SaaS and the enterprise perception

Transcription

1 SaaS and the enterprise perception A REPORT FROM NCC GROUP

2 Introduction? Cloud computing is increasingly becoming entrenched into the modern IT landscape. The phrase is used to strike fear into IT departments and executives alike, but it is losing its fear factor. According to Gartner s latest Hype Cycle, cloud computing is currently in the Trough of Disillusionment, and is only five years away at most from a Plateau of Productivity. Executives are increasingly realising that cloud can be a catalyst for process improvement as well as a driver of business transformation.* One element of the cloud computing mix that holds a lot of promise is softwareas-a-service (SaaS). It s less than two decades old, but businesses are seeing the benefits of a pay-to-play model when it comes to software. Easy updates, lower initial costs and higher adoption rates by users are all on offer. But there are still clear risks. At the end of 2013, Gartner predicted a major consolidation in cloud services and estimated that about 25% of the top 100 IT service providers in the infrastructure space won t be around by This was due to a range of reasons, such as acquisition or bankruptcy. Legitimate commercial security fears cast a shadow over the success of the SaaS market. Where does that leave the customers business who adopted SaaS? Will their cloud software, which in many cases will be business critical, still be available to them? To get a better understanding of the customer perspective, we commissioned Vanson Bourne to survey CIOs across a broad cross section of businesses. 100 CIOs from businesses with over 1,000 and across a range of sectors were questioned. This took place in two separate questionnaires in The results we present here shine a light on the current SaaS landscape within the enterprise. This is a resource that will help shape the strategies of both customer businesses and SaaS providers. * 2014 KPMG Cloud Survey Report 2

3 The growth of the cloud The growth in cloud services is much talked about and our research backs it up. The majority of respondents are utilising cloud services with more planned for Half of the CIOs we spoke to have already taken a step into the cloud and plan to transfer further elements there in the next 12 months. That s a significant number, and if we add on the 19% that plan to take their first steps within a year it becomes a sizable majority. 60% 50% 40% 30% 20% In terms of sector specific findings, financial firms are leading the way in terms of cloud adoption. All had either adopted some form of cloud service or were planning to. On the other hand almost a half of manufacturing companies say they won t be moving anymore of their business functions into the cloud this year. 10% 0% Total More than 3000 Financial services Yes - we plan to adopt more cloud services in the next 12 months Yes - we plan to start adopting cloud services in the next 12 months No - we have no plans to adopt more cloud services in the next 12 months No - we have no plans to start adopting cloud services in the next 12 months Manufacturing Retail, distribution and transport Other commercial sector Number of seats in an enterprise doesn t make a significant difference. 94% of companies with , and 94% of companies with over 3000 had adopted some sort of cloud service. It s evident that the cloud is continuing to make inroads into the enterprise. Next we ll look at where within these companies it s taking hold with particular reference to SaaS. Impact of commercial failure Of those organisations who confirmed that a contingency plan was in place in the event of provider failure, the average time to implement the plan was 3 weeks. What would be the impact if your business services were unavailable for that length of time? 3

4 SaaS within the enterprise Our research found that cloud applications are being used across the enterprise. Departments from finance to human resources make use of SaaS applications. 60% 50% 40% 30% 20% 10% 0% Finance Human resources Enterprise resource planning Business analytics / management information system Supply chain management Currently using Considering using Not considering using SaaS software for HR is the most popular, with 40% of respondents currently using it. Clearly there s a growing feeling that enterprise resource planning (ERP) could be moved to the cloud, with 42% considered adopting it. At the time of the survey there weren t any cases where over half of businesses responding having embraced SaaS, but the tipping point was very close. SECTOR FINDINGS Manufacturing firms more likely to use SaaS for finance, supply chain management, HR and ERP. Retail and transport companies more likely to use SaaS for business analytics Companies with 3000 or more more likely to use SaaS in all cases apart from for supply chain management. 4

5 Cloud concerns Concerns around cloud do still remain, holding adoption rates back. The benefits are widely known, but overriding doubts and uncertainties continue to deter CIOs. This graph shows why respondents who have yet to adopt cloud services have been put off: 80% 70% 60% 50% 40% 30% 20% 10% 0% Total More than 3000 Financial services Manufacturing Retail, distribution and transport Other commercial sector Data security Cost Integration Geographical location of servers Resource I don't know my organisation's reasons for not adopting cloud applications Loss of control of key IT element Data back-up/disaster recovery implications Compatibility Supplier viability *Other (please specify) Providers clearly haven t completely convinced customers that corporate data will be secure. This is overwhelmingly the biggest concern from CIOs. The fact is, data in the cloud can often be more secure than that which is on-premise with cloud providers able to use a wealth of expertise and resource to keep it ring-fenced and safe. The pressure for compliance and business certainty dictates the need for data availability and service continuity. The viability of the supplier is perceived as a less pressing problem which is possibly since the high profile collapses of the likes of 2e2 and Code Spaces have receded from memory. It is essential customer organisations realise the dangers associated with supplier failure particularly as this doesn t necessarily mean the supplier going out of business. It could arise through merger or acquisition, when the acquirer decides to stop supporting the services the target company previously offered. ON 2E2 2e2 was an IT supplier focused on offerings and managed services for medium and large private and public sector organisations, delivered on premises, in the cloud or as a hybrid of the two The firm was placed in administration on the 28th January 2013 There was no possibility of migrating mission-critical data in the time before 2e2 s administrator s threatened to close the businesses. As a result, many clients were forced to explore alternative ways of recovering data, at a high cost, some to no avail. 2e2 s datacentres were acquired at the eleventh hour by Daisy Group

6 Cloud contingency Contingency is critical when it comes to the cloud for both providers and customer. Providers need to be able to demonstrate that if the worst happens the customer won t be affected. This can be a real point of differentiation from competitors. For the customer, if there s no clear contingency plan it is a barrier to investment But what assurance measures do CIOs currently have in place? 70% 60% 50% 40% 30% 20% 10% 0% Total More than 3000 Financial services Manufacturing Retail, distribution and transport Other commercial sector Yes - continuity plans Yes - contractual plans Yes - data availability plans No Only 32% have contractual protection from problems, issues or failure. This is low and some sort of legal safeguard should be standard procedure. You can imagine a scenario where a critical piece of software becomes unavailable. In many industries or organisations, this would have a devastating impact on regulatory compliance, market perception or where data is relevant. The 11% that have no plans in place are walking a very dangerous line. Even those that have put less important data or applications in the cloud still should have some policies in place for retrieval if there is a failure. The picture gets more interesting when we look at who was the driving force behind these contingency measures the provider and the customer. 60% 50% 40% 30% 20% 10% 0% Total More than 3000 Financial services Manufacturing Retail, distribution and transport Other commercial sector Yes, it was offered as part of the service No, my provider does not offer a contingency plan Yes, but we had to request this in addition to the service offered We do not use cloud services Only 41% of CIOs had providers that offered a clear contingency plan as part of their service. Almost half of customers had to push for it showing the appetite for clear assurance measures from the end user community. 6

7 Conclusion The results of our research have revealed a cloud landscape that is not yet perceived to be secure and free from risk. SaaS adoption is gaining momentum and it will continue to grow. But many CIOs harbour doubts about the cloud, mainly because providers aren t doing a good enough job of putting measures in place that will allay their fears. For the SaaS market to move forward faster and deeper, providers need to confidently offer a service which is innovative, watertight and protects against the impact of failure however unlikely this may seem. It s up to cloud players, from small SaaS startups to established ISVs, to step up and deliver this for the customer community.? 7

8 About NCC Group NCC Group is a global information assurance firm, passionate about making the internet a safer place and revolutionising the way in which organisations think about cyber security. Through an unrivalled and unique range of services, the company provides organisations across the world with freedom from doubt that their most important assets are protected and operational at all times. Listed on the London Stock Exchange, NCC Group is a trusted advisor to more than 15,000 clients worldwide, including over 90% of the FTSE 100. Headquartered in Manchester, UK, NCC Group has 20 offices across the world and employs over 1,000 of the brightest minds in information security, assurance and technology. NCC Group delivers security testing, software escrow and verification, website performance, software testing and domain services. 8

9 About SaaS Assured SaaS Assured from NCC Group is a straightforward, costeffective, contractual solution that makes it easy to embrace the cloud by giving SaaS customers peace of mind that they can have continued access to their application and data in the event of SaaS provider failure, allowing time to transition to an alternative solution, without interruption to service. Through a straightforward contractual agreement NCC Group ensures that in the case of SaaS provider failure the existing production infrastructure running the application continues to remain available. This ensures availability for a period of time sufficient to allow the organisation to make a controlled migration to an alternative solution. Call us on: +44 (0) us: saasassured@nccgroup.trust 9

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