Cloud maturity is hampering AI adoption

Cloud maturity is having a direct impact on AI adoption, new research suggests, with only 14% of firms at the highest level of expertise.

According to NTT Data's new report, Cloud-led innovation in the era of AI: The new rules for driving value with cloud, while 99% of organizations say AI is increasing demand for cloud investment, 88% say current levels of spending are putting AI, cloud native, and modernization initiatives at risk.

Notably, as expectations rise, there's a disconnect between ambition and reality, the company warned. While the cloud is seen as essential for innovation, fewer than half of organizations said they were satisfied with its impact, or with the progress their modernization efforts were making.

“AI is accelerating faster than enterprise cloud maturity,” said Charlie Li, president, global head of cloud and security at NTT Data.

“Cloud has moved well beyond infrastructure and is now the execution layer for AI. Organizations that fail to evolve their cloud foundations risk constraining the growth and value of their AI investments."

Cloud leaders or organizations that indicated they were “cloud evolved” – the most advanced in terms of cloud adoption and impact, and with solid business performance – are significantly better positioned to capitalize on AI, said NTT.

The firm's advice is to develop cloud and AI strategies in tandem: AI demand is rising, it said, but alignment is uneven. chief AI officers (CAIOs) were 22% more likely than CIOs and CTOs to say that AI increases cloud investment needs, while AI is cited as the top cloud skills gap.

Cloud architecture choices are crucial, with organizations increasingly adopting a mix of public, private, hybrid and sovereign cloud models. Nearly all respondents told NTT they expect private cloud growth and sovereign cloud adoption to grow 50% in two years.

However, despite widespread agreement that cloud should drive innovation, half said legacy applications and data platforms are holding it back. Modernization is the top priority for the next two years.

Similarly, as investments stall and environments become more complex, more than half cited cloud cost management challenges, with organizations expecting a threefold increase in fully managed cloud platforms.

Mastering the cloud

Organizations should reset their cloud transformation KPIs, according to NTT Data.

Although AI is critical in helping organizations shift from technical to business metrics for cloud initiatives, adoption remains uneven. Nearly half of cloud leaders used AI in their last cloud migration project, compared with just a third of the rest.

Elsewhere, NTT Data noted that while security is the top cloud investment priority, confidence remains uneven, with 68% of the leaders feeling highly confident, compared with 36% of all others.

Leaders are also much more likely to define clear roles and responsibilities backed by regular audits.

"Our clients who are succeeding are treating cloud as a value creator, not a technology initiative," said Li.

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