Tax Transactions Advisory About EY EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com EYGM Limited. All Rights Reserved. EYG no Gbl ED None This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax or other professional advice. Please refer to your advisors for specific advice. ey.com B19001no