Managed Cloud Services Help Enterprises Achieve Strategic Objectives

By Diane Clay posted 07-06-2020 14:50


Managed Cloud Services Help Enterprises Achieve Strategic Objectives

Enterprises are under pressure to create agile IT environments that can adapt quickly to the market, support new revenue streams, and link IT with business performance, all while meeting ROI, productivity, and profitability objectives. Just consider that 30% of firms want to provision applications within a week and 10% within 1 day, and sometimes less. To meet these needs, enterprises are turning to MSPs (managed service providers) to help them transform their IT to cloud and ensure operational excellence through managed cloud services.

Over the past year IDC has talked with more than two dozen executives using managed cloud services. Our discussions uncovered that ensuring the value in using these services requires:

·         Target objectives & control. Clearly defining a firm’s business and technical objectives and implementing robust governance to help maintain control of all resources

·         Roadmap definition. Building a road map for the most appropriate migration and modernization strategy on an application by application basis

·         Versatility of portfolio. Having access to different combinations of cloud from private and public to hybrid

In migrating to the cloud, enterprises are looking to implement DevOps and CI/CD (Continuous Integration, Continuous Delivery) capabilities to support deploying cloud-native applications and associated infrastructure. These capabilities not only can accelerate development and deployment of cloud applications, but also help enhance organizational coordination between IT and users while also improving the quality of security and compliance.

Additionally, buyers are looking to implement advanced automation involving cognitive/AI to enable more efficient IT operations, link business processes with IT and align consumption of IT with individual roles. This needs to involve the use of advanced analytics to extract greater value through the mining of data resources across the application life cycle, which can enable faster time to market, rapid innovation, improved business decisions and customer experience.

Success for Enterprise Transformation Depends on Overcoming Key Challenges

As enterprises continue to adopt different types of clouds (private, public, hybrid), they are facing the following key challenges.

·         Migrating and modernizing IT for the cloud. Complexities of migrating and modernizing IT to cloud require not just determining which applications should move to the cloud and when to do this, but also considering important factors such as regulations and security, degree of interdependencies with adjacent applications and business processes, SLAs, and the range of software from legacy custom-coded to packaged applications.

·         Creating a DevOps culture. Implementing DevOps, and associated CI/CD capabilities to provision applications rapidly for the cloud necessitates making fundamental changes to enterprise culture, roles, organizational structures, and processes. This is because many firms have traditional siloed organizations that can impede the more agile, transparent, and iterative processes needed to deploy cloud-native applications.

·         Ensuring security and performance. In moving to cloud, continued challenges exist around the potential lack of effective security and inability of cloud to support the performance of critical applications. Mitigating these concerns requires using approaches involving DevSecOps and integrating robust management platforms that can monitor, assess, and remediate issues as defined by policies to ensure compliance with regulations.

How to Position Use of Managed Cloud Services to Ensure Success

So, what are buyer expectations when using MSPs to support cloud needs? To begin with, and as Figure 1 highlights, enterprises view the role of MSPs as supporting a firm's growth strategy (e.g., entering new markets, mergers and acquisitions), ensuring efficient infrastructure and optimizing application portfolios. As part of this, enterprises expect MSPs to help replace legacy technologies with private and/or public cloud options using a range of approaches (e.g., rehost/re-platform/recode) in combination with innovative capabilities (e.g., DevOps, CI/CD, PaaS) while also utilizing strategic partners for public cloud resources.

Figure 1

Strategic Role of Managed Service Providers

n = 1,501

Source: IDC's Worldwide Managed CloudView Survey, 2019

From a skills perspective, enterprises look to MSPs for portfolio rationalization and modernization that includes legacy applications expertise, experience in designing robust security blueprints, and public cloud expertise. This must support many workloads (e.g., ERP, CRM, SCM, etc.) using new technologies (e.g., containers/serverless, open source), platforms for cloud-native development (PaaS), and critical automation such as cognitive/AI.

For enterprises looking to optimize the value of cloud, it is important that they seek an MSP whose portfolio of offerings span legacy and cloud, private and public clouds, the full lifecycle of services, innovative technologies and methodologies, the ability to migrate and modernize legacy applications for the enterprise, commitment to guaranteed business outcomes, and the right partners for public cloud capabilities. Collectively, this portfolio will help ensure optimal performance of a client's IT and cloud resources while ensuring that they can meet their business and IT objectives.

About the Authors

David Tapper

Program Vice President, Outsourcing and Managed Cloud Services

David Tapper serves as Program Vice President for IDC's Outsourcing and Managed Cloud Services research team which develops research for technology outsourcing and managed services, business process outsourcing (BPO), and global sourcing, also referred to as offshore/nearshore. As part of this research, the group covers emerging services areas including mobility, social media, analytics, automation, IoT and cloud services. Mr. Tapper also provides strategic thought leadership on the transformation of the services industry to newer models of delivery including cloud computing, managed cloud services and SaaS (Software-as-a-Service).

Peter Marston

Research Director, Worldwide Intelligent Application Services

Pete Marston is Research Director for IDC, responsible for the Worldwide Intelligent Application Services practice.  He develops research focused on the lifecycle of application delivery and related services markets that include Custom Application Development (CAD), testing, Application Management (AM), also referred to as ADM (Application Development and Maintenance), and Hosted Application Management (HAM). Mr. Marston's research also reviews how modern application delivery, leading edge technology platforms and tools, and application lifecycle management methodologies are evolving and shaping the application services markets and contractual relationships. His research has a particular emphasis on services like agile and DevOps, artificial intelligence and automation, containers and microservices, cloud (i.e. SaaS, PaaS), and mobility help organizations achieve digital transformation objectives, as well as how modern application delivery practices and technologies are creating new opportunities and challenges for application service providers.

For More Information

See IDC's white paper sponsored by Hitachi Vantara "Hitachi Vantara and AWS: Optimizing the Value of Cloud Services for Enterprises".