Hybrid Cloud is on the rise

Nutanix’s Malaysia Country Manager, Avinash Gowda, talks to Enterprise IT News about cloud take up in the country.

EITN: What is the biggest factor for enterprise private cloud take up in the region and Malaysia?

Avinash: The biggest motivating factor for the acceleration of enterprise private cloud adoption is the need for increased flexibility, with 74 percent of Malaysian respondents saying they looked to gain better control over IT resource usage.

But it’s not only about private cloud in Malaysia.  According to the 2020 Nutanix Enterprise Cloud Index (ECI), private and hybrid cloud adoption in Malaysia outpaced global and APAC averages following the pandemic.  With Malaysian enterprises looking toward business recovery while scaling for innovation and growth, the majority (58 percent) have been prompted to make strategic investments in private cloud, and 51 percent have upped their hybrid cloud investments as a direct result of the pandemic.

While Covid-19 pandemic has been a catalyst for the rise in cloud adoption across Malaysia and the region, Malaysian respondents said they appreciated the increased speed that cloud provided to meet fluctuating business demands, which helped them deliver better support for end customers.

Malaysian respondents said they appreciated the increased speed that cloud provided to meet fluctuating business demands, which helped them deliver better support for end customers.

EITN: What other industries besides FSI are ramping up cloud take up? How are they balancing this with RMIT guidelines which they need to comply with?

Avinash: For the FSI sector, the revised RMIT guidelines from Bank Negara serves to clear up some of the earlier inconsistencies with the Banks’ Outsource advisory. Specifically, it addresses the hurdles to public cloud adoption. However, an overwhelming majority of local financial institutions are now looking to private cloud deployments, particularly due to their greater reputation risk and the need to integrate with existing applications. Now that FSIs have viable choices, they can objectively evaluate and decide on the specific cloud infrastructure that makes the most sense for them. For end-customers facing applications, where latency, transaction processing, regulations and privacy are critical, we are seeing a clear choice made, with Malaysian FSIs like Tranglo and MaxMoney turning to private cloud, and some even repatriating workloads. 

Several other key industry verticals have been ramping up cloud adoption as well, in particular, hybrid cloud. The most important consideration for organizations across sectors has been to shift the needle on their business, driving new operational and cost efficiencies. Hybrid clouds have proven effective in this area – in fact, nearly all Malaysian respondents identified hybrid cloud as the ideal infrastructure for their organizations.

The public sector, for one, is leading the way in cloud adoption. Nutanix has supported private cloud deployments across statutory bodies and ministries, where data security is critical. In the last year, we’ve been working closely with public sector agencies to drive cloud-based applications for the community to aid in contact tracing, electronic booking for health services and analytical data collection, all while ensuring data is kept secure.

The public sector, for one, is leading the way in cloud adoption

The healthcare sector has also seen the importance of cloud. With key healthcare resources being used at capacity, cloud has proven effective in securing digital patient data, delivering improved telehealth services, and streamlining research collaboration with governments, academic institutions and businesses.

Finally, business continuity proved critical to the logistics and manufacturing industry as global supply chains were disrupted – and the cloud was a key tool in helping them remain operational and meet demands. For example, one of Nutanix’ customers, GDExpress, was able to cater to the sheer transactional load volumes at the height of the pandemic by leveraging on private cloud. The elasticity, scalability and security of a private cloud infrastructure enabled the logistics giant to enjoy cost-savings while delivering increased business output.

EITN: Compared to first two ECI reports, are there sudden fluctuations or emergence of new trend in the 3rd ECI report due to the pandemic?

Avinash: The majority of ECI 2020 respondents (76 percent) said that the COVID-19 pandemic has caused IT to be viewed more strategically within their organizations, and 88 perent of Malaysian-company respondents agreed. The pandemic has in many cases influenced IT shops to turn to the cloud for readily available infrastructure that can accommodate larger numbers of work-from-home employees. This was opposed to one year ago when 29 percent of respondents said their organizations had no employees working remotely.

Furthermore, hybrid cloud is the ideal IT operating model for the vast majority of respondents in Malaysia and elsewhere. Nearly all respondents from Malaysia (96 percent) identified hybrid cloud as the ideal infrastructure for their organizations, outpacing those in the APJ region (90 perent) and in the global response pool (87 percent). Malaysian respondents run slightly more hybrid clouds than average today with 14 percent penetration, which will grow to 57 percent in five years.

Another new trend we observed is an increased demand for shifting applications from public cloud to on-premises infrastructure.  The 2020 ECI report revealed this increase could be credited to respondents’ goal to improve security (65 percent) and control over applications (65 percent). More than half (58 percent) said they wanted to improve data access speeds, followed by costs (56 percent).

Another new trend we observed is an increased demand for shifting applications from public cloud to on-premises infrastructure.

Additionally, far more respondents in Malaysia said they are now running more applications in a public cloud (47 percent), as compared to 2019. These are several points higher than the APJ and global averages of 33 percent and 34 percent, respectively.

 EITN: Are the top challenges to cloud adoption still the same this year? If yes or no, what are the top challenges?

Avinash: Most ECI respondents, including those in Malaysia, indicated they are in the process of transitioning to a hybrid cloud infrastructure. Yet for most organizations, transitions don’t happen overnight. Legacy applications may justify keeping older infrastructure for a time, for example, or require re-platforming skills that organizations may not have on hand. The ability to migrate applications to and from private and public clouds, and maintain application mobility across cloud environments is a core hybrid cloud attribute that’s still maturing, so it’s not surprising that this issue appeared on the list of challenges for Malaysian respondents.

Additionally, the ability of enterprises to leverage existing staff and skillsets, as opposed to spending time and resources re-tooling or re-hiring, will add to the ease of migrating cloud solutions. Presently, 42 percent of respondents said migrating applications has gotten easier – higher than the global average of 38 percent.

 EITN: What are the top 3 ways to harness cloud as part of IT infra strategies to drive business growth?

Avinash: First and foremost, businesses need to look at driving focused outcome-driven transformation, which will maximise the return on IT investment and resources. Prolonged effects of the pandemic have meant transformation has been set in motion — as part of that transformation, more organizations are becoming increasingly aware of the benefits of cloud and how it can help manage workloads.

Any infrastructure — public, private or hybrid cloud — needs to be evaluated with financial concerns top of mind and within the context of the organization’s long-term business goals. Organizations should not be seduced by low-cost narratives. Instead, they ought to do their research, and consider various factors (aside from cost) that would ensure their cloud strategies are financially sound, and future-proof. In this way, businesses will be able to manage costs while maximizing outcomes.

Secondly, cloud will provide agility and flexibility for businesses to seek and scale in new markets, coping with large-scale business growth. The cloud gives companies a base from which to improve their services. But there is another foundation to the cloud itself – hyperconverged infrastructure. This is really about making things simple and scalable.

A hyperconverged infrastructure simplifies datacentre modernization and makes it possible to bring together private and public clouds.  This is important when we consider all businesses want to be able to manage multiple clouds seamlessly. An example of a company that we helped modernize its datacenter based on this technology is RBL Bank in India. Building its architecture on Nutanix Enterprise Cloud has helped it make database administration up to 90 percent more efficient. What this means in practical terms is a better-run call centre, faster marketing of services, increased sales of things like credit cards, and much lower customer acquisition costs.

This is important when we consider all businesses want to be able to manage multiple clouds seamlessly

Last but not least, leveraging and running software should be complemented with innovative technologies, such as analytics and artificial intelligence, to improve speed and operational productivity. These technologies are expected to emerge stronger as game-changers as a result of the pandemic, as enterprises lean on them to drive better decision making in the new remote-work-first environment.