Special Feature
Part of a ZDNet Special Feature: The Industry Cloud: Why It's Next

Top 5 industry clouds in the enterprise

As cloud applications increase in popularity, five industries are tailoring the cloud to their specific needs. Here's how.

How the health care sector can tap into more data in Salesforce's Health Cloud ZDNet's Stephanie Condon talks with TechRepublic's Karen Roby about how health care providers, payers and other parts of the industry can now add "social determinants" to the Health Cloud. Read more: https://zd.net/2By418A

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Special Report: Industry Cloud (free PDF)

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The movement of data to the cloud has exploded over the past few years, with cloud giants like AWS, Microsoft, and Google taking the enterprise by storm. The global cloud infrastructure services market grew 42% year-over-year in the first quarter of 2019, according to a recent Canalys report.

"When we use the term 'cloud' and when our clients use the term 'cloud', they typically are thinking in at least three different dimensions or directions," said Andrew Bartels, vice president and principal analyst at Forrester Research.

These dimensions, Bartels explained, include replacing on-premises applications with software-as-a-service (SaaS) models or single host applications, cloud middleware, and cloud infrastructure, in which compute and storage resources are accessed by a cloud provider.

SEE: Industry cloud: Adoption plans, decision factors, strategic results (TechRepublic Premium)

However, since public cloud options are not a one-size-fits-all solution for every industry, vertical-specific cloud solutions are surfacing. These vertical cloud solutions, also known as 'industry clouds', are experiencing significant growth.

It's easy to see why. Cloud applications made for specific industries are both cheaper and more efficient than other on-premises or general-purpose cloud options, said Ed Anderson, research vice president and distinguished analyst at Gartner.

"[The cloud] has been about data center consolidation and efficiency," Anderson said. "It's been about moving applications to the cloud, where I can pay for consumption of cloud services, which is less expensive than trying to do it all on my own. And some of that expense is in the form of a physical environment to run your own applications. You can outsource the management of those systems to the cloud. Sometimes it's about staying current and having the latest features, and those are pushing toward the cloud."

The industry cloud is almost inevitable for many industries, especially those using legacy vendors, Bartels added. Many legacy vendors are pushing organizations to move away from old systems and become more cloud-like, to keep up with the changing business tech environment.

Here are five industries seeing the largest investments in industry cloud solutions.

1. Manufacturing

The majority (84%) of global purchase influencers in North American manufacturing firms confirm that increasing the use of cloud is a moderate, high, or critical priority over the coming year, according to Forrester Research.

Most on-premises technologies first rose in manufacturing, Bartels said. With the rise of industry cloud, however, core transactions in manufacturing are moving to the cloud. These core transactions include "the systems that are used to run the factory lines to handle the inflow of parts and materials, which are going into production...and the feeding of the end product that goes into systems for delivery or for sales to customers," Bartels added. 

With automation predicted to take over the manufacturing industry by 2024, this field is ripe for digital transformation. 

2. Retail

Vertical cloud solutions also have great success in the retail industry, mainly due to the massive amounts of data that this industry generates, Anderson said.

Some 77% of global purchase influencers in North American retail organizations cited the increasing use of cloud as moderate, high, or critical priority over the coming year, Forrester Research determined. With such a large volume of data, retailers need to scale up on data storage, collection, and organization practices. 

Industry cloud makes a huge impact on core retail management systems, particularly around the cycling of goods and inventory, Bartels said. 

"These systems help manage the inflow and outflow of goods that a retailer has, and how that flows through their own distribution system of stock that's in warehouses, versus stock that's on trucks, in stores, or has just been sold," Bartels continued. "These systems keep track of those stock levels, and make sure that there is a flow of goods in to replace what's going out to the customer."

Cloud technology also helps track business performance of various retail stores and outlets, based on whatever factors the companies want, improving efficiency, sales, and customer satisfaction, Anderson noted.

3. Government

Perhaps the most prominent of the industry clouds, according to Anderson, is in the government sector. 

"You see it mostly in North America, but there are other examples in other countries where you either have hyper-scale providers who provide a specific government version of the cloud, or you'll have a country provider offering some form of a focused government or country-specific cloud," Anderson said. 

These clouds help alleviate the isolation of workloads, working as a closed community, which  guarantees no classified data will leave the country. Users need to receive specific permission from the government to host workloads on a government cloud, Anderson said. 

SEE: Cloud computing: Five key business trends to look out for (ZDNet)

4. Healthcare

Another hotbed for data management and storage occurs in healthcare. According to Forrester Research, 74% of healthcare global purchase influencers in North America said that the demand for cloud use is a moderate, high, or critical priority in the coming year. 

Healthcare industry clouds allow for a central, secure place to store information, which is critical in an industry that houses many personal records

Cloud computing can also help healthcare professionals learn about patients by tracking and keeping data about patients' care, behavior, and health progression, said Anderson. With this information, health professionals can look at success rates and correlating scenarios, certain drug reactions, and other insights, he added. 

5. Agriculture

The agriculture sector has seen great success in innovation, with movements in the internet of things (IoT) and big data helping farmers learn more about their environment and crop production. These technologies, paired with an industry cloud, can yield extremely powerful insights for farms and agriculture giants.

"In the case of IoT plus cloud, that's where you're going to see [agricultural] manufacturing really exploit the capabilities of cloud," Anderson said. "Any place you can put a sensor that can capture information about its environment -- soil sensors, machine sensors, seed or grain sensors, sensors around animals -- the cloud can help you process it."

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