New Cloud Maturity Index shows: the finance sector in the lead – public sector still lagging behind
- 25.11.2019 09:58 am
Cloud transformation has increasingly become a key enabler for digitalization and realizing data driven opportunities for organizations across the Nordics. Still, only 18 percent of organizations can be considered as cloud mature. When it comes to different industries, the finance sector is in the lead, while the public sector reports the lowest maturity. This is revealed in Tieto’s Cloud Maturity Index. For the first time, environmental considerations are taking a spot on the cloud agendas of many organizations.
This is the fourth edition of Cloud Maturity Index, a Nordic survey conducted by research company Radar on behalf of Tieto. The report shows that the gap between top and bottom performers is widening, where the good are getting better and the bad are standing still. 13 percent of all organizations have not started their cloud journey and can be regarded as cloud “immature”, while most (42 percent) are on a basic level, 27 percent is considered “proficient” and 18 percent are “mature”, the highest level of maturity.
“Cloud services have increasingly become an integral part of effective IT operations across the Nordics. Cloud mature organizations tend to see cloud as a strategic enabler to cope with the dual challenge of optimising costs while at the same time accelerating innovation and new revenues at a faster pace. However, notably few are still using the full potential of cloud services in this way”, says Timo Ahomäki, Head of Cloud Migration and Automation, Tieto.
The financial industry in the lead - public sector reports the lowest maturity
Of the five main industry sectors covered by the survey, the highest aggregated average cloud maturity is found in the financial industry, as was the case in 2015 and 2017. The public sector continues to report the lowest strategic and operational maturity.
“The public sector has also grown more mature but is still lagging behind, partly due to lack of in-house capabilities and some challenges in attracting the right expertise to leverage modern IT production forms and service models. This has become the major obstacle to improvements in cloud maturity”, says Timo Ahomäki.
Environmental considerations on many organizations’ cloud agenda
Roughly one-half of the organizations are already considering the environmental impact, such as energy consumption or CO2 emission, of their cloud strategy. Forty-four percent of cloud mature organizations say that they are considering how their strategy is impacting the environment, while only 14 percent of the immature organizations provide the same answer. When asked if they will start investigating environmental considerations in the future, the share is 26 percent (mature organizations) and 33 percent (immature), while 30 percent and 48 percent respectively state that this is not part of their cloud strategy at all.
Legal jurisdictions and geographical location of data is an issue for many organizations
When asked if legal jurisdiction and the physical location of data is a barrier to using more Cloud services, in average two out of five (38 percent) of all organizations stated that this is the case. This is particularly important for Swedish organizations (49 percent), compared to Finnish (33 percent) and Norwegian (38 percent) organizations.
“The view on data sovereignty is quite polarised at the moment, especially in Sweden, much due to many unclarities and sometimes conflicting recommendations. The public sector’s apparent standstill in Sweden has become the major obstacle to improvements in cloud maturity. With cloud security guidelines in place, Finland is making good progress and is at the forefront of the Nordic public sector”, says Timo Ahomäki.
Other findings in this year’s Cloud Maturity Index:
All industries regardless of country show higher average levels of maturity for every year. Norwegian organizations have increased notably since 2017, and their average strategic maturity has increased by 14 percent, surpassing Finnish organizations.
The highest perceived barriers for deploying cloud services among less mature organisations are” security” and “regulatory demands”. The single greatest potential obstacle identified by mature organisations is “Difficulty of integrating cloud services with the existing portfolio”.
Cloud mature organizations average 20 percent lower costs in IT operations by utilizing the benefits of Cloud services, and the IT spend pool available for innovation is 29 percent larger than that of their less mature peers.
62 percent of mature organizations have a cloud strategy in place for SaaS (software as a service) procurement while only 19 percent of immature organizations do so.