The benefits and pitfalls of the race to cloud computing

In just 12 months since the pan­dem­ic hit, use of the cloud for busi­ness has soared. Accord­ing to the 2021 Hybrid Cloud Report from NTT, 94 per cent of deci­sion-mak­ers across 13 coun­tries saw it as crit­i­cal to meet­ing imme­di­ate busi­ness needs amid COVID-19 uncer­tain­ty.

The research found 61 per cent of organ­i­sa­tions glob­al­ly were already using or pilot­ing hybrid cloud, a mixed infra­struc­ture of on-premise, pri­vate ser­vices and a pub­lic cloud.

There’s no doubt that, with­out this tech­nol­o­gy and the tools to speed up or scale its adop­tion, the surge in remote work­ing would not have been pos­si­ble. 

Cloth­ing retail­er Mata­lan, for exam­ple, was able to take advan­tage of the cloud for busi­ness pos­i­tives. 

Head of logis­tics Paul Kee explains how it was able to scale its cloud-based ware­house man­age­ment sys­tem (WMS) when its high-street and retail-park doors shut. 

“When the pan­dem­ic hit and stores closed, Mata­lan accel­er­at­ed its ecom­merce capa­bil­i­ty, quick­ly turn­ing a plan into real­i­ty and enabling sales despite sig­nif­i­cant lim­i­ta­tions,” he says. 

“The upgrad­ed cloud-based WMS enabled Mata­lan to adapt process­es and split the pick face between retail and ecom­merce, ulti­mate­ly giv­ing bet­ter con­trol over replen­ish­ment and reduc­ing the fre­quen­cy of run­ning a replen­ish­ment process. This had the knock-on effect of reduc­ing ‘out of stocks’ and improv­ing speed to mar­ket on ecom­merce orders due to more advan­ta­geous cut-off times.

“With ecom­merce grow­ing more than 25 per cent per annum, the abil­i­ty to cater to cus­tomer expec­ta­tions was para­mount to ensur­ing excep­tion­al buy­ing expe­ri­ences. In large part as a result of Man­hat­tan Asso­ciates’ cloud-based WMS, Mata­lan was able to gain improved data avail­abil­i­ty and stock vis­i­bil­i­ty, empow­er­ing bet­ter and quick­er deci­sion-mak­ing, allow­ing us to offer cus­tomers more flex­i­ble, online deliv­ery options.”

How smaller companies increased cloud for business use

Anoth­er com­pa­ny own­er to reap cloud for busi­ness rewards was Tim Penis­ton-Bird, of cus­tomer loy­al­ty agency Orang­utan, and train­ing and events com­pa­ny The Holt. He explains how cloud real­ly came into its own when COVID struck, espe­cial­ly when using it to deliv­er the­o­ry lessons remote­ly to atten­dees quick­ly and effec­tive­ly.

“The pan­dem­ic has increased peo­ple’s com­fort with online activ­i­ty so a larg­er amount of con­tent will move into the cloud,” he pre­dicts. “We are increas­ing­ly look­ing to use vir­tu­al envi­ron­ments and a mix­ture of team tasks and arti­fi­cial intel­li­gence avatars to boost learn­ing where peo­ple can prac­tise approach­es in a safe online envi­ron­ment.”

And this sit­u­a­tion is clear­ly not uncom­mon. Accord­ing to Twil­io’s State of Cus­tomer Engage­ment Report, which sur­veyed 2,500 enter­prise deci­sion-mak­ers glob­al­ly, 89 per cent of the 300 UK busi­ness lead­ers sur­veyed report­ed that COVID-19 had accel­er­at­ed their move to the cloud.

A key rea­son was to give cus­tomers a greater num­ber of dig­i­tal routes to engage. Before the pan­dem­ic, UK respon­dents to the research had said less than half (48 per cent) of their organ­i­sa­tion’s cus­tomer engage­ment was dig­i­tal. Now that has increased to 62 per cent. Four in ten also sug­gest­ed rev­enue would be lost if their cus­tomer engage­ment was not dig­i­talised. 

Penis­ton-Bird expe­ri­enced this first hand. “Dur­ing this peri­od, we increas­ing­ly inte­grat­ed much more of the cus­tomer expe­ri­ence into cloud sys­tems. For exam­ple, in a cus­tomer loy­al­ty pro­gramme for a hous­ing asso­ci­a­tion, requests to area co-ordi­na­tors can be entered, logged and answered with­in a sys­tem, peo­ple can book gas safe­ty inspec­tions, vol­un­teer, make sug­ges­tions or com­plete engage­ment sur­veys,” he says.

Security and backup are still cloud for business concerns

How­ev­er, it has not all been plain sail­ing. Research by Unit 42, a glob­al cyberthreat research arm of Palo Alto Net­works, sug­gest­ed the rush to cloud com­put­ing has allowed secu­ri­ty vul­ner­a­bil­i­ties to pro­lif­er­ate, often because admin priv­i­leges were not strin­gent enough. 

This meant any hack could risk sen­si­tive data being leaked and Unit 42 even found new cloud infra­struc­ture was being hijacked to secret­ly gen­er­ate cryp­tocur­ren­cy. It claimed at least 23 per cent of organ­i­sa­tions glob­al­ly that main­tain cloud infra­struc­ture were affect­ed by  so-called cryp­to­jack­ing.

Along­side secu­ri­ty con­cerns, the resilience of infor­ma­tion in the cloud has also been a crit­i­cal con­sid­er­a­tion. Stor­age­Craft research found 61 per cent of organ­i­sa­tions had increased invest­ment in cloud back-up use and 28 per cent also imple­ment­ed data recov­ery plans that relied on the cloud. 

For many though, the pan­dem­ic has sim­ply speed­ed up use of cloud for busi­ness, a grow­ing need they were already in the process of adopt­ing any­way. 

Mike Hamp­son, chief exec­u­tive at Bish­ops­gate Finan­cial, who increased its cloud use to ser­vice the needs of his 45 col­leagues, says: “The pan­dem­ic accel­er­at­ed that jour­ney, espe­cial­ly when organ­i­sa­tions piv­ot­ed indus­try-wide to work­ing from home, ful­ly embrac­ing cloud-based col­lab­o­ra­tion tools. 

“Also, with per­son­al inter­ac­tion severe­ly cur­tailed, all our clients fol­lowed suit, renew­ing their dri­ve to pro­vid­ing cloud-based dig­i­tal solu­tions for their clients.”

Shar­ing a num­ber of lessons he learnt along the way, Hamp­son adds: “A few things should be incor­po­rat­ed into each organ­i­sa­tion’s plans. From the out­set, adopt a mul­ti-cloud strat­e­gy when deploy­ing to ensure resilience. Impor­tant­ly, focus on the cus­tomer jour­ney and expe­ri­ence when devel­op­ing dig­i­tal solu­tions. 

“Addi­tion­al­ly, all too often, age­ing soft­ware and hard­ware plat­forms are main­tained as crit­i­cal or key com­po­nents, severe­ly impact­ing pro­duc­tiv­i­ty and effi­cien­cy. Lega­cy plat­forms and sys­tems should be con­stant­ly pruned and decom­mis­sioned to ensure you don’t end up with lega­cy tech debt.”