Legacy Technology and Lack of Skills Hindering Digital Transformation and IT Modernization
As organizations look to transform their business operations and revolutionize customer service, Digital Transformation (DX) is at the top of most CXOs’ agendas; in fact, DX spending is expected to approach $7.4 trillion between 2020 and 2023, a CAGR of 17.5 percent. However, according to the latest industry data released today from Veeam® Software almost half of global organizations are being hindered in their DX journeys due to unreliable, legacy technologies with 44 percent citing lack of IT skills or expertise as another barrier to success. Moreover, almost every company admitted to experiencing downtime, with 1 out of every 10 servers having unexpected outages each year — problems that last for hours and cost hundreds of thousands of dollars – and this points to an urgent need to modernize data protection and focus on business continuity to enable DX.
The Veeam 2020 Data Protection Trends Report surveyed more than 1,500 global enterprises to understand their approach toward data protection and management today, and how they expect to be prepared for the IT challenges they face, including reacting to demand changes and interruptions in service, as well as more aspirational goals of IT modernization and DX.
The Criticality of Data Protection and Availability
Respondents stated that data delivered through IT has become the heart and soul of most organizations, so it should not be a surprise how important “data protection” has become within IT teams, including not just backing up and restoring data, but also extending business capabilities. However, many organizations (40 percent) still rely on legacy systems to protect their data without fully appreciating the negative impact this can have on their business. The vast majority (95 percent) of organizations suffer unexpected outages and on average, an outage lasts 117 minutes (almost two hours).
Putting this into context, organizations consider 51 percent of their data as ‘High Priority’ versus ‘Normal’. An hour of downtime from a High Priority application is estimated to cost $67,651, while this number is $61,642 for a Normal application. With such a balance between High Priority and Normal in percentages and impact costs, it’s clear that “all data matters” and that downtime is intolerable anywhere within today’s environments.
DX and the Cloud
Enterprises know they must continue to make progress with their IT modernization and DX initiatives in order to meet new industry challenges, and according to this report’s feedback, the most defining aspects of a modern data protection strategy all hinge upon utilization of various cloud-based capabilities: Organizations’ ability to do disaster recovery (DR) via a cloud service (54 percent), the ability to move workloads from on-premises to cloud follows (50 percent), and the ability to move workloads from one cloud to another (48 percent). Half of businesses recognize that cloud has a pivotal part to play in today’s data protection strategy; and it will most likely become even more important in the future. For a truly modernized data protection plan, a company needs a comprehensive solution that supports cloud, virtual and physical data management for any application and any data across any cloud.
Other highlights of the Veeam 2020 Data Protection Trends Report include:
- The No. 1 challenge that will impact organizations within the next 12 months is cyber threats (32 percent). Shortage of skills to implement technology (30 percent) and meeting changing customer needs (29 percent) were also cited as key hurdles in the next 12 months.
- Lack of staff to work on new initiatives (42 percent) was cited as the most impactful data protection challenge organizations currently have. Lack of budget for new initiatives (40 percent) and lack of visibility on operational performance (40 percent) were also cited.
- Over half (51 percent) of respondents believe DX can help their organization transform customer service. Almost half said it could transform business operations (48 percent) and deliver cost savings (47 percent).
- Almost one-quarter (23 percent) of organizations describe their progress towards achieving DX initiatives and goals as mature or fully implemented.
- Almost a third (30 percent) of organizations are currently in the early stages of implementing or planning DX.
- Over a third (39 percent) of respondents said the ability to improve reliability of backups is the most likely reason to drive their organization to change its primary backup solution. 38 percent cited reduced software or hardware costs and 33% said improving return on investment.
- Almost a quarter (23 percent) of organizations’ data is replicated and made business continuity (BC)/DR capable via a cloud provider. Over a fifth (21 percent) of data across organizations globally is not replicated or staged for BC/DR.
- Over a quarter (27 percent) of organizations’ data is backed up to the cloud by a Backup as a Service (BaaS) provider. 14 percent of data across organizations globally is not backed up.
- Over two in five (43 percent) organizations plan to leverage cloud-based backup managed by a BaaS provider within the next two years.