Kathy Gibson reports – Just about every medium to large enterprise in Africa uses the cloud in one form or another.
This is one of the key findings from the third edition of World Wide Worx’s Cloud in Africa report, which shows cloud use is up from just 50% in 2013 when the study was first carried out.
The cloud is also no longer seen primarily as a backup platform, says Arthur Goldstuck, MD of World Wide Worx.
“Today we see a focus on refining strategic benefits, and moving more applications and data into the cloud where it makes sense,” he says.
The single biggest concern with the cloud remains security, with two thirds of respondents citing it.
Compliance, data integrity and policy consistency is the next biggest concern, although it features far behind security at just one in 10 responses.
The big technology trends we are seeing are artificial intelligence and machine learning (AI/ML), Internet of Things (IoT) and big data – what Goldstuck calls the magic triangle of tech. These three trends are cited by nine out of 10 respondents.
“It is very clear that AI/ML, IoT and big data will be driving technology across the content,” says Goldstuck.
Other popular trends are blockchain (57%) and virtual/augmented reality (49%).
Nigeria and Namibia are the top proponents of AI/ML, at 100% of respondents. Zambia follows at 92% and South Africa at 91%.
IoT and big data are seen as vital in all countries except Zimbabwe, where connectivity is probably an inhibitor, Goldstuck says.
Banking has the least focus on AI/ML, at 76%, compared to insurance and financial services at 97%, manufacturing at 96%, IT at 95% and NGO/NPO at 85%.
IoT is being adopted mostly by the IT sector, at 68%, then banking at 59% and manufacturing at 57%, with financial services and NGO/NPO less so.
Big data is important to insurance and financial services, according to 97% of respondents, then manufacturing at 96%, IT at 93%, NGO/NPO at 82% and banking at 71%.
Accounting is the application most likely to be running in the cloud, at 64%, followed by Office (54%) and general finance applications (48%).
This is very different from 2013, when backup was the most popular cloud application.
“This points to the evolving role of the cloud for realtime productivity,” Goldstuck says. “Particularly in the era of remote working, the cloud has become important.”
Finance apps are seen as critical to the organisation, followed by accounting, HR, marketing, business and backup applications.
“It is not a one size fits all environment. Just because an app is critical doesn’t mean it will be moved to the cloud and vice versa.”
In 2018, only one-third of companies said finance apps were critical, compared to most organisations today. This points to dramatic increase in the importance of the finance function to the company as well as of the cloud platform, Goldstuck says.
Last year 38% of companies increased their spend on cloud. In South Africa, this jumps to 82% of companies. This points to the fact South Africa is the most advanced in cloud, and also to the availability of local cloud data centres.
In Nigeria, by contrast, only half of companies had increased their spend.
Across the continent, 38% increased spend, 59% remained the same, and 1% decreased their spend.
Going forward we will see countries that are close to the data centres, and the fibre connectivity of those centres, increasing their investment in cloud,
The industries increasing spend are banking (53%), manufacturing (46%), IT (32%), insurance and financial services (31%) and NGO/NPO (26%).
Asked about future spending, the 38% that increased spend this year jumps to 61% for next year, with 36% staying the same and 1% still decreasing their spend.
In South Africa, 58% of respondents plan to increase spend next year.
IT and financial services will see the biggest proportion of increased spend going forward.
Asked what impact the cloud has had on various aspects of their business, 40% of respondents report a positive impact on their market share.
The main benefits of the cloud are seen to be business efficiency (63%), agility and flexibility (53%), customer service (45%), time to market speed (37%), cost saving (33%), a platform for services innovation (25%), scalability (25%), and international expansion (21%).
A massive 67% of companies said the cloud had a positive impact on innovation in the organisation.
A positive impact on customer experience was cited by 61% of respondents.
Nine out of 10 respondents said the cloud was important in helping them to cope with the challenges of Covid-19 – and even more for governments.
During the pandemic, cloud was seen as extremely important for 39% of respondents and not important for just 5%.
It helped in disaster recover for 91% of respondents, remote working for 82%, customer service 52%, regular backups (38%), and logistics (35%).
For governments, not a single respondent said it wasn’t important. A massive 47% said it was extremely important, 33% as rising in importance, and 17% as somewhat important.
The cloud assisted governments in remote working by officials (69%), followed by communicating to the public (55%), co-ordinating response (50%), making other government services available (45%) and making government financial services available (42%).
The reason for the low response for government services availability is the fact that government is not cloud-ready, Goldstuck points out. “Government lags the rest of business in the use cloud.”
The cloud has been key to business and government continuity during the pandemic
Cloud deployments and app strategies will fuel efficiency and innovation across all countries.
This year’s Cloud in Africa report was the biggest study yet, with more African countries than ever before, and interviewing 400 IT managers in medium and large companies. It was conducted in July and August 2020. The study was sponsored by F5, DigiCloud Africa and Dell Technologies.