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Perspectives

In an anything-as-a-service world, who is driving adoption of cloud-based IT?

The answer depends on whether the company is a 'cloud native' or an 'IT traditionalist'

Seven in 10 companies already view anything-as-a-service (XaaS)¹ solutions as “very important” or “critically important” to their organization’s business success.² And in the next year or two, the share that considers XaaS “critically important” is expected to grow from 16 percent to 25 percent. The recognized business value of anything- or everything-as-a-service is helping to drive the cloud growth story. But, who is driving this push to adopt XaaS solutions within organizations? The answer often depends on the organization’s relationship to the cloud.

August 28, 2019

In companies that aren’t cloud-oriented from the start, information technology (IT) executives and managers play a significant role in driving XaaS adoption

In “cloud-native” companies (firms that were using cloud-based IT from the beginning), the C-suite typically leads the adoption of XaaS. However, in “IT-traditionalist” organizations (companies that started as users of on-premise IT, but are now moving to cloud-based IT services), IT executives below the C-suite often play an important role as XaaS champions, with grassroots experimentation an important catalyst.

For both types of organizations, C-suite roles (chief information officer/chief technology officer, followed by chief executive officer/president) are most likely to drive the organization’s adoption and use of XaaS. Why is the C-suite so vigorously pushing for XaaS? Our research shows that organizations are achieving substantial benefits with XaaS, both in terms of operational efficiency (such as flexibility to control IT capacity, operations, and costs) and business agility (such as access to the newest technologies, accelerated innovation, and faster time-to-market).3

For cloud-native companies, the board is also often a key champion for adopting XaaS. Indeed, for these organizations, the mandate to use cloud-based IT services has been “baked into their DNA” from the start. For IT traditionalists shifting to cloud, the board may be a much less important factor.

However, for IT traditionalists, IT executives below the C-suite—and even IT managers—act as notable champions for XaaS adoption. Indeed, these roles are almost twice as likely to drive the shift toward XaaS compared with cloud-native organizations, according to our research.

Where do organizations find their inspiration for adopting new XaaS solutions? Half of cloud natives and 46 percent of IT traditionalists regard their IT staff’s experimentation with new XaaS products as a top-three impetus. However, IT traditionalists also pay close attention to grassroots experimentation happening outside IT: 50 percent rate experimentation by business users as a top-three catalyst for introducing new XaaS solutions, while 48 percent view experimentation by product development/engineering staff as a top-three driver.

These different sets of XaaS champions and experimenters in cloud-native and IT-traditionalist companies present an opportunity for providers of cloud-based IT services. Through customized engagements based on who is leading the adoption and what spurs it, they can help potential adopters or existing customers see more value in their cloud solutions. Providers that enable easy experimentation of their solutions in specific areas of adopters’ interest can further bolster this utility and appeal. Imagine the positive impact of such a targeted approach in terms of higher conversion of potential adopters or increased usage of cloud-based solutions.

This charticle authored by Sayantani Mazumder.

Endnotes

XaaS refers to all kinds of enterprise IT provided as cloud-based services, such as infrastructure-as-a-service, software-as-a-service, or advanced innovation capabilities provided as-a-service.
Accelerating Agility with XaaS,” Deloitte, September 2018.
Deloitte 2018 Flexible Consumption Models study, “Accelerating Agility with XaaS,” surveyed 1,170 IT and line-of-business professionals from large US companies that consume at least 15 percent of their enterprise IT on a XaaS basis.

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