Why aren’t more organizations moving their communications to the cloud?

Organizations, especially within IT departments, are dealing with a lot right now. Amid adapting to a hybrid work world, leaders are under pressure to reduce operating costs while competing to offer better customer experiences and facing a growing set of global competitors. Staffing issues persist, and it feels like many other issues pop up all the time.

We know recent telecommunications and networking advances can alleviate some of these challenges. Hardly a day goes by that I do not read something about customer experience or enabling employees to work from anywhere.

In this context, I am curious about the current horse race between on-premises (on-prem) and cloud communications. Yes, amid the cloud hoopla, a large install base of on-prem telephony still exists. It is also true that unified communications (UC) is growing, and my opinion is that eventually all companies will have at least some UC even if it is mixed in with on-prem services.

As an 8x8 employee, I am all in on cloud benefits. Admittedly, I had a dream once where I was extolling the virtues of moving CapEx costs to OpEx costs (weird, I know). So I have been wondering what’s the deal with sticking to on-prem? What’s the hold up? So I interviewed a number of our sales and service experts who speak with customers daily. My goal was to understand why aren’t more organizations moving their communications to the cloud and what is holding the cloud back?

Here are some of the things I learned:

Change can be hard

Some businesses have been using on-prem telephony services for 50 years or more. One insider told me that a big resistance around ditching on-prem for the cloud is the comfort in the familiar. She said there are many executives who expect that a cloud system works just like an on-prem one. When this occurs, her team works to help the customer focus on the eventual outcome and how the cloud can help them achieve their long-term goals and be prepared for the unexpected.

Phased implementation versus big bang approach

Organizations considering a cloud move appreciate that it can be deployed in phases. Often on-prem installations or upgrades are completed in a “big bang” approach that can take long amounts of time whereas cloud seats can be stood up in days. Deployments of up to three thousand seats taking a few weeks is realistic including with multiple locations. That is much more difficult to accomplish with on-prem. It is understandable though, especially within large enterprises, there are going to be risk-averse leaders. However, you do not have to deploy a cloud solution to all your employees right from the get go. We are finding that the ability to deploy a trial run is a good opportunity to win over holdouts.

Professional services can offer great peace of mind

Time-to-value, in today’s world, is up there with return-on-investment in terms of key metrics. While every organization has unique requirements, many of the components of a UCaaS solution design don’t vary that much. Because of this, implementation experts are able to develop blueprints that simplify and accelerate deployment. Speed matters today, not just in performance, but also in proving the concept to senior management so that deployments and features can be expanded.

We also find that some of the best UCaaS deployments include training for both users and administrators. There are correlations between proper training and actual employee usage. Some IT leaders are reluctant to want employees to learn new applications. Adoption is a big part of project success. The availability of professional services that range from self-service support to full hand holding regardless of coming from your UCaaS supplier or a third-party expert can often make a big transition more palatable.

Security is a big concern for everyone

Is security better in the cloud or via an on-prem implementation? The answer likely depends on who is answering the question. The pro-cloud contingent will bring up the ease of patching and upgrades because a cloud solution can do that automatically to any office. If we have a security conversation with a prospect and one of our security partners, we ask a lot of questions relating to impact on total cost of ownership (TCO) such as:

• How frequently do you patch?
• How frequently do you pen test?
• What are you spending to maintain your hardware?
• How are you backing up your data? Are you using DRaaS (a cloud-based service)?
• How do you adjust resource allocations across offices? If one office needs more capacity, do you just move hardware around?
• If your industry is regulated, how do you make sure your environment maintains compliance?

Their answers can sometimes impact their risk tolerance to make a decision to jettison their on-prem services in whole or in part. My opinion is that on questions about security, the issue is much less about technology and more about whom do you trust. How well cloud providers do earning that trust in the coming year will affect cloud adoption rates and with which provider.

Q&A with Paul Gentilini

Paul Gentilini is a director of professional services at 8x8 who works to help clients accelerate their time-to-value from cloud communications deployments.

What do you see as the biggest hurdle to a cloud communications migration among on-prem users?

The thought of taking the existing on-prem configuration and then building it on a new platform. I heard an IT leader ask how he is going to replace 10,000 phones in 15 or 20 countries especially if some offices aren’t even on the same switch. It can be a daunting task, and I think it is one area where a team of professional services experts who do this all the time can simplify the process, reduce risk, and make it more cost effective.

What is top of mind with customers once deployment is completed?

Deployment and customer enablement go hand in hand. IT leaders want their employees trained and using their new tools as soon as possible not just to validate and justify the purchase, but to begin seeing performance gains whether that means solving customers’ queries faster or by creating workflow efficiencies that were never before possible. Investing up front in training pays dividends in reduced support tickets, but more importantly by making it possible for employees to get the full benefit of the cloud platform.

What is one thing you wish all prospects knew about migrating their communications to the cloud?

Some on-prem customers who are reluctant about moving to the cloud do not realize the flexibility and power of cloud-based platforms where you can really federate your locations and users, across sites and countries. Consolidation leads to better efficiency. I think many folks underestimate the power of consolidating their resources in the cloud.

Do you think a cloud communications approach is more environmentally friendly than an on-prem one?

On a larger scale I do largely because of the efficiencies and reduced waste that can be realized. Imagine if everyone in your neighborhood had a generator for all their power needs rather than receiving power from a utility. Each house would need its own equipment, fuel and maintenance. I feel like the lack of economies of scale would do more environmental harm than a regional distribution system.

In 2022, upgrade cycles, work-from-anywhere initiatives and general digital transformation requirements will once again put the spotlight on the choice between on-prem and cloud communications. I feel like I have gained a little more insight into some of the considerations behind the choices. I hope you have too. It will be interesting to see how it plays out in the coming year.