Insights / Blog / Gauging Covid-19’s Long-term Impact on the Data Center
April 14, 2020

Gauging Covid-19’s Long-term Impact on the Data Center

Scott Sinclair
Practice Director, Infrastructure & Modernization

Market Topics


late-to-the-cloudIn Nassim Talib’s book, The Black Swan, he focuses on the extreme impact of rare outlier events. I highly recommend adding it to your quarantine reading list. The key takeaway is that you can’t predict these events, so don’t try. Instead, prioritize creating robustness, whether in your life or in your business, so that you are prepared. It is not an if; it’s a when. 

So, how robust do you feel?

For the past few years, when I spoke about digital transformation, I typically highlighted the opportunity that leveraging data effectively could create for businesses. If I thought about digital transformation as a risk mitigation strategy, it was only as competitive necessity. In other words, if you don’t reap these benefits, your competition will. What I forgot, however, was Talib’s Black Swan theory.

The business world looks quite different now than it did a month or so ago. There is a much higher risk and cost associated with direct face-to-face communication and manual activities. In a matter of days to weeks, businesses have had to become completely reliant upon digital, remote work and increase their usage of cloud services. Everything that can be digital, needs to be digital.

Need remote, automated IT? Welcome to the cloud.

The show must go on. Business must continue. And when it comes to standing up and supporting new digital services, manual, on-location, traditional processes are no longer just costly, they are not an option right now. And when it comes to delivering digital services without manual, onsite interaction and activity, public cloud services typically have the advantage.

Hybrid cloud maybe the current de facto standard of IT, but both sides of the hybrid equation are not equal when it comes to automation. In a 2019 study of storage administrators using both on- and off-premises storage infrastructure, admins were 2.5 times more likely to perceive cloud services as superior at enabling IT automation.

It’s not surprising then that cloud adoption is taking off even more than it was before. So much so that in a recent Wall Street Journal article titled, “One Business Winner Amid Coronavirus Lockdowns: the Cloud,” it was reported that Microsoft Azure was running into its limits in some locations.

Where is my automated data center?

While there are tools and technologies that deliver similar levels of remote control and automation to the data center, the usage of these tools is not where it needs to be. This is likely due to a combination of under investment by IT organizations along with the challenges of automating a diverse set of heterogenous vendors and technologies.

For example, in a recent ESG study, IT orchestration and automation was identified by more than one-third of IT organizations as a problematic skill shortage. Think about that for a second. Automation is meant to reduce the number of personnel you need. When you are saying you can’t hire enough people to manage your automation, maybe the automation technology is too complex to be of any real use.

Innovation and investment continue in the area of IT automation, orchestration, and remote management, but is it moving fast enough? The answer at the beginning of the year might have been yes. The answer now is probably different. Given the realities of Covid-19, this could become a real concern for on-premises IT vendors.

Two Paths, One Destination

What does Covid-19 mean for the data center and for business and for IT moving forward? Is this a momentary anomaly or the start of the long-term shift? Let’s think about the options using a “choose your own adventure” style.

  • Path A: You were successful weathering the storm. You and your business were able to continue operations and find some success during this difficult time. Moving forward, you will likely recognize that this was due to your investment and experience with digital productivity tools and cloud services, encouraging more investment in the future. You might even recognize that if operations were able to continue without those big expensive office buildings, maybe you don’t need those anymore and you accelerate remote, digital work programs.
  • Path B: Your business took a significant hit during the pandemic. In this scenario, day-to-day operations took a huge hit. Either your organization is too reliant on physical employees being at a specific location or you under invested in remote digital services and automation. When the crisis hit, maybe there was a significant investment, but the roll out and learning curve took too long, and the damage was done in terms of lost revenue and lost market share. Moving forward, assuming the business is still intact, your executive team will want to be better prepared. As a result, you increase investment in digital collaboration tools and public cloud services.

Ultimately, both paths end up at the same location, with businesses prioritizing investment in digital transformation activities and investing in cloud services. In other words, investing in ways to make sure the business can operate with people doing as few physical, manual tasks as possible.

Traditionally, I would expect these types of investment to span both on- and off-premises resources. Unless on premises technology can improve its automation and remote management capabilities quickly, cloud services will likely capture the lion’s share of this investment moving forward.

Covid-19 is a wake-up call to all businesses on the necessity of digital transformation. But it should also be a wake-up call to data center technology providers. IT needs the ability to deploy, provision, and manage new services automatically and remotely, with little to no manual interaction. IT needs the automated data center. Better yet, IT needs the automated hybrid cloud, and it needs it now.

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