Drawing on the manufacturing-specific responses from a broad IDC survey, this report details the trends surrounding cloud computing in the industry. The report looks at adoption rates, important characteristics, and business benefits and how those factors will impact manufacturing IT budgets in the next two years.
In our 2011 predictions for manufacturing, we discussed the growing business need for dealing with complexity. We noted that survey work indicated that CEOs wanted to "capitalize on" complexity rather than simply reduce it. This wording provided a nuanced but important distinction between unnecessary complication or waste that must be eliminated and the unavoidable complexity of sophisticated products produced in elongated supply networks and sold into global markets. The impact of complexity was further magnified by the volatility of macroeconomic conditions, raw material costs, and consumer confidence.
Capitalizing on complexity in a volatile context requires sufficient information and adept analysis - normally good news for IT investment. However, manufacturing IT organizations established an excellent track record of improving IT productivity in the decade from 2000 to 2009, when IT spending as a percentage of revenue improved some 25%. So the need for new IT capabilities in the complex context is couched in an expectation that productivity improvements will continue. And cloud computing is the most important productivity platform for the next decade.