Consumer Goods' Drive To the Cloud Continues, Plus 4 Key Trends From Gartner
Cloud usage is almost universal today, but the extent to which companies are migrating into these technologies varies dramatically. With ongoing economic pressure and uncertainty, consumer goods companies are thinking strategically about how to optimize their investment in cloud, data centers, and edge technologies.
What kind of advances can we expect to see in cloud, edge infrastructure, and data centers? In recent research, Gartner forecasts that, by 2026, 75% of organizations will adopt a digital transformation model predicated on cloud as the fundamental underlying platform, with worldwide public cloud end-user spending predicted to reach nearly $600 billion in 2023. Speaking at the IT Infrastructure, Operations & Cloud Strategies Conference in Sydney, Gartner analysts took these ideas further, outlining four main cloud and data trends to track in the upcoming years.
Gartner expects this year to mark a time of refocusing rather than realizing grand cloud ambitions, particularly given the current economic climate and ongoing uncertainty. “In every crisis lies opportunity, and in this case, the chance to make positive changes that may be long overdue,” shared Paul Delory, VP analyst at Gartner.
4 Cloud Trends to Watch
1. Optimizing (Rather than Adopting) Cloud Usage
Gartner points out that cloud usage in some form or another is already a common practice across industries, and that the focus for I&O teams this year is to rethink any ad hoc or “hastily assembled” cloud infrastructure “to make it more efficient, resilient, and cost-effective.” Henkel is one company that has consolidated the more piecemeal approach, recently announcing it would replace its existing ERP applications with a new S/4HANA software solution, as well as migrate all on-premise, in-memory data centers to the cloud.
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2. New Infrastructures For New Advances
Gartner researchers say I&O teams will be stretched to meet demand with new types of infrastructure, particularly edge infrastructure for data-intensive use cases, non-x86 architectures for specialized workloads, serverless edge architectures, and 5G mobile service. Gartner estimates that 15% of on-premises production workloads will run in containers by 2026 – jumping from less than 5% in 2022. “Don’t revert to traditional methods or solutions just because they’ve worked well in the past,” warned Delory. “Challenging periods are times to innovate and find new solutions to meet business demands.”
Speaking at the recent CES conference, Steve Koenig, VP of research of the Consumer Technology Association, pointed to the need for new infrastructures – such as 5G – to support a future of work underpinned largely by cloud, AI, and automation. “5G means faster mobile broadband for consumers,” he said. “But for commercial industrial IoT applications, it's really the greater capacity and ultra-low latency that is going to unlock so much innovation, and we're going to see that across this decade.”
3. Data Centers Will Shrink and Shift
Researchers say data centers will shrink and migrate to platform-based colocation providers. In fact, according to Gartner research, 35% of data center infrastructure will be managed from a cloud-based control plane by 2027. Large consumer goods companies such as Unilever are already making decisive moves in this direction, recently shifting its entire business function to the cloud as part of the company’s new organizational structure.
4. Organizations Must Prioritize Skills Growth
Finally, Gartner highlights that a lack of relevant skills is one of the biggest barriers to modernization initiatives, and successful organizations will have to invest in training workers in these hard-to-find capabilities. The research shows that just over half (60%) of data center infrastructure teams will have relevant automation and cloud skills by 2027, leaping from 30% in 2022. Beauty company Coty is just one of many CPGs drilling down on capability-building, recently launching an internal, metaverse-based virtual campus designed to upskill its global workforce.
