Enterprising Developments

Payoffs From Cloud Computing Still Up in the Air

Joe McKendrick
Insurance Experts' Forum, December 19, 2011

Cloud computing may seem like a revolutionary force sweeping through the data center, but in reality, it's very, very early in the revolution. Early as in barely making a dent in corporate IT budgets.

CSC just released the results of a survey that would give many carriers pause. Essentially, the survey of 3,645 IT executives found that the typical cost savings seen for a cloud project is less than $20,000.

That's a drop in the ocean for insurance companies that pay ten times that amount on a weekly basis for their IT services and infrastructure.

If it's not the money, what is attracting enterprises to cloud? For many, it's a platform to help support all the mobile devices being brought into organizations.

And there seems to be a positive impact on IT departments as well – only 14 percent of the companies in the survey downsized their IT departments after adopting cloud, while another 20 percent increased hiring to support cloud engagements. Plus, cloud is reported to be helping boost improvements in IT performance, and that's always a good thing. Among the most common improvements, 52 percent of users report increased data center efficiency and utilization, while 47 percent witness lower operating costs post-cloud adoption.

For the notably cautious insurance industry, a wait-and-see strategy toward cloud appears to be the rule. But despite surveys showing the most low-key results – such as the CSC survey mentioned here – there are a lot of compelling reasons why cloud will ultimately be at least part of everyone's technology future.

Joe McKendrick is an author, consultant, blogger and frequent INN contributor specializing in information technology.

Readers are encouraged to respond to Joe using the “Add Your Comments” box below. He can also be reached at joe@mckendrickresearch.com.

This blog was exclusively written for Insurance Networking News. It may not be reposted or reused without permission from Insurance Networking News.

The opinions of bloggers on www.insurancenetworking.com do not necessarily reflect those of Insurance Networking News.

Comments (0)

Be the first to comment on this post using the section below.

Add Your Comments...

Already Registered?

If you have already registered to Insurance Networking News, please use the form below to login. When completed you will immeditely be directed to post a comment.

Forgot your password?

Not Registered?

You must be registered to post a comment. Click here to register.

Blog Archive

With Google Favoring Mobile, Will The Industry Take it Seriously?

Google’s search engine will now will favor mobile friendly content over traditional website content; within the insurance industry, the greatest initial impact is likely to be felt by insurance distributors.

Why Some Technologists Get Cold Feet on Mobile

There are those who believe that favoring one channel or mode over another will lead to even more silos and dysfunction than we already have in many organizations.

Insurance IT Spending and Budgeting Benchmarks

New research from Novarica highlights areas of concern and offers insights on insurers spending and budgeting decisions.

Enterprise Mobilemania Continues Unabated

More than half of companies are spending more on developing mobile applications -- but are they more efficient?

Why Insurers Need More Than a Policy Admin System

For some insurers, not being able to handle the volume of quotes that are being submitted to them means leaving significant money on the table.

The Pitfalls of Using Assembly Line Methods to Create Software

Most of the time, when the business needs IT, it is for custom software development, just like creating a concept car.