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Enterprises Across the Globe Embrace Multicloud Installations in Response to Pandemic

ISG Provider Lens™ report sees companies seeking help from cloud service providers to manage multicloud setups

Enterprises of all sizes are adopting multicloud setups, and they are seeking help from cloud service providers to implement the right cloud strategy for their workloads, according to a new research report published by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

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“Businesses are shifting toward cloud systems that are interconnected, integrated and managed, thus creating a complex hybrid environment”

The ISG Provider Lens™ Public Cloud – Services & Solutions Archetype Report finds enterprises worldwide are increasingly embracing the benefits of moving to the cloud, with a surge in public cloud adoption driven largely by the COVID-19 pandemic. Cloud computing can enable remote working scenarios, and a hybrid work environment is likely to continue after the pandemic subsides, the report says.

Most cloud managed services are now remotely delivered, including transformation and migration of workloads and sales activities, the report adds.

In addition to the pandemic, other factors driving public cloud adoption include enterprise digital transformation initiatives and a focus on cybersecurity, the report says. The adoption of DevOps and security configurations for application migration has gained significant traction, primarily for cloud-native transformation initiatives.

As a result of the surge in cloud adoption, many enterprises are seeking assistance from cloud service providers to manage complex deployments involving multiple clouds that previously functioned independently and now must be integrated, the report says.

“Businesses are shifting toward cloud systems that are interconnected, integrated and managed, thus creating a complex hybrid environment,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research.

Service providers and their clients are leveraging several platforms and tools for cloud operations, the report adds. The use of AI and machine learning has become widespread, and some enterprises are leveraging automation to improve the customer experience and add to their bottom lines.

Although cloud adoption is rising, some companies are hesitant to migrate their critical workloads to the public cloud, due to several reasons, including questions about security and control of data, the report says. Many enterprises are interested in developing new applications in the cloud, however.

The report also sees enterprises looking for ways to control, manage and optimize cloud expenses. Many are finding it difficult to manage their spending due to the complex cloud ecosystem in a hybrid environment. Service providers are addressing this need by helping enterprises manage their cloud costs via FinOps platforms and services.

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Adoption of FinOps principles and frameworks for cloud spending and optimization has increased considerably, and there is a growing partner ecosystem to deliver FinOps services, the report adds.

The ISG Provider Lens™ Public Cloud – Services & Solutions Archetype Report examines five different types of clients, or archetypes, that are looking for public cloud services. The report evaluates the capabilities of 33 providers to deliver services to the five archetypes:

Traditional Archetype: Traditional buyers are slow to accept the relevance of cloud technologies for their computing needs. Their IT environments are made up mainly of mainframe and legacy applications. They have not embraced cloud computing due to regulations, security issues or pure disdain for new technology. However, this archetype is open to learning more about cloud computing benefits and is seeking assistance to assess its computing environment and strategy formulation.

Pragmatic Archetype: Most of these buyers are second- or third-generation outsourcers that have matured in terms of people, processes and practices. They want to engage with multiple service providers in a professional managed services mode. Service providers are required to comply with service-level agreements or business-level agreements and comply with agreed-upon deadlines. In this model, the client no longer micromanages operational aspects and engages with providers to ensure proper monitoring.

Transformational Archetype: Transformational buyers take a strategic view of the entire IT ecosystem. Plans are in place to transform the current IT setup to a cloud environment. However, such clients will not force-fit legacy infrastructure and applications to the cloud if strategic value will not be realized, yet they are willing to take risks to achieve such value. They seek quicker, more closely integrated, and user-friendly applications, platforms and systems. Unlike managed services buyers that look for improvements in processes and systems, transformation-oriented clients want to change their cloud environment.

Pioneering Archetype: Pioneering buyers are early adopters of cloud technologies and follow a “cloud-first” approach. The focus is on using “born-in-the-cloud” applications to leverage cloud-native capabilities for developing applications that are packaged in containers, deployed as microservices and managed on elastic infrastructure through agile DevOps processes and continuous delivery workflows. Next-generation clients are not encumbered by the requirements of legacy operations. They consider IT as a change agent and an enabler of revenue and profit growth. These buyers are highly customer-centric.

Highly Regulated Archetype: For highly regulated buyers, security is the top priority. They strictly adhere to the regulations and compliance guidelines for their industries. These buyers are primarily from the banking and financial services, healthcare, pharmaceuticals, energy, manufacturing and public sector industries—all of which require confidential data to be protected at all costs. They are open to new ways of securing the functionality of applications, including approaches such as DevSecOps and zero-trust security.

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Among the providers ISG evaluated, Capgemini and HCL were named Leaders across four archetypes, and Accenture and TCS were named Leaders across three. Infosys, Rackspace Technology, Tech Mahindra, Unisys and Wipro were named Leaders in two archetypes, and Atos, Birlasoft, Coforge, Cognizant, Fujitsu, Hexaware, LTI, Mindtree, Mphasis, Navisite, T-Systems, UST and Zensar Technologies were named Leaders in one.

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