Despite the hype, cloud adoption is still in its early days for most companies, but cloud is coming.

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1 J U L Y,

2 Despite the hype, cloud adoption is still in its early days for most companies, but cloud is coming.

3 TABLE OF CONTENTS Executive Summary Key Findings Key Conclusions Recommendations Survey Questions and Responses T A B L E O F C O N T E N T S

4 Executive Summary A D V O C A T E C O N S U L T I N G

5 EXECUTIVE SUMMARY Recently, Advocate Consulting conducted a survey and in-depth interviews with C-Level executives from leading global enterprises to find out their organization s plans for cloud adoption through Our goal was to learn how they are utilizing cloud technology today and understand future cloud strategies and usage. Our findings include: : Nearly 100% of respondents indicated they are using SaaS, but less than half (44.6%) indicated they are using IaaS. 75% of SaaS solutions are used for collaboration ( , conferencing, and CRM, etc.); 67% of IaaS use is for Development and Test. While annual spend is relatively low currently, IaaS is expected to grow more than 20% between 2013 and PaaS (Platform as a Service) planned adoption is extremely low with no respondents reporting usage. This report will provide details on key findings and conclusions derived from the survey and interviews, survey questions and corresponding responses, and our recommendations based upon the results. E X E C U T I V E S U M M A R Y

6 Key Findings A D V O C A T E C O N S U L T I N G

7 SURVEY PARTICIPANTS Advocate Consulting surveyed over 100 clients and conducted in-depth interviews with 20 more to determine their strategy and plans for cloud adoption. Majority of clients fell in the $1B to $10B annual revenue range and spanned a wide variety of industry verticals % Annual Revenue Range <500M $500M-$1B % 22% 6% $1B-$10B >$10B 0 K E Y F I N D I N G S

8 ANNUAL SPEND ON CLOUD SERVICES 100% 90% 80% Cloud adoption is still low with 62.6% of respondents spending less than $250K annually on SaaS and 66.7% spending less than $50K annually on IaaS. 70% 60% 50% 40% 30% 20% 10% Annual Spend >$2M >$1M-$2M >500K-$1M >250K-$500K >$50K-$250K $10K-$50K 0% IaaS SaaS K E Y F I N D I N G S

9 ANTICIPATED ANNUAL GROWTH RATE FOR SAAS CLOUD SERVICES 2013 TO % expect SaaS to grow at least 10% per year 19% expect SaaS to grow over 20% per year Annual Growth Rate 25.0% 18.8% 12.5% 6.3% 37.5% 0% to 5% 6% to 10% 11% to 15% 15% to 20% Over 20% K E Y F I N D I N G S

10 Key concluisons Key Conclusions A D V O C A T E C O N S U L T I N G

11 KEY CONCLUSIONS - ADOPTION All respondents have established IT shops, with only a few contemplating migrating systems into cloud environment. Most enterprises are looking at SaaS for cloud solutions. The majority of are adopting public cloud offerings (SaaS). Businesses that have adopted cloud want business solutions and do NOT want challenges of managing infrastructure even when it is offered as a service. 73.7% 5.3% 15.8% 15.8% What Cloud model have you deployed or have plans to deploy? Private Private Hybrid Hybrid Public Public None None K E Y C O N C L U S I O N S

12 KEY CONCLUSIONS - BUYERS All IT departments are involved in cloud service acquisitions but 59% of procurements are led by the business or functional unit. More than half (56%) of IT departments are concerned about uncontrolled acquisition of cloud services. As SaaS grows in vendor count and total expense, there is an emerging need to ensure solutions are well managed. K E Y C O N C L U S I O N S

13 KEY CONCLUSIONS - BUYERS (CONTINUED) Adoption varies significantly by industry. Technology-based enterprises are early adopters. Primarily SaaS adoption with some reporting SaaS First policy for their architecture. Up to SaaS products in use. Industrial enterprises have adopted very little cloud. Primary concern is need to integrate cloud solution with ERP systems. K E Y C O N C L U S I O N S

14 RECOMMENDATIONS Recommendations R E C O M M E N D AT I O N S A D V O C A T E C O N S U L T I N G C L O U D A D O P T I O N S U R V E Y

15 RECOMMENDATIONS Plan & Analyze Cloud adoption will continue to grow within the enterprise. Wellmanaged firms are analyzing cloud alternatives and planning roadmaps of adoption rather than ad hoc acquisition of cloud services. Discover Do you really know how much cloud your organization has adopted? Because cloud is easy to procure, many employees/departments are using cloud services without corporate knowledge. Critical corporate data may be migrating out of the enterprise and exposing the enterprise to security and compliance risks. Consider Service Governance Strong cloud adoption will rapidly overwhelm manual methods for identity and access management, financial accountability and optimal procurement. Organizations should consider management tools that will ensure the cloud is well governed and delivers anticipated value. R E C O M M E N D A T I O N S

16 Survey Questions & Responses

17 #1: DO YOU CURRENTLY USE INFRASTRUCTURE AS A SERVICE (IAAS)? Nearly 56% of companies are currently using IaaS. 55.6% 44.4% Yes No S U R V E Y Q U E S T I O N S & R E S P O N S E S

18 #2: WHAT DO YOU USE IAAS FOR? Almost 67 % of enterprises surveyed use IaaS for Development and Testing. 70.0% 66.7% 60.0% 50.0% 40.0% 30.0% 33.3% 33.3% Development and Testing Production 20.0% 16.7% Storage 10.0% 0.0% 0.0% Disaster Recovery Other S U R V E Y Q U E S T I O N S & R E S P O N S E S

19 #3: PLEASE IDENTIFY WHICH CLOUD SERVICE PROVIDER(S) YOU ARE USING FOR IAAS. 50% of the companies surveyed use Amazon Web Services for IaaS. 70.0% 60.0% 50.0% 40.0% 30.0% 50.0% Cloud Service Providers 66.7% Amazon Web Services Rackspace Other 20.0% 33.3% 10.0% 0.0% Amazon Web Services Rackspace Other *Some companies are using multiple IaaS providers S U R V E Y Q U E S T I O N S & R E S P O N S E S

20 #4: WHAT IS YOUR ANNUAL SPEND ON IAAS CLOUD SERVICES TODAY? More than 83% of the organizations surveyed currently spend $10,001 to $50,000 annually on IaaS Annual Spend on IaaS 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Less than $10, % $10,001 to $50,000 $50,001 to $250,000 $250,001 to $500,000 $500,001 to $1,000,000 $1,000,001 to $2,000, % Over $2,000,000 Less than $10,000 $10,001 to $50,000 $50,001 to $250,000 $250,001 to $500,000 $500,001 to $1,000,000 $1,000,001 to $2,000,000 Over $2,000,000 S U R V E Y Q U E S T I O N S & R E S P O N S E S

21 % of Respondents #5: WHAT IS YOUR ANTICIPATED ANNUAL GROWTH RATE FOR IAAS CLOUD SERVICES 2013 TO 2015? All respondents anticipate IaaS to grow more than 20% from 2013 to % 6-10% 11-15% 16-20% >20% S U R V E Y Q U E S T I O N S & R E S P O N S E S

22 #6: DO YOU CURRENTLY USE SOFTWARE AS A SERVICE (SAAS)? All companies surveyed currently use SaaS. Yes 100.0% No S U R V E Y Q U E S T I O N S & R E S P O N S E S

23 #7: PLEASE INDICATE THE KINDS OF SOFTWARE SOLUTIONS YOU SOURCE THROUGH A SAAS VENDOR. 75% use collaboration and CRM as a software solution they source through a SaaS vendor. 80% 70% 60% 50% 75% 75% 50% 50% Software Solutions Business Intelligence & Analytics Collaboration 40% CRM 30% 20% 10% 0% 18% 25% 25% 25% 25% Demand Generation Documents Management Finance & Accounting Human Resources Social Enterprise Tools Other S U R V E Y Q U E S T I O N S & R E S P O N S E S

24 #8: WHAT IS YOUR ANNUAL SPEND ON SAAS CLOUD SERVICES TODAY? About 44% of respondents only spend $10,001 to $50,000 annually on SaaS, but 25% spend over $2 million. 50.0% 45.0% 40.0% 35.0% 43.8% Annual Spend on SaaS $10,001 to $50, % 25.0% 20.0% 15.0% 18.8% 6.3% 25.0% $50,001 to $250,000 $250,001 to $500, % 5.0% 6.3% $1,000,001 to $2,000, % Over $2,000,000 S U R V E Y Q U E S T I O N S & R E S P O N S E S

25 #9: WHAT IS YOUR ANTICIPATED ANNUAL GROWTH RATE FOR SAAS SERVICES 2013 TO 2015? Approximately 38% of respondents anticipate SaaS services will grow 0% to 5% from 2013 to Annual Growth Rate - SaaS 18.7% 37.5% 0% to 5% 6% to 10% 25.0% 12.5% 6.3% 11% to 15% 15% to 20% Over 20% S U R V E Y Q U E S T I O N S & R E S P O N S E S

26 #10: DO YOU CURRENTLY USE PLATFORM AS A SERVICE (PAAS)? 75% of enterprises surveyed do not use PaaS. 25.0% Yes 75.0% No S U R V E Y Q U E S T I O N S & R E S P O N S E S

27 #11: WHO IN YOUR COMPANY PURCHASES CLOUD SERVICES? While 100% of IT organizations purchase Cloud services, Business Units purchase nearly 59% of cloud services % 100.0% 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 58.8% IT organization Business Units or Functional Departments Not applicable 20.0% 10.0% 0.0% 0.0% S U R V E Y Q U E S T I O N S & R E S P O N S E S

28 #12: ARE YOU CONCERNED ABOUT UNCONTROLLED ACQUISITION OF CLOUD SERVICES BY NON-IT UNITS OF THE COMPANY? More than 56% of respondents are concerned about uncontrolled acquisition of Cloud services by non-it units. 43.8% 56.3% Yes No S U R V E Y Q U E S T I O N S & R E S P O N S E S

29 #13: DO YOU HAVE TOOLS TO ENSURE YOUR COMPANY CAN MONITOR ALL CLOUD ACQUISITIONS? None of the respondents have tools to monitor all Cloud acquisitions % Yes No S U R V E Y Q U E S T I O N S & R E S P O N S E S

30 Visit us online for more information on our Cloud services.

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