A recent eye-opening survey indicated that enterprises use, on average, 461 cloud applications. This figure proved to be 9 to 10 times more than most internal enterprise IT teams estimated. Another survey revealed that 30 percent of file-sharing and collaboration cloud apps were being used outside of IT’s sphere of control. These results paint a startling image of a chaotic cloud atmosphere, where employees in need of solutions fail to adhere to IT policies or, in many cases, are acting in absence of an IT policy.
Because cloud computing relies on sharing processing resources instead of running servers or relying on personal devices to handle computational requests, it continues to garner broad appeal and fast-paced adoption. Another key reason for this growth is the mobility, agility, and cost savings cloud services offer. They are typically accessible from any device or connection and these services require little training, integration and involvement with IT. Our ongoing research and auditing indicates that this exponential increase in cloud computing often happens without the consent of a company’s IT team. For most companies, this lack of control could prove detrimental to the enterprise itself, its clients, and its employees.
During the course of our research, we encountered several companies unaware of the abundance of cloud services they were using. Typical cloud services included Marketo, Qvidian, Salesforce, QuickBase, Dropbox, Rackspace, Amazon AWS and ADP. Each business unit had a different set of cloud services that it needed to run its individual departments inside the larger enterprise. They were sourcing these services on an ad hoc basis and until recently, nobody, including finance, knew to what extent this was negatively impacting the organization.
When I look at this influx of unmonitored cloud activity and widespread confusion, I can’t help but to think of the issues that enterprises experienced with telecom expense management ten years ago. Surely I’m not the first person to make this connection; but I find some comfort in the fact that we have identified the problem and we know how to fix it.
If we were to identify and start to manage the hundreds of cloud services within your four walls, here are a few things we would likely find:
- Unused and unknown licenses
- Multiple contracts with different start and end dates with the same cloud vendors
- Contracts that have never been read or negotiated
- Rates that may not be in accordance with purchase volumes or industry best practices
- Multiple cloud apps across departments with overlapping capabilities and services
These represent only a few of the issues many businesses face right now. In the next blog, we’ll expand on the severity of this situation and discuss the financial implications. Then, we’ll show you how companies can gain visibility into all these services and optimize their cloud use practices to improve efficiencies and increase savings.