The Impact of Cloud on Organizational Growth and the Underutilization of Committed Cloud Spend

The Strategic Growth Role of Cloud Computing

According to recent research conducted by Infosys, cloud technology's contribution to organizational growth and transformation significantly outweighs its role in cost-cutting. This paradigm shift emphasizes the cloud's impact as a growth driver being three times more vital compared to its traditional use for cost efficiency. Despite the heavy investment by companies in cloud infrastructures, findings suggest that less than half of the allocated budget is actively being deployed for cloud services.

Insights from Anant Adya on Cloud Investments and Management

Anant Adya, executive vice-president & service offering head at Infosys INFY, highlighted several critical points from the Cloud Radar 2023 report. He discussed that while organizations continue to use cloud for growth by leveraging new technologies like AI to create additional revenue streams, there is a heightened risk of losing control over costs, security, and management as cloud utilization surges.

To mitigate these issues, the report outlines a tripartite strategy: enhancing collaboration between tech experts and business leaders for predictive cost monitoring; ingraining a sound business case within cloud strategies; and adopting a value-centric cloud operating model organized around customer journeys or value streams.

Global Trends in Cloud Spending

Contrary to assumptions of declining expenditure, two-thirds of companies have reportedly increased cloud spending over the past year, with 80% planning to raise their investment further in the next year. This trajectory is motivated by emerging cloud-driven technologies like generative AI, IoT, and 5G, which necessitate expanded cloud capabilities. Infosys INFY has already embraced the trend by implementing MLOps to deploy cloud-native solutions across various platforms, including Azure and Google Cloud Platform GOOG.

The adoption patterns for cloud services point to a diversifying landscape wherein organizations are increasingly using multiple cloud providers. A substantial shift from reliance on a single provider to multiple cloud services has emerged, with 65% of companies now using three to four different cloud services.

Facts from Infosys Cloud Radar 2023

The report provides statistics reflecting the current state of cloud investment and utilization: 67% of companies have increased their cloud spending this year, with 80% intending to raise it next year. However, only 47% of the committed cloud spend is being utilized, indicating inefficiencies in management. The struggle to manage cloud costs is acknowledged by half of the companies, although three-quarters report cloud migration as highly effective.

cloud, growth, investment