ISG Provider Lens™ Public Cloud - Solutions & Services - Switzerland 2020 - Consulting and Transformational Services

ISG observes an accelerated introduction of cloud computing using a hybrid and often multi-cloud approach in which the public cloud and the associated architecture principles play the dominant role. The investments made at present in cloud computing lay the digital foundation of a company – a crucial component in the entire digital transformation. In addition to the increasing use of multiple public cloud providers currently an average of 1.5 providers in Switzerland ¬ it is important for service providers to take public cloud partnerships much more seriously and intensify them accordingly in order to bring customers closer to individual platform features and create added value. Switzerland is still very Microsoft-focused, but is increasingly using AWS and Google as well as many other offers that tend to be local. In the case of AWS, ISG sees a much greater popularity on the part of IT service providers, who, however, are too seldom integrated and certified in the partner network. Google's partner ecosystem is generally still in its infancy, but could grow rapidly thanks to the data center that opened in 2019.

The partnerships of service providers with hyperscalers have become even more important. In addition to a partnership level at the highest level, service providers also quickly acquire competence certifications equivalent to a seal of approval and demonstrate that the service provider has acquired expert knowledge in the transformation in this specific area (for example, migration or DevOps) or technology (for example, SAP). Given the increasing demand for public cloud services, often driven by the need for elasticity, service providers continued to take advantage of training and certification courses during the COVID-19 pandemic to increase the level of collaboration for their customer needs. Service providers also develop industry-specific transformation skills in order to use accelerators to serve specific vertical industries quickly and adequately in compliance with their industry compliance and guidelines.

Working in remote locations has fuelled the demand for functional, increasingly vertical SaaS and business intelligence solutions. Customers are increasingly moving towards optimization and cost reduction across vertical areas, such as through analytics in retail or the general acceleration of digital solutions in the financial sector; the focus in on understanding individual customers and their demand and leading companies away from gut decisions to data-driven decision-making processes.

Right now, in the present times which are highly uncertain and dictated by the coronavirus, companies are striving to introduce the latest cloud services as quickly as possible; the top use case was and is the cloud-based remote workstation. It should be noted that many public cloud strategies have already been predefined and are now being rolled out owing to the pressure to keep the business going. As a consequence: enterprise governance, risk and compliance (GRC) models must be changed and adapted to hybrid or public clouds. This costs time and money and only works with experts who are familiar with contracts and, in some cases, industry-specific regulations and who can make changes with regard to the business.

A broad survey of 100 mid-tier companies in the DACH area revealed a clear trend: Companies agree that savvy consulting and managed services are critical to the success of digital transformation. Finding and retaining experienced specialist staff is a particular challenge which, in the course of the required reaction speed, often leads to the involvement of external partners in the form of IT service providers. This is made clear by the typical response, “We need the support of a partner in managing risks and compliance issues.”

Consulting & Transformation Services

During this time, companies of almost all sizes and industries are forced to promote innovations and adapt new business practices as be as agile as start-ups. A common denominator emerges in this case: customer experience management. Customer needs and their satisfaction are, therefore, more important than ever for business success. The changing market is determined by fast-moving and individual customer requirements. In order to comply with these, it requires clever use of the most modern cloud-native technologies for the transformation to a data-centric company, which also mean a cultural change, and thus, require appropriate change management.

Companies have to change their organisational structure and acquire methods such as design thinking, SCRUM, and thus, small-scale sprint work cycles in order to meet customer requirements and exploit new IT delivery models and operating models for themselves.

Last but not least, challenges and risks arise from the tension between agility and security. The end-to-end agility enablement of the software development and maintenance or governance process is particularly crucial. The manual adoption of application code through development, testing, production configuration, code deployment, and data sharing usually becomes a bottleneck.

Native cloud security offerings are necessary to protect an attack surface that is vastly different from what companies are traditionally used to managing. This additional complexity of the security requirements often requires special software and services. Incidents in the past have shown that security requirements of their Kubernetes Clusters can come as a surprise even for the technically most well-equipped companies.

Core applications of user companies are often proprietary or monolithic and/or cannot be easily migrated to a virtualized/container-based environment or microservice-compliant public cloud via lift and shift with regard to the licensing model; re-engineering or breaking up of applications or the dependent workloads is costly and requires middleware and developer experts, who are rare. Breaking up of mainframe applications or migration from SAP to AWS Microsoft Azure or to AWS or GCP is also very popular in this case.

Leading providers include: Accenture, Atos, Capgemini, DXC, IBM, Swisscom, Wipro and T-Systems. Avectris and ti&m were able to qualify as Rising Stars.

Governance, Risk & Compliance Services

For a long time, concerns about data protection slowed the introduction of cloud services into the European market. For some time, however, it has been observed that more and more companies are making the decision to outsource their infrastructure element or entire application to the cloud. In course of the journey to the cloud, especially in highly regulated markets and industries, such as the financial service sector, there are some obstacles which need to be overcome. Governance, risk and compliance (GRC) should not be missing in a comprehensive and well-planned cloud strategy. A large number of environment variables must be taken into account. The integration of industry-specific standards is not yet a major problem for most companies. The regulatory framework in this case is mostly known to be industry-specific. The survey of the participants in this study revealed that companies often have different maturity levels in GRC implementation. This extends from implementation of the industry-specific regulations to national, international and European regulations, such as the GDPR, and is rounded off by the correct technical implementation of the public cloud service, which is in compliance with the rules. It can be observed that the service providers who are commissioned for the technical implementation are also commissioned with consulting serviceservices relating to the technical assurance of compliance for these cloud serviceservices. In most cases, the auditing and certification are the responsibility of the large management consultancies. These have just upgraded in the area of risk evaluation, assessment and mitigation. In addition to extensive frameworks for rule compliance, the consultants have upgraded with automated tools and implemented artificial intelligence. Right at the forefront and the leading companies in this study are the “Big 4,” consisting of Deloitte, EY, KPMG and PwC.

Managed Public Cloud Services

The focus of the operational outsourcing of infrastructures, platforms and, increasingly, even that of applications, rests on cost optimization through automation and, at the same time, on reducing complexity through the managed service provider. It is not uncommon for service providers to develop cloud management pplatforms (CMPs) to meet these requirements. For customers, saving one to two FTEs by means of outsourcing of operations is not unrealistic. In addition, the option of shifting company resources to core activities, and thus, activities with a direct impact on the business, is also lucrative. As the new world gets used to working from home as well, it has become even more tempting for companies to outsource their cloud management and focus on building and developing innovative solutions for their customers. Service providers leverage DevOps and Infrastructure-as-Code (IaC) practices along with artificial intelligence-enhanced automation and self-healing with pre-configured API integration capabilities to efficiently manage and integrate cloud infrastructures.

Hyperscalers offer dedicated managed service provider (MSP) accreditations as part of their affiliate programs to ensure that managed service providers know exactly what they are doing. In Switzerland, it is primarily service providers geared towards large customers who are certified in this regard. The other providers are still lagging a little behind.

Many managed service Engagements go hand in hand with migrations of applications for initial optimization or standardization. In this regard, it is important in every customer relationship to synchronize Dev and Ops teams, to find individual update, and thus, release cycles, and to put software and apps at the center of the digital transformation without neglecting their operation. In order to support the continuous delivery pipeline (CD) and the concept of approval on request, the system must be designed for low-risk component or service-based delivery including lean approval processes and recovery scenarios. The principle of “fix forward or roll back” applies here.

An IT service provider is often involved in the process owing to lack of specialist staff; these providers themselves are often faced with the challenge of finding and retaining experienced specialists for the secure operation of the containers or serverless components in Dev(Sec)Ops mode. Therefore, providers of Dev services and Ops services are under pressure to develop cooperative approaches that combine the best skills from both worlds in order to provide the opportunity for short sprints in close cooperation with customers without causing reduction in availability.

Leading providers for large customers include: Accenture, Atos, DXC, Capgemini, IBM, T-Systems, Swisscom and Wipro.

Leading providers for mid-tier businesses include: Avectris, BitHawk, ti&m, Netcloud and Swisscom. Baggenstos and UMB were able to position themselves as Rising stars.

Secure Enterprise Filesharing Services

Collaborative work on important documents and processes in modern companies is essential in today's times. Instead of local computers or an internal Intranet, the files are stored on Servers in Server Clusters that are spread around the world. The data is stored centrally in the data center of the cloud provider and can be accessed from anywhere with any device. Data is accessed via browser or login screen. The only requirement is a working internet connection.

Leading providers include: Box, Brainloop, Citrix, DRACOON, Dropbox and Microsoft. Tresorit was positioned as a Rising star.

SAP HANA Infrastructure Services

With the SAP S/4 HANA platform in the cloud, workloads can be simplified; secure basic operation is guaranteed in redundant data centers. High flexibility, scalability at any time, servers, processors and databases certified by SAP, the use of existing applications or the selection of pre-configured applications from SAP partners offer the user a wide range that is not possible from their on-premise environment.

Leading providers include: Avectris, AWS, Google, IBM, Microsoft, Swisscom, T-Systems and UMB.

Hyperscale Infrastructure & Platform Services

The range of services is constantly expanding - and offers customers great added value. The ability to execute the Workload at any location further increases flexibility. The customer can decide whether the processing should be carried out in the cloud, in the customer’s own data center or in a colocation data center. The hardware and software environment are uniform in all instances, which ensures seamless operation. Server performance is improved by acceleration-optimized processors, not least because of new tools such as AI and ML that are creating computationally intensive workloads. IaaS and PaaS services are growing together more and more, and are being presented in a quadrant for the first time. IaaS (Infrastructure as a Service) provides on-demand infrastructure functions. Enterprise cloud providers can offer different clouds which can be adapted to customer requirements and can include hybrid, multiple public or multiple private clouds. PaaS (Platform as a Service) offers help with the creation, operation and monitoring of applications. The aPaaS market offering includes application-centric services, Low-Code/No-Code development and test scenarios – all based on public clouds or variations of hosted private clouds. The PaaS share of the market segment outweighs the IaaS share, although it can be observed that this sub-segment is growing rapidly and a plus of 24% was forecast for 2020. The growth is attributed to the demands of modern digital workloads and applications that require an infrastructure which traditional data centers cannot provide.

Leading providers include: Avectris, AWS, Google, IBM, Microsoft, Red Hat, Swisscom and UMB. The Rising star of this quadrant is ti&m.

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