Rapid pace of IT decentralization costs Indian companies dearly: VMware study

BANGALORE, INDIA: IT departments are being sidestepped by business leaders who adopt their own cloud-based technologies to innovate faster and meet growth objectives. At the same time, IT departments are left to shoulder responsibility for things that go wrong. This was one of the key finding of a VMware study -The State of the Cloud 2016 conducted by Vanson Bourne.

The study addresses one of the most significant impediments to digital business innovation in India: the decentralization of IT and its detrimental effect on enterprise operations.

The research found that enterprises in India face high levels of IT decentralization, with more than 80 per cent of local respondents – one of the highest in the Asia Pacific and Japan region – agreeing that the management and procurement of IT are taking place outside of IT’s purview, and driving up company costs.

Line of business leaders feel that IT is not moving fast enough to support the business and its drive for innovation. This has given rise to decentralization and multi-cloud adoption, with line of business leaders in local firms purchasing an average of eight additional cloud services without consulting their IT departments – the highest in the Asia Pacific and Japan region.

The findings point towards the pressing need for IT to adopt a common operating environment for all clouds to mitigate complexities, inefficiencies and security risks, and more importantly, simultaneously enable innovation.

Overall, the research reinforced that decentralization is causing IT’s job to become more challenging, by introducing a shift in expectations on how they should be supporting the business.

“The research results validate what we've been hearing from our customers – most organizations have a hybrid cloud environment, with workloads and applications across different platforms,” said Arun Parameswaran, managing director, India, VMware. “The challenge for local CIOs is to continue enabling their companies to innovate and meet growth objectives, and yet effectively manage and secure applications dispersed across multiple cloud environments.”

Some highlights from the study:

-IT decision makers and line of business leaders across India agree the purchasing (83 per cent) and management (80 per cent) of IT within their organizations such as applications, hardware and cloud services, has become increasingly decentralized in the past three years.

-Majority of respondents believe the decentralization of IT gives the business more freedom to drive innovation (80 per cent); increases responsiveness to market changes (86 per cent); enables them to launch new products and services to market more quickly (85 per cent); and helps to attract better talent (78 per cent).

-However, many respondents also indicated that the decentralization of IT has led to the purchasing of non-secure solutions (73 per cent); applications being developed outside of corporate or government regulations (77 per cent); and a lack of regulatory compliance for data protection (69 per cent).

-83 per cent of respondents feel that the IT department should be responsible for driving innovation across the organization, and currently there is lack of clear ownership and responsibility for IT within their organization (69 per cent).

-Almost half (47 per cent) of respondents agree or strongly agree that the IT department has had no control over the decentralization of IT.

-86 per cent of Indian IT decision makers and line of business leaders indicated that cloud computing has made it easier for lines of business to purchase their own IT. This has led to an average of eight additional cloud services being purchased outside of the IT department per organization.

-80 per cent of IT decision makers and line of business leaders in India indicated that the decentralization of technology is increasing costs or spending within their organizations.