Cloud adoption results in reduction of ownership cost for firms


This appeared first on The Peninsula.

Doha: Expedited by the pandemic, businesses have experienced a massive and fast shift towards the implementation of cloud services within their operation models, with global cloud spending increasing by 37 percent in the first quarter of 2020. Industry analyst Gartner, forecast that spending will continue to grow a further 18.4 percent in 2021, reaching $304.9bn by the end of the year. Cloud adoption brings a host of benefits, including reduced costs in the long term, improved service quality, increased flexibility, and competitiveness.

“Qatar’s public and private sectors will immensely benefit from the adoption of cloud solutions. As an initial start, companies might witness an upsurge in their investment when shifting to cloud services, however in the span of five to ten years, the Total Cost of Ownership (TCO) will decrease. The move to the cloud should be viewed as a long-term investment rather than a short-term cost,” Firas Sleiman, Partner and Technology, Digital & Cyber Leader at PwC in Qatar, told The Peninsula.

Sleiman brings over 25 years of experience in the US and MENA regions, focused on leading effective tech and consulting organisations through growth and value generation, solving highly complex business and technology challenges through cross-domain modern IT architecture and digital / data strategies, large-scale technology and cloud transformations, big data analytics and agile product implementations.

Recent studies have suggested that migrating to cloud results in a reduction in the total cost of ownership. “In typical TCO studies we find that the ten-year TCO is massively cheaper. Meaning, that the company starts breaking-even by its third or fourth year and everything after that is considered a cost reduction. If businesses keep the reduction process ongoing, by the tenth year the company will have saved 60-70 percent of its operating cost,” said Sleiman.

Currently, the adoption of cloud services in Qatar’s private sector is below the global average. According to a recent PwC report exploring five challenges to cloud adoption in Qatar and how to overcome them, only 3 percent of Qatar’s private sector has implemented cloud solutions, despite 76 percent of businesses being aware of its benefits.

Sleiman added, “while globally companies are increasingly embracing cloud services, its adoption is at a much slower pace in Qatar’s private sector.” According to Firas Sleiman, setting up a local data center will increase the adoption of cloud-based solutions.

Qatar’s ICT landscape has drastically changed in the past few years with the entry of new global players. Microsoft and Google, the two global tech giants, have already announced their plans for cloud-based solutions in Qatar.

Sleiman advised that for Small and Medium Enterprises (SMEs) that are starting from scratch, it would be more efficient to adopt cloud solutions than to have their own data centres as this will result in a huge upfront cost.

“For SME’s that are 5-10 years old and already invested and running, we recommend that they plan their migration process from the outset. There are parts of the business that can be easily transferable, such as websites or mobile applications. However, with items that are more technically advanced, like ERP solutions, the process becomes more complex and a shift strategy needs to be put in place,” said Sleiman

Sleiman commented that having a data center in Qatar boosts the level of security for local businesses.. If the companies, especially financial institutions, know that they can control access to data in their local data center, then they will be much more willing to invest in cloud services. “Having a data center here will enable local companies to get faster and safer cloud services. They will get better overall service,” he added.

Sleiman concluded the interview by acknowledging that the biggest investment that a CEO or CIO in any company or public sector leader can do, is focus on data. He stated that in the next 10 years, every leader should be thinking of data as an invaluable asset instead of traditional assets such as money, investments or even real estate.

Organisations in Qatar need to work towards embracing benefits offered by cloud-based solutions. There is no doubt that Qatar is rapidly evolving within technology landscape. It is an integral element to keep in mind while considering Qatar’s position as a regional hub for research, innovation, education, healthcare, and technology. PwC expects to see an accelerated uptake of cloud-based solutions by both public and private sector entities in the near future.

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