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The Mystery of Cloud ROI

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InformationWeek just released the results of their 2014 Cloud ROI Survey. They surveyed 392 technology decision makers at North American companies in July. Of the respondents, 20% were unlikely to evaluate ROI for cloud related projects. Interestingly, they conducted this same survey last year and at that time that number was cut in half, at only 10%.

The report looked in depth at two companies to illustrate the survey results. First, Airbnb, which joins the 20% that have no plans to measure cloud ROI. According to the company’s manager of site reliability engineering, “Right now, we have better things to do.”

Second, GE, which is currently consolidating 34 company-owned data centers down to five, is taking a more active approach to ROI measurement. Through the data center consolidation process, the company is attempting to evaluate which applications it will rearchitect and move into a private or public cloud. How are they doing this evaluation? According to the report, “intense ROI calculations.”

However, GE has had to make decisions about what inputs go into their ROI calculations (read the report for more details) and even these inputs can vary.

So what does this all mean? Why are we seeing such a steep decline in measuring ROI? For the companies that are measuring, why isn’t there a clearly defined universal process to conduct such calculations? Well, the answer is most likely that cloud storage technology is advancing so quickly (Kinetic, anyone?) that many companies cannot keep up. These companies understand the core benefits of the cloud and saving the rest for later.

The benefits of the cloud are many. Technology decision makers recognize the importance of adopting the cloud storage options and are doing so regardless of being able to predict an exact return. Eventually, organizations will catch up and the process to measure ROI will be clearer. In the mean time, they are investing in future success with the information that have. They know there’s a return — they’ll worry about the details, later.