Kozup:  fresh approach

Kozup: fresh approach

Manufacturing adopts hybrid cloud

Manufacturing organisations are ‘aggressively’ adopting new technology to embrace modernisation instead of getting left behind with legacy systems, shows a new study

July 2019

The manufacturing industry is adopting hybrid cloud solutions at a rapid rate, according to a new report by Nutanix, a leading enterprise cloud computing company.

The company’s Enterprise Cloud Index looked at manufacturing companies’ plans for adopting private, public and hybrid clouds. According to the results, the industry’s hybrid cloud usage and plans outpace the global average across other industries. The findings show manufacturing leaders are `aggressively’ adopting new technology to embrace modernisation instead of getting left behind with legacy systems. The report states that the distributed cloud model offers a solution that delivers speed, flexibility, and localisation, allowing manufacturers to improve efficiency without compromising quality.

The deployment of hybrid clouds in manufacturing and production companies has currently reached 19 per cent penetration, slightly ahead of the global average. However, manufacturers plan to more than double their hybrid cloud deployments to 45 per cent penetration in two years; outpacing the global average by 4 per cent, the findings revealed.

While 91 per cent of survey respondents reported hybrid cloud as the ideal IT model, however, global average hybrid cloud penetration level is still at 18.5 per cent only. The report states that this is largely due to the disparity in part to challenges of transitioning to the hybrid cloud model. Manufacturing industries reported barriers to adopting hybrid cloud that mirrored global roadblocks, including limitations in application mobility, data security/compliance, performance, management and a shortage of IT talent. Compared to other industries, manufacturers reported greater IT talent deficits in AI/ML, hybrid cloud, blockchain, and edge computing/IoT.

Of the manufacturers surveyed, 43 per cent are currently using a traditional data center as their primary IT infrastructure, slightly outpacing the global average of 41 per cent. However, manufacturers currently use a single public cloud service more often than any other industry. More precisely, 20 per cent of manufacturing companies reported using a single cloud service, compared to the global average of 12 per cent. This indicates that manufacturers are beginning to turn to the cloud as a solution, given that they deal with legacy IT systems and cannot handle workloads on-prem, the report states.

Manufacturers are also advancing the movement to private cloud with 56 per cent of manufacturers surveyed said that they run enterprise applications in a private cloud, outpacing the global average by 7 per cent.

One key challenge for manufacturers adopting cloud solutions is maintaining control over IT spend. Organisations that use public cloud spend 26 per cent of their annual IT budget on public cloud, with this percentage predicted to increase to 35 per cent in two years’ time. Most notable, however, is that more than a third (36 per cent) of organisations using public clouds said their spending has exceeded their budgets.

Another key finding of the report is that manufacturers chose security and compliance slightly more often than companies in other industries as the top factor in deciding where to run workloads. The bullish outlook for hybrid cloud adoption globally and across industries is reflective of an IT landscape growing increasingly automated and flexible enough that enterprises have the choice to buy, build, or rent their IT infrastructure resources based on fast transforming application requirements.

On the whole, the report shows the manufacturing industry is at an “innovation impasse,”   meaning that while manufacturers have a desire to innovate and drive transformation, but legacy IT systems have the potential to constrain their ability to do so.

The opportunity for manufacturers to embrace digitisation efforts including “Industry 4.0” initiatives can break the impasse, but executives must focus on new opportunities to create value and not only prioritise traditional business operations, the report suggests.

Manufacturing organisations face the constant challenge of trade-offs, being under pressure to meet productivity and operational goals in an increasingly global and highly competitive marketplace while also striving for future growth.

This challenge has created a demand for new technology solutions that can help balance the trade-off between current and future goals, the report states.

IT leaders in the manufacturing sector must avoid the beaten path of finding short-term fixes for increasing revenue and instead look to long-term solutions that enable automation, enhanced use of data and improve the customer experience, it said.

“Manufacturers are investing in modernising their IT stack, and adopting industry 4.0 solutions to keep up with ever-changing business demands in areas like production and supply chain management,” said Chris Kozup, SVP of Global Marketing at Nutanix.

“A hybrid cloud infrastructure gives manufacturers a fresh approach to modernizing legacy applications and services, enabling manufacturing IT leaders to focus on their long-term investments in big data, IoT, and next-generation enterprise applications.

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