UK PLCs shift to mobile and cloud, says SAP study

CIO study shows on-premise still no1 but indicates major shift towards on device and on demand solutions

Birmingham, UKOrganisations are moving towards cloud and mobile solutions as they recognise the cost and business benefits of running applications on-demand and on-device. Those are the findings of a new survey of CIOs in 250 UK PLCs with 1,000 employees or more conducted by SAP.

The findings show that over the next five years UK companies will gradually shift towards a mixture of running their applications on-demand, on-device and on-premise.

On premise looks set to continue to be the primary software model, with 61% of new software investments being in on-premise over the next 12 months, and companies still favouring the benefit of total control it provides. However as companies gain confidence in cloud and users push for greater flexibility, investment in on-device and on-demand models will increase.

Fig.1: Current, ideal and projected splits across deployment models:

  Current split Ideal split Planned split
12 months
from now
Planned split
24 months
from now
Planned split
3-5 years
from now
On Premise 71% 47% 66% 62% 51%
On Demand 17% 31% 19% 21% 28%
On Device 13% 22% 15% 17% 21%

Tim Noble, Managing Director at SAP United Kingdom & Ireland commented: “The shift to on-demand and on-device software is indicative of businesses’ need for faster deployment, access to real-time data, and improved performance. It is also led by demand from the end user who increasingly wants access to business critical applications on the go. From this research it’s clear that over the next five years we are going to see British companies favouring a hybrid approach to software. On-premise will still play a key role but we will see rapid growth in on-demand and on-device solutions. At SAP we are well set up to provide our customers with the choice and flexibility they need, offering a mix of on-demand, on-device and on-premise solutions.”

Growth of cloud
The switch to on-demand or cloud models is being driven primarily by scalability (cited by 62% of respondents). Speed of deployment, cost savings and environmental benefits were also mentioned as key benefits driving the uptake of on-demand. Perhaps slowing down the shift to on-demand are security issues, with 53% of respondents citing this as the biggest barrier to adopting on-demand. A third also said that they remained unconvinced or thought that the benefits of cloud were not yet proven.

Going mobile
When asked about the drivers for growth in on-device solutions, employees demanding more flexibility was cited as the number one driver of adoption. With 72% of organisations anticipating that over a tenth of their workforce will be mobile in 3-5 years’ time, compared to just under half today, it is perhaps no surprise they are starting to invest in on-device solutions. However, despite the hype around the iPhone the clear choices for the business mobile worker are still the laptop and the Blackberry.

Tablet computing set to change the game
The iPad has already made a significant impact with 7% of mobile workers using it for business despite it only being three months old. This suggests it is establishing itself as a tool for business much faster than the iPhone which is only used by 33% of mobile workers.

“The conventional desktop PC is becoming more and more an old topic of conversation as users switch to other devices such as smartphones and tablet PCs. As a result we’re seeing increased interest in on-demand and on-device models which allow people to access information and data wherever they are and whenever they want. At SAP we are investing heavily to ensure we provide our customers with deployment choice and flexibility. In particular with on-device we are greatly extending the reach of SAP software to many more users and deliver applications for the business and technical user on many mobile devices. We believe that with SAP’s OnPremise, OnDemand, and OnDevice product strategy we are creating new opportunities for our customers to build value and capitalise on changing market conditions.” added Noble

(*) SAP defines business software as comprising enterprise resource planning, business intelligence, and related applications.

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i Mobile workers were classified as employees who work remotely from home or outside the office at least once a week