Cloud - The Cost Containment Strategy

I love this data, which comes from ESG's 2012 IT spending intentions survey (we've been doing this for years, so we have some excellent tracking data). This survey covers North America, Western Europe, and the Asia Pacific region.

In 2009, people were 3X more likely to cancel an IT project, or cut headcount to contain costs then they were to use cloud services.

By 2011, folks were just as likely to consider implementing a cloud solution to contain costs as they were to kill a project or fire people.

2012 data tells us that we've crossed the chasm - people are now MORE likely to use cloud techniques as a cost containment/reduction strategy then they are to shoot a project or get rid of people.

This, my friends, is a tipping point. (How many more book themes will I steal in this blog, I wonder?)

Cost reduction/containment is by far the most important catalyst to a long term, thriving market opportunity. Always. Strategic value (i.e., making money on your decision versus saving money by your decision) is always secondary. Always.

Thus, we can now assume that cloud has moved mainstream - and will only accelerate. As soon as a market accepts you as a valid cost containment/reduction strategy, you are invited backstage, where the deals happen.

So, what's that mean? Markets become interesting when the status quo is upset. The status quo likes things, well, to stay the same. The same being "you give me money, I spend it. You bitch about it, then you give me more money." Something that derails that flow tends to upset those on the receiving end.

So as more and more people adopt cloud-based strategies (initially) to cut costs, who among the status quo will be negatively affected? Want to know how to figure it out in your own shop? See which sales guys start coming around way more often than normal. See how many times they call you "Buddy!" lately. Those are the ones at risk. Those are the ones who will react in violent opposition (overt or covert) to your move to the cloud.

Those are the ones who will adapt (quickly) or perish (slowly and painfully).

Game on!

You can read Steve's other blog entries at The Bigger Truth.

Topics: IT Infrastructure Cloud Services & Orchestration