Cloud and outsourcing set to rule IT
A global survey of 550 senior IT executives has uncovered signs of a massive shift from in-house IT to outsourced and cloud services.

The survey was commissioned by IT services company Savvis and conducted by technology marketing consultancy Vanson Bourne. 550 CIOs, IT directors, VPs of IT and senior IT managers of organisations in the USA, Canada, UK, Germany, Japan, Hong Kong and Singapore were interviewed.
The report concluded: “We’re on the cusp of a major shift in IT infrastructure models. This shift ultimately leads to the outsourced cloud as the dominant model. However the journey will take almost five years.” It was clear from responses that the move to cloud is accelerating: 68 percent of the respondents using cloud had implemented their cloud service only in the last 12 months.
Commenting on the findings Savvis CMO, Becky Carr, said: “For years now mainstream adoption of the outsourced cloud has moved closer to reality. ... However the real news from this year’s survey of IT leadership is that enterprises are more immediately concerned with strategically shifting IT infrastructures from an in-house to an outsourced model. Within just five years, 70 percent of all IT infrastructures will be outsourced. This is a dramatic shift, and it’s huge.”
She continued: “IT leaders are balancing issues like security, uptime, loss of control, and company culture with their desire to outsource increasingly large portions of their infrastructures. Significant numbers of respondents said that, although functions such as disaster recovery, facilities and business applications were currently managed in-house, they belonged in an outsourced model.”
Cost reduction or containment was the main reason cited for outsourcing, by 42 percent of respondents. However the report said: “CIOs are no longer under duress to slash costs as a business survival tactic. Rather, IT leaders are looking for better cost structures to provide their businesses with competitive advantage. In fact, 36 percent of organisations see improved quality of service from outsourcing versus in-house solutions.”
The survey found that there is still reluctance to outsource business critical applications. “When asked about their strategic IT goals ... senior IT decision makers still put controlling costs on top of the list — but only barely. Almost as many IT leaders said focusing resources on business-critical applications was a priority.”
Outsourcing of business-critical applications is likely to become much more popular. There is a growing school of thought in IT that says business-critical applications should be outsourced or moved to the cloud where security and reliability can be guaranteed because although applications like email, IP telephony, etc are business-critical they are not significant differentiators and moving these to the cloud or to outsourcers freeing IT resources to work closely with the business and to concentrate on IT applications that differentiate the business and give it a competitive advantage.