Outsource Magazine

I’m often asked what the future of outsourcing is, and, as difficult as it can be to accurately predict what’s going to happen without using a crystal ball, it’s certainly worth considering the value that cloud computing is able to add.  Back in the cold, dark and rainy days of January I predicted that this year was going to serve as a key driver for growth in the outsourcing space.  As we edge slowly into May, is it fair to ask why we have yet to see the much-vaunted explosion in cloud computing?

Research in the last year from data and advisory firm TPI showed that 78% of all IT decision-makers have held internal discussions about cloud computing – a statistic which does little to explain why so few have decided to take the plunge and invest in the technology already.  There seems very little doubt that some are continuing to give the cloud a wide berth, owing to a number of significant and very real concerns. 

For instance, Amazon’s recent and well-publicised cloud outage, which disabled several popular websites, including Quora, Foursquare and Reddit, served only to heighten concerns over the reliability of cloud solutions.  It’s also true that for many, the idea of their business-critical information physically sitting in a datacentre in a far, remote location, offers them as much assurance around security as the prospect of storing their life savings in a mattress.

For all of this, it’s worth bearing in mind that cloud computing offers a number of benefits, including increased speed and flexibility, as well as reduced hardware costs.  We’ve even seen new software announced recently to enable companies to build their own cloud computing platforms, for clients to use as a web-based interface to install applications, configure databases and set up their own security. 

So should we expect to see cloud computing replacing traditional outsourcing models entirely in the years to come?  It’s clear that more traditional models are constantly being evaluated, and that if it is felt that there’s scope for certain parts of existing outsourced estates to be run better and more flexibly in the cloud, then that will be a consideration.  It seems far more likely to me, however, that the real growth in cloud computing will still be as a complement to existing outsourcing services – it might just take a little longer than any of us expected.

Perhaps, particularly given the struggles faced by Amazon in recent weeks, it’s a stretch to say that industry will be clamouring to take advantage of cloud services this year, as too many concerns over security and reliability remain.  However, as these flaws are ironed out and we see more software and services aimed at broadening the appeal of cloud across industry, it’s clear that it will remain an area for growth.

If you would like to hear more about how to embrace cloud computing as part of your outsourcing solution, the NOA will be holding a monthly seminar on this topic on Tuesday 24th May.  Further details are available here.