Insight

Getting past the cloud plateau

Cloud is now table stakes

Priya Emmanuel

Priya Emmanuel

Managing Director, CIO Advisory, KPMG US

+1 312-665-3052

Corey Jacobson

Corey Jacobson

Managing Director, CIO Advisory, KPMG US

+1 203-927-7274

The 2019 Harvey Nash/KPMG CIO Survey, the largest IT leadership survey in the world, reveals that the scope of cloud continues to grow, with no sign of stopping. Eighty-eight percent of organizations feel more confident about their use of cloud platforms than at any point in the last three years. There is no mystery as to what is driving this adoption and utilization of cloud. These cloud platforms rapidly and dynamically assemble the right technologies to enable a flexible, reliable, scalable, and secure ecosystem.

The cloud adoption plateau

Over the last few years, the highest level of adoption is within SaaS (Software as a Service) and IaaS (Infrastructure as a Service) offerings both acting as initial stepping stones to adopting cloud. Next is an expansion in to PaaS (Platform as a Service) and FaaS (Function as a Service). However, from the onset new sets of challenges arise. It’s what we call the “cloud adoption plateau”―where cloud migration and modernization efforts are stalling after approximately 15–20 percent of suitable workloads have been transitioned. This has generated a lot of discussion at clients and cloud vendors alike, who view this as a major blocker to enabling business transformation via a cloud-based ecosystem.

Stalling can be directly linked to application and infrastructure modernization efforts that are viewed primarily as a technology initiative versus a holistic transformation addressing via functional, capability, and competency changes.

Symptoms of plateau include:

  • Inability to scale and move at market speed with initial migrations
  • Inability to adopt cloud technologies in a consistent manner
  • Security and compliance are perceived as inhibitors
  • Lack of realization of the business case for cloud
  • “Regression” back to on-premises platforms for cloud-suitable demand items.

Plateau is the result of an inefficient and/or ineffective operating model. The adoption, usage, and maintenance of cloud technologies will significantly impact the “ways of working” for IT organizations. To successfully adopt cloud technologies, organizations must evolve their operating model.

Digital leaders avoid cloud plateau by addressing the operating model during the initial migrations

Six keys to operating model transformation

 

1. People and culture – Change the mind-set

Getting past the cloud plateau starts with an organization thinking and acting differently. One of the biggest pitfalls is an organization not addressing behavior change management and training needed to adopt cloud at scale.

Skillsets and roles are evolving to take advantage of cloud platforms and disruptive technologies. A full stack team with highly collaborative engineers, product owners, developers, scrum masters, architects, security, and operations all functioning as a high-performing team. Staff size and roles may change based on the body of work, delivery model, and sourcing strategy.

2. Functional processes – Automate and integrate

Where possible, IT processes are automated and integrated end-to-end to enable secure self-service delivery of cloud services at market speed

Two processes that require immediate attention are security and provisioning processes. Requests for cloud services to orchestrate the provisioning of all the computing, storage, network and security services, and configurations needed via an end-to-end automated workflow that integrates the various steps, policies checks, and approvals needed to get a user productive in an appropriately secure, complaint, and performant cloud environment. Embedding the security controls, service patterns, monitoring, and logging is core to adopting cloud at scale.

3. Service delivery model – Frictionless experience

High-performing IT leaders recognize that IT is increasingly becoming a strategic business partner and profit center to deliver value. The impact of cloud platforms on the service delivery are often understated and overlooked. Successful companies implement a value chain designed to remove friction, promote collaboration, and demand quality in order to meet business expectations.

It provides consumable and reusable services as part of a catalog that reflects the consumption models of cloud provider and not traditional IT (requisition, purchase, install). Successful models are fanatically focused on removing friction points and promoting self-service for users to rapidly get from idea to production. The more an organization moves towards a frictionless service delivery model, the more visibility into consumption and chargeback will be required.

4. Performance insights and data – Deliver measurable value

There must be a shift to a “portfolio manager mind-set” to continually analyze service usage and architectural and cost patterns to identify optimization opportunities to maximize value.  This value-driven approach links to business outcomes using value metrics. These metrics are continuously measured and monitored and enable well-informed decisions to improve performance in rapidly changing cloud environments. 

Dynamic consumption, fluid pricing, and architecture decisions are driving the need for increased transparency and policy-driven control. Actions and decisions made by product and IT teams today have immediate impacts on the bill from a cloud provider, which may not be discovered until next month’s bill. In order for organizations to make informed design and operational decisions, they must have right data at the right time.

5. Technology and tooling – Enable the operating model

A  combination of technology solutions and tools bring to life the operating model in an end-to-end tool chain and cloud architecture. Cloud migration and adoption efforts must implement a flexible tool chain and architectures to accommodate the varying business demand.

Many organizations operate within a “multi/hybrid cloud” with both on premise and multiple cloud service providers that have grown out of ad hoc need, not the result of a technology cloud strategy. It is critical to thoughtfully engage vendors that will shape your technology landscape. Reactionary vendor engagement introduces unnecessary complexity in to cloud ecosystem causing an organization to plateau.

6. Governance – Continuously monitor and advise

Successful cloud adoption depends on a lighter-touch oversight with continuous monitoring linked to built-in controls, compliance, guardrails, and policies providing transparency into decisions, patterns, usage, compliance, and performance.


Executive stakeholders need to reprioritize their commitments and resources. By creating a dedicated business function for cloud transformation, it communicates cloud strategy with objectives and key results. Effective cloud governance encourages collaboration, the pollination of ideas and provides best practice guidance. To that end, governance shifts from saying “no” to “how.”


New ways of working and living in the cloud

Cloud can remove friction and enable a truly connected enterprise―that is customer-centric, digitally enabled, engineered for profitable growth. Cloud demands a major step-change in an organization’s mindset, ways of working, capabilities, and competencies to run securely and efficiently at market speed and scale. Only those digital leaders willing to transform will see long-term value from cloud and avoid the plateau.