Companies that commit themselves to cloud computing are likely to grow faster and enjoy twice the profit of their non-cloud using rivals, according to a study. The research also indicates that the UK is leading Europe in cloud adoption. However, one critic said there is no evidence that cloud computing creates productivity, or is a consequence of it.
The Exact 2015 SME Cloud Barometer report, an independent study of 2,975 SME leaders in the UK, the USA, France, Germany, the Netherlands and Belgium, found a correlation between companies with three or more cloud products and revenue growth. The ‘heavy users’ of cloud achieved higher revenue growth and over twice the profit of their less committed cloud users.
Penetration of cloud computing in the UK is relatively high in comparison with its European peers, according to the study. The UK has the second highest number of ‘heavy’ cloud software users (27 per cent) behind the USA on 29 per cent. However, the Netherlands, Belgium and France were not significantly behind, with their rates of cloud adoption being 25, 24 and 24 per cent respectively. Germany, with a cloud adoption rate of 10 per cent, was more significantly behind.
Nearly half (47 per cent) of the UK sample of small and medium sized enterprises SMEs now use at least one cloud business software tool.
The study examined the correlation between growth and cloud adoption and found that on average those companies it defined as heavy users enjoyed revenue growth of 26 per cent in 2015. In comparison the companies that used only one or two cloud computing systems grew revenues by an average of 14 per cent. Those with no cloud systems at all showed the slowest growth rates, with revenues on average growing by 10 per cent.
Of the UK sample, the most popular reason given (by 54 per cent of the survey) for adopting new cloud systems was that the ‘need to replace outdated versions’. Saving money on IT was the most frequently cited motivation for cloud computing among UK SMEs. Getting better access to information was the third most important criterion for cloud.
Erik van der Meijden, CEO of study sponsor Exact, claimed that most SMEs see it as a strategic purchase. “[They] said they felt that technology is going to have a strong impact on the competitive landscape in their market over the next three years,” said Meijden.
However, analyst Clive Longbottom, principal researcher at Quocirca, said the link between cloud and productivity needs more definition. “Causality is something that doesn’t seem to be taken into account here,” said Longbottom, “slow-thinking companies that are performing badly are unlikely to be at the leading edge of technology. Those that see technology as a core part of their business will tend to perform better.”
Cloud business users grow faster and are twice as profitable says study