By Jay Litkey, EVP of Cloud Management.
In the wake of COVID-19, enabling remote work has required many IT teams to rapidly lean into cloud technologies to keep their businesses operating smoothly.
As public and private cloud usage has continued to rise throughout the pandemic, it is clear that what was initially a sudden shift will now become a permanent change for many organisations. This rapid change will create the agility that many organisations are desperate for but will likely also create longer-term problems around budget overspending, among other things.
So what has the increase in cloud usage looked like so far in response to pandemic restrictions? While increased reliance on collaboration and video conferencing applications like Zoom and Teams dominated the headlines early in the remote work shift, dependence on cloud infrastructure and services may have been more popular – and is likely to continue to impact organisations for the foreseeable future.
According to a recent survey by Snow Software, 76% of IT leaders said they had increased their use of cloud platforms with services such as Amazon Web Services (AWS), Microsoft Azure and even private cloud (typically VMware-based). A further 55% noted an increase in collaboration tools like Slack, Teams or Google Chat and an additional 52% of those surveyed indicated an increase in cloud-based video conferencing software like Zoom, Cisco WebEx or GoToMeeting.
While many companies already relied on some productivity tools before the pandemic, the surge in cloud infrastructure use represents a fundamental shift in how organisations operate. These trends hint at a considerable change in enterprise cloud strategy.
As IT leaders face the concurrent challenges of continuing to support remote working, enabling a possible return to the workplace and tightening budgets, 91% said they are altering their cloud strategy as a result of the current economic climate. What’s more, twice as many say they are accelerating cloud migration (45%) and digital transformation (41%) versus putting those initiatives on hold (22% and 21% respectively).
It’s clear the COVID-19 pandemic has turned cloud into an essential service for many organisations, as well as highlighting the complexities of managing cloud cost and usage. But what does this mean for the future of cloud usage?
No end in sight
For the time being, at least, businesses are putting a lot of faith in cloud storage to enable remote working. Snow’s recent survey also found that 82% of respondents said they had increased their cloud usage in response to the pandemic.
While COVID-19 restrictions continue to ease in some parts of the world, the majority of workplaces are still encouraging remote working where possible – or creating hybrid remote/physical office working conditions. Realistically, this could be the reality for some time. According to Snow’s statistics, 60% of IT leaders have said that their cloud usage is actually still increasing, which means that IT teams are continuing to invest in ways to support the new reality of the workplace.
Looking to the future, just under half (47%) said they would feel comfortable returning to their offices once their company deems it safe to do so, and a further 43% would like their company to offer remote working options still. The reality is that remote working and the dependency on cloud will play a significant role in the ‘new normal’.
Striking a fine balance
Of course, the financial strain the pandemic has had on economies will also take its toll on businesses in various industries in most countries. For example, the UK has plunged into its first recession in 11 years. This goes without saying that companies have had to streamline budgets and identify efficiencies to remain resilient and maintain business as usual, which has left business leaders with difficult decisions to make.
For many organisations, it’s about finding the correct balance between investing and saving. While there is a definite need to identify cost savings, continuing to invest in initiatives like digital transformation requires organisations to evaluate the return on investment and the opportunity it provides to ensure business stability. In an effort to find the right balance between investment and savings, 32% of respondents are asking their cloud vendors for extended payment terms, and 31% are renegotiating their cloud contracts.
The future of cloud usage and working practices
As businesses begin to welcome back employees to their physical places of work, the use of cloud will continue to be concurrent with our working lives. Two-thirds (66%) have reported that they will continue to use the cloud services and applications they implemented during the crisis.
Communication, for starters, will be one of the most significant changes to everyday working life. One of the biggest issues companies faced when moved into lockdown was internal communications. So, it is not overly surprising to see that video conferencing apps like Zoom, WebEx and GoToMeeting (73%) and communications apps like Slack, Teams and Google chat (65%) were cited as ‘lifesaving’ applications beyond core IT software. Businesses are expected to offer greater flexibility with remote working, meaning these applications will become more commonplace moving forward.
It is clear to see that the COVID-19 pandemic has turned cloud – whether public, private, hybrid or multi – into an essential service for many organisations. It has also highlighted the complexities of historically managing cloud cost and usage. While many CIOs are being asked to trim costs, there will be continued investment in technology that presents the opportunity for long-term growth and stability. To weather the storm, IT leaders must take a comprehensive approach to managing complex cloud environments, uncovering opportunities to streamline costs, while continuing to provide the infrastructure and services needed to support the workforce and drive innovation.