Cloud spending is surging as enterprises continue to rely on cloud-based solutions to meet their needs. According to Gartner, cloud end-user spending is forecasted to reach $679 billion in 2024, a 20% increase from 2023.
In a typical Fortune 100 organization, it’s common to find 1,000+ software applications in use. While some are legacy, home-grown systems, the vast majority are cloud-hosted solutions adopted by various functions to meet specific needs. This proliferation of applications is intended to provide best-in-class capabilities—project management software excels at managing tasks and risks, financial planning tools streamline FP&A, and sales software optimizes pipeline management and revenue generation.
But despite these tools being great individually, together they often fall short of helping the enterprise as a whole. In fact, this “best-of-breed” approach can create significant problems, reducing the agility and nimbleness of the organization. For instance, CFOs may have limited visibility into how strategic projects are performing, while sales teams might not have clear insights into financial forecasts. These disconnected systems result in siloed information, making it difficult for leaders to make informed decisions.
Ask any CIO or CTO, and they will tell you they’ve been dealing with “shadow IT” for decades. However, with SaaS purchases becoming easier and department heads having greater control over their budgets, the landscape has exploded. As a result, managing this sprawling tech ecosystem has become increasingly complex for CIOs, CISOs, and CTOs. They’re often left playing catch-up, trying to manage overlapping tools and fragmented data across the enterprise.
To complicate matters further, SaaS vendors are constantly expanding their features. Your financial planning software might now include HR functionality, your service management software offers capital allocation tools, and your project management solution has evolved into an enterprise architecture platform. While these enhancements are valuable in theory, they often exacerbate the problem by creating further overlaps, redundancies, and data silos.
For enterprise leaders tasked with driving transformation and scaling their organizations, this feature creep and ecosystem overlap may actually slow progress. Worse, it leads to wasteful spending and inefficiencies as businesses try to manage increasingly fragmented systems.
What’s the alternative?
What if we flip this problem on its head? What if we could take advantage of these feature-rich, overlapping SaaS solutions to converge towards an integrated Enterprise Cloud Platform? Many SaaS products have become so feature-rich and scalable that they can serve as comprehensive platforms in their own right. Better yet, some of these platforms offer industry-specific and domain-specific workflows to meet most of your needs.
Gartner predicts a growing trend toward “Industry Cloud Platforms“—solutions that combine SaaS, PaaS, and IaaS capabilities to deliver comprehensive offerings tailored to specific industries. By 2027, more than 70% of enterprises are expected to leverage these industry cloud platforms to streamline their operations.
Is your organization moving in this direction?
Are you consolidating towards an enterprise cloud platform? Does your software budget include reducing opex by eliminating redundant SaaS licenses? Are your CxO counterparts on board?
