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Innovation in the cloud

Prioritizing data security and privacy processes

Organizations with adequate data security policies and processes for cloud-based services are able to unlock more innovation and boost experimentation.

January 10, 2018

Companies use cloud-based IT1 not just to cut costs and increase efficiency, but also to innovate faster. Deloitte’s recent everything-as-a-service (XaaS) study revealed that cloud-based IT enables organizations to access cutting-edge technologies and capabilities more easily and inexpensively.2 Companies are 2.6 times more likely to prefer acquiring advanced innovation capabilities, such as artificial intelligence (AI), as cloud services rather than via traditional IT, and three times more likely to prefer services to building these capabilities from scratch.

But what’s the elephant in the room? Data security and privacy concerns. Large volumes of high-quality data are essential in creating insights from advanced technologies such as AI. However, “data security and privacy concerns” was reported as the top obstacle to adopting cloud-based services. Whether the data to be analyzed resides in a single cloud, across multiple clouds, or in a hybrid environment of clouds and on-premise systems, data security and privacy should be looked squarely in the eye and systemically addressed before innovation can truly flourish.3 And companies should also manage operational risk and compliance, for example, by adhering to national data protection and privacy regulations that govern where customer data must be stored.4

Organizations that have established solid data security for their cloud efforts are 1.3 to 2.2 times more likely than other organizations to entrust the cloud with sensitive data relating to employees, customers, and their organization’s intellectual property and finances. Better cloud security seems to come from experience: 61 percent of companies that have used XaaS for less than a year believe they have adequate processes and policies in place to deal with data security for cloud-based IT. This jumps to 79 percent when we consider companies that have been using XaaS for five years or more.5

Companies that have well-thought-out and well-managed cloud data security policies can be in a better position to maximize their use of cloud services for innovation. These organizations are more likely to report that XaaS has helped their organization rapidly develop new products and services, prototype and experiment with novel solutions, reinvent business processes, and even invent new business models.

Accelerating agility with everything-as-a-service

IT providers are shifting from traditional models to XaaS flexible consumption models

How to make a company more agile? Increasingly, enterprises are moving from traditional purchasing of technology to everything-as-a-service. Our new survey shows how companies are benefiting from XaaS—and where they’re struggling.

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Endnotes

We use “cloud-based IT,” “everything-as-a-service,” “XaaS,” “cloud,” and “cloud services” interchangeably to refer to all kinds of enterprise IT consumed as-a-service, e.g., Infrastructure-as-a-service, platform-as-a-service, software-as-a-service, and advanced innovation capabilities provided as-a-service. Whether the IT is provided via private cloud or public cloud, the common thread is that products and services are paid for based on usage—as opposed to the traditional IT model that involves an up-front purchase or licensing.
The Deloitte 2018 flexible consumption models study surveyed 1,170 IT and business professionals from US-based companies that consume 15 percent or more of their enterprise IT as-a-service. See: Gillian Crossan, Susanne Hupfer, Jeff Loucks, and Gopal Srinivasan, “Accelerating agility with everything-as-a-service,” Deloitte Insights, Sept. 17, 2018.
David Linthicum, “Why cloud security should be systemic, and is often not,” Deloitte, April 10, 2018.
Phill Everson and Stephen Bonner, “Maintaining control in the cloud: Developing and managing an effective cloud strategy,” Deloitte, July 2018.
Crossan, Gillian, et al., “Accelerating agility with everything-as-a-service.”

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