By Kelly Stewart
The Rise of Cloud
The age of paper is coming to an end, and businesses have been shifting to digital data management. But what about the cloud?
The past twenty years have seen a huge rise in cloud-based software, with 16 out of the top 20 US pharma companies now leveraging cloud technology.
What are the reasons behind this widespread adoption? How does the cloud impact savings, security, and productivity at an organizational level?
In this article, we’ll explore 10 of the top driving questions around the rise and capabilities of cloud in SaaS.
Question #1: What Is Cloud Computing, Anyway?
Cloud computing taps into the power of the internet to deliver computing services such as storage, servers, networking, software, and analytics.
Unlike on-premise servers, cloud platforms do not need dedicated privately owned hardware, or data centers, to function.
Instead, cloud software is offered à la carte, allowing companies to only pay for what they use and adjust resourcing as they scale their business. This allows businesses to lower overhead costs by eliminating the need for dedicated IT infrastructure, IT workers, and server maintenance.
“The vision of cloud computing industries for the 21st century is to grant computing services in a convenient way just like any other basic services like water or electricity."
— Preeti Mishra, Assistant Professor, Doon University, Dehradun
Question #2: What Is Hybrid Cloud?
Hybrid cloud is a computing solution that uses a mix of on-premise and cloud software. Hybrid cloud provides a workaround to lifting and shifting an entire system in a cloud migration.
Sometimes considered “the best of both worlds,” a hybrid cloud approach allows companies to still use their core legacy infrastructure while still obtaining cloud SaaS benefits such as real-time data and flexibility.
“Hybrid cloud [provides] a single, unified, and flexible distributed computing environment where an organization can run and scale its traditional or cloud-native workloads on the most appropriate computing model.”
— Sai Vennam, Technical Offering Manager, IBM Cloud
Question #3: Is the Cloud Here to Stay?
Without a doubt, the cloud is here to stay. The question is no longer whether, but when.
The latest 2021 Cloud Security Alliance (CSA) Report found that public cloud adoption has doubled over the past 2 years, and shows no sign of slowing down.
Cloud SaaS continues to dominate the cloud service space, with over a third of the total market share in 2021.
And cloud sales are rising steadily in the post-pandemic world: Gartner estimates that end-user public cloud spending will reach a whopping $482 billion in 2022.
“Cloud computing helps manufacturers manage their businesses with better intelligence, which is made possible through expanded use of data analytics. In fact, the cloud is fast becoming the central venue for data storage, analytics, and intelligence for most manufacturers.”
— Stephen J. Ezell, Vice President, Global Innovation Policy, ITIF
Question #4: Is Cloud Migration Easy?
In short, it depends. For those unaccustomed to the cloud, migration may not be easy... but the juice is worth the squeeze.
Transforming a legacy system needs a shift in understanding, not just software. As such, cloud migration works best when companies make a point to support their team’s understanding of cloud technology and its many applications.
Another key to streamlining cloud migration is to hire cloud experts and put them in charge of the strategy and implementation. This helps ensure a smooth departure from inefficient legacy infrastructure—in other words, a true migration vs just a duplication.
When choosing a software vendor, you should weigh your options wisely.
An on-prem provider might seem like the simplest choice in the short term, but if they end up transitioning to the cloud (as so many SaaS vendors are), you’ll need to figure out if the vendor will require you to migrate your environment to the new architecture.
As McKinsey outlines in their 2021 life science cloud strategy, a successful cloud migration requires thoughtfulness, persistence, and a significant investment in time and resources:
Clearly, cloud migration takes considerable effort. So why are so many pharma companies biting the bullet and moving to the cloud?
The answer lies in the long-term value cloud provides. Once data is migrated to the cloud, data transfers can be streamlined to ensure accuracy and visibility — a nice-to-have in any industry, but crucial to achieve stringent pharmaceutical regulatory requirements.
“Although belief in the value of cloud is widespread, a clear understanding of precisely where that value resides — and how to capture it — is often lacking, leading to misguided strategies and faulty implementation.”
— Andrea Del Miglio, Senior Partner, McKinsey
Question #5: Is Cloud Storage Safe?
When the cloud was new and less widely understood, security was a major concern. After all, how could data stored in a public cloud be as safe as what’s stored in a private data center?
The cloud is constantly evolving, which means cloud security methods are as well. However, it’s no longer in question whether the cloud is secure. In fact, many argue that cloud is in fact safer than privately stored data: Would you rather keep a million dollars in your house, or safe at a bank? Most would choose the bank.
Additionally, cloud vendors invest heavily in security, hiring the sharpest minds in the business and using the latest advanced tools to ward off threats.
“In building their data centers, cloud providers use the same blueprint throughout their fabrics. The net effect is a reduced attack footprint and fewer holes to exploit since the application of security is ubiquitous.”
— Johnnie Konstantas, Senior Security Director, Oracle
Question #6: Is the Cloud Reliable?
In recent years, the cloud has proven to have utmost reliability for connectivity, scalability, and performance.
Most cloud vendors provide a service agreement for 99.9% uptime. An industry leader, AWS offers uptime of 99.95%, meaning that only a sliver of time — .05%, to be exact — will not be guaranteed for peak performance. In other words, less than a minute out of every day.
Cloud vendors offer many types of scalability, such as vertical scaling, horizontal scaling, and auto-scaling. This allows companies of all sizes to make use of the cloud, and to calibrate their cloud usage to accommodate business needs and growth.
Lastly, IT professionals widely agree that cloud has proven to match, if not surpass, on-prem standards for performance indicators such as speed, storage, and deployment.
“The initial concerns for moving to the cloud have nearly vanished. Globally, we see data latency dropping, availability increasing, and security provided by cloud-hosting services is often better than what is available from the manufacturer’s own IT departments.”
— Rick Franzosa, Senior Director, Analyst, Gartner
Question #7: Is the Cloud Cheaper than On-Prem?
The cost of the cloud depends on the skill and intention with which it’s wielded. By and large, the cloud helps companies minimize costs by eliminating the need for in-house data centers, storage, and IT.
However, cloud migration doesn’t come cheap. Gartner predicts that by 2024, 6 out of 10 infrastructure and operations leaders will encounter difficulty with reconciling the cost of public cloud services with their on-premise budgets.
It’s worth noting, though, that this comes as a one-time vs recurring cost. While not free in and of itself, cloud migration paves the way for long-term boosts in savings and ROI.
As McKinsey’s Andrea Del Miglio explains, “With so much value at stake, technology and cloud strategy is no longer a matter for the chief information officer alone, but a critical topic for the entire leadership team.”
When used strategically, the cloud’s long-term value more than outweighs the initial up-front cost of migration. As McKinsey found in their 2021 cloud migration analysis, Fortune 500 pharma companies stand to gain $10-15 billion in improved 2030 EBITDA run rates from IT rejuvenation, and roughly double — $25-30 billion — from cloud business innovation.
“With cloud, it’s not just the cost: it’s the convenience factor. You have to think about the cost in the context of its savings in energy and ROI down the line.”
— Arun Tomar, Director of Engineering, Apprentice
Question #8: Is the Cloud Just for Tech?
It’s a common misconception that the cloud is just for “tech tech” companies. This couldn’t be further from the truth.
While the cloud might have once been seen as only used in tech, there’s now widespread adoption in almost every industry. As of 2021, a whopping 94% of businesses use private and/or public cloud software.
“For life sciences companies, the cloud’s virtue is not just about running a more streamlined infrastructure, lowering costs, and accessing computing on demand. It is about the ability to unlock data, collaborate better across the ecosystem, create more meaningful patient and healthcare provider engagement, and transform their culture to embrace these new ways of working.”
— Geoff Schmidt, Managing Director, Accenture
Question #9: Is the Cloud for Life Sciences?
Though generally slow to embrace change, the life science industry has taken a clear stand on cloud and its value. As of 2021, 80% out of the top US pharma companies now use cloud technology.
Take this inspiring example from an industry leader, Moderna: They were able to deliver their first batch of COVID-19 vaccine for Phase I trial after only 42 days from the initial virus sequencing.
How? By using cloud technology to expedite their communication and data transfer. As Moderna's CEO Stéphanie Bancel puts it, “You don’t have to reinvent anything. You just fly.”
Public cloud adoption allows drug manufacturers to offload the time and labor of personal server maintenance, freeing them up to focus on their core expertise.
Instead of bleeding capital into setting up data centers, hiring people to run them, and training them to do it right, life science manufacturers can save their energy for what matters most: creating life-saving drugs.
“Cloud isn’t a future aspiration for life sciences companies — it’s an urgent mandate.”
— Christine Disco and Chuck Rozea, Analysts, Accenture
Question #10: What Is Cloud-Based MES?
Cloud-based MES uses cloud technology to optimize manufacturing execution systems for speed and accuracy. How? By leveraging the real-time visibility of the cloud to automate data capture and transfer.
In this way, cloud-based MES provides a holistic, real-time view into resources and production across teams and enterprises.
This real-time feedback loop gives manufacturers an edge in their revenue forecasting.
Instead of waiting for physical paper or trying to unite a patchwork of disconnected legacy systems, cloud manufacturers receive instant access to operational data across teams and sites. This lets them effortlessly coordinate between multiple sites and stages of the drug production lifecycle.
With a constantly updating stream of data and updates, manufacturers can use cloud technology to strategically introduce new products at the right time to maximize revenue.
“Today, the cloud is widely accepted as a highly secure and effective way to manage MES. With the SaaS model, IT operations, maintenance, and support can be transferred to 24/7 to experts — this also shifts costs from capital expenditures to operational expenditures, greatly reducing total cost of ownership.”
— Matics Manufacturing Analysts, 2022
Tempo: One Cloud for All Your Needs
At Apprentice, we’re proud to be a cloud-first company, building cloud capabilities into our strategies and architecture from the start.
We’re cloud-native — meaning that to us, cloud is an inspiration, not an afterthought.
Our Tempo Manufacturing Cloud lets you scale up and out faster with one, unified platform for all your teams and sites. With Tempo, your global production teams can operate in real time from a single shared system that combines manufacturing and lab execution systems with built-in collaboration.
Learn how Tempo harnesses cloud technology to give your manufacturing teams what they need, exactly when they need it. Explore Tempo Cloud.
Closing Thoughts: The Cloud’s Not Going Anywhere
As people continue to gain familiarity with the concept of the cloud, public misconceptions around its value and capabilities will shift. Specifically, the cost, safety, and reliability of cloud will be better understood by those who stand to benefit from it the most.
Our key takeaway: The cloud is here to stay.
There’s one question we haven’t covered: Is the cloud right for you? The answer varies by business and need.
For monolithic companies with predictable processes and infrequent product updates, the cloud may not be necessary. For smaller companies with evolving needs and offerings, the cloud is the smart choice.
Cloud: Take it or leave it
- Large IT teams that can support customizations
- Set, unchanging manufacturing process
- All in-one facility without cross-site collaboration
- Infrequent changes to products and services
Cloud: No longer optional
- Smaller teams without dedicated IT professionals
- Evolving business needs and processes
- Need for communication between multiple sites
- Continual rollout of service offerings and updates
“To realize true digital potential, manufacturers must stop relying on legacy IT and place cloud-scale data management at the heart of their business. A cloud-first approach forms the bedrock of AI, ML, automation, and smart factories, enabling businesses to improve their agility and increase competitive advantage.”
— Rens Huizenga, Cloud Modernization Lead, Capgemini
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