It has been five years since a cataclysmic event triggered transformational changes for the world’s workforce. In response to an once-in-a-lifetime pandemic, offices were suddenly forced to undergo a massive transition as countless industries had to shift to remote work practically overnight, a craze that is only now being dialed back as some companies are returning to being in-person once again.
Cloud computing has been at the heart of these changing tides, providing remote work technology to keep teams meaningfully connected inside and outside of the office. By blending public and private cloud technologies, companies have been able to adapt and evolve. Cloud-powered services, including Zoom, Slack and ServiceNow have become integral to the IT mix allowing employees to work seamlessly in and away from the office.
“What the pandemic demonstrated is that we can all work from home,” Kory Kantenga, a senior economist at LinkedIn, told U.S. News and World Report. “It was a proof of concept.”
According to Gallup, 26% of U.S. employees that can work remote are now working exclusively remote and 55% are working hybrid, that is a blend of both on-site and offsite work. With the health crisis in the rearview mirror, some companies are once again requiring in-office attendance while others are betting that hybrid or remote work gives them a competitive edge.
“The big shift is within the broad category of what we call remote,” said Nick Bunker, director of North American research at Indeed. “We’re shifting into a new equilibrium with more people working remotely a few days a week. The more enduring feature of remote work is now hybrid.”
While these numbers may be down from the height of the pandemic, when offices were shuddered due to public health concerns, a half-decade later remote and hybrid work is clearly here to stay.
Advocates report that remote work makes employees more productive, happier and healthier both mentally and physically. It can free people from the stress of a daily commute and allow more time to be with loved ones.
“The rise of remote work has made business roles more flexible and, therefore, substantially more attractive to workers than ever before,” said ZipRecruiter Chief Economist Julia Pollak.
Businesses can benefit, too. Remote work strengthens company loyalty, employee retention and can decrease costs, up to $11,000 per employee per year according to one study. Companies can more easily tap into a larger and more diverse talent pool. Remote and hybrid work is even better for the environment.
"Remote work has been proven to be effective time and time again, with studies showing increased productivity, improved employee satisfaction and broader access to talent," Bryan Driscoll, an HR consultant, told NewsWeek.
The larger societal impacts of remote work have grown more evident in recent years. Urban downtowns are seeing the economic effects of empty office buildings as many commercial businesses struggle in the absence of foot traffic from commuting workers. In addition, housing prices are rising in previously affordable suburban areas as people realize they don’t need to live in more expensive city centers.
The cloud is an essential part of the remote and hybrid work equation. Cloud based software and remote work technology allows employees to access files anywhere, collaborate with anyone, whether that’s through video conferencing or instant messaging and speed-up workflows. With the rise in AI, these tools are only becoming more robust for workers both inside and outside the office.
As a result, the pandemic accelerated many company’s shift to cloud services and that growth has only continued with the explosion around AI. Gartner expects end-user cloud spending to increase 21.5% globally in 2025.
“In uncertain times, the public cloud provided flexibility and a safe haven for enterprises that were struggling to maintain normal operations,” said John Dinsdale, Chief Analyst and Managing Director at Synergy Research Group.
But in their article The Cost of Cloud, a Trillion Dollar Paradox, a16z analysts Sarah Wang and Martin Casado did the math and warned that a rush to public cloud could be costly. They advised businesses to take a smart approach to using public and private cloud technologies.
“As industry experience with the cloud matures — and we see a more complete picture of cloud lifecycle on a company’s economics — it’s becoming evident that while cloud clearly delivers on its promise early on in a company’s journey, the pressure it puts on margins can start to outweigh the benefits, as a company scales and growth slows,” they wrote.
Cloud Infrastructure as a Principal Enabler of Remote Work
To facilitate remote workers requires having the the right IT infrastructure. An SWZD survey echoed Dinsdale’s claim and found that many businesses weathered the COVID-19 storm simply by enabling employees to work from home. Just three months into the pandemic, over 60% of employees across industries were working remotely, up four times from pre-pandemic levels. Later, this number came down to around 30% – and that was the new normal when the dust settled.
Source: Spiceworks Ziff Davis
Advances in cloud infrastructure have made the near-instantaneous switch to remote work – and subsequent swings to more hybrid work – possible.
“The ubiquitous availability of cheap cloud compute cycles coupled with remote desktop services has proved to be a huge enabler in mobilizing a workforce,” said IT analyst Steve McDowell in a Forbes article.
Matt Kimball, vice president & principal analyst, datacenter at Moor Insights and strategy, agreed.
“It wasn't until COVID-19 that VDI was finally recognized as not just a useful tool but a critical tool for business continuity in enterprises with a global workforce,” Kimball said.
“The cloud has enabled consumption-based, tailored solutions in VDI and other technologies,” said Kimball. “The HPEs, the Dells and the Nutanixes are building these readymade solutions – you just need to plug them in and turn them on.”
Desktop-as-a-Service (DaaS) – the cloud implementation of VDI – makes it possible to run centralized virtual applications and desktops in public clouds or on-prem regardless of the underlying platform, accessible with just a browser and an internet connection at the end of the user.
DaaS eliminates the need to procure, deploy, and manage hardware and software infrastructure. Organizations can simply contract their VM needs to a public or private cloud vendor, leading to optimized IT costs and a more consistent remote work experience for employees.
“It delivers the promise of the cloud without the penalty of the cloud,” Kimball said.
Balancing the Cost Factor
While companies continue to dive headlong into the cloud, they’re running into cost overruns because of unforeseen complexities.
Source: McKinsey
In fact, public cloud services are costing these companies up to six times more than private infrastructure, according to Tim McCallum, Director, Business Value Programs and Strategy at Nutanix. That’s not all, Andreessen Horowitz estimates that the top 50 public companies currently using cloud infrastructure are collectively losing $500 billion of market value due to the cloud’s impact on their margins.
Organizations that realize this – belatedly or otherwise – are increasingly attempting to contain costs by moving workloads back to owned and co-located datacenters, building private clouds, or setting up an agile, hybrid infrastructure. When implemented correctly, an intelligent IT set-up can help companies save money.
The trick lies in getting off public cloud platforms when their economic benefits start to diminish. Since enterprise software is usually tightly integrated with the cloud platform’s code, changing the infrastructure is difficult because of factors such as vendor lock-in.
Hybrid Multicloud Provides a Workable Solution
“We’re entering an era of Cloud v2 where we’re asking, ‘What is the right architecture? How can I use the cloud in the right ways?’” said Martin Casado, General Partner at Andreessen Horowitz.
A hybrid cloud gives organizations the ability to pivot quickly in the face of changing market conditions and hybrid work environments that have become the norm in this new era of work. No surprise then, that 86% of IT leaders now consider hybrid cloud to be the ideal operating model for their organizations.
As IT leaders take a cloud-smart vs. a cloud-first approach to hybrid multicloud, they’re looking to reduce operational complexity of migrating, extending or bursting applications and data between on-premises and public clouds. The cloud-smart way is combining hybrid and multicloud solutions into a single, unified environment using Nutanix Clusters.
The Cloud Ahead
The one lesson COVID-19 taught the world is that the future is unpredictable. Charles Darwin is believed to have said, “it is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.”
The IT world is no different. The pandemic and the resulting remote work craze did not just accelerate cloud migrations in companies, it also elevated IT decision-makers to the boardroom. A lot of organizations are finally starting to recognize that IT is critical to the survival, continuity and growth of their business. The next few years will see business and digital transformation running in parallel, enabled by cloud technology. The meteoric rise of artificial intelligence will also help put IT more firmly into the spotlight.
As hybrid multicloud environments mature, “industry clouds” are slated to arise as the next big thing in cloud computing. These are industry-specific applications and solutions offered by major public cloud providers in an attempt to gain higher market share in verticals. This reflects the fact that domain-specific cloud solutions have become even more important.
“Every company is a snowflake,” said Kimball. “The pandemic, the cloud and regulatory pressures will all force them to transform. Enterprises need to get to cloud-like operations quickly to be competitive with smaller companies that are using the cloud entirely.”
The cloud is helping to fundamentally transform how and where people work and that is leaving a lasting impact on society at large.
This is an updated version of the article original published on July 6, 2022. https://www.nutanix.com/theforecastbynutanix/news/how-cloud-infrastructure-evolved-since-the-pandemic
Dipti Parmar is a marketing consultant and contributing writer to Nutanix. She’s a columnist for major tech and business publications such as IDG’s CIO.com, Adobe’s CMO.com, Entrepreneur Mag, and Inc. Follow Dipti on Twitter @dipTparmar or connect with her on LinkedIn for little specks of gold-dust-insights.
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