IBM Center for Applied Insights Study. Hybrid cloud is the de facto state of IT. Leading organizations are blending traditional and cloud infrastructures to achieve better business outcomes—from reduced costs and improved productivity to business growth and digital transformation. What’s more, they’re using hybrid cloud to springboard to next generation activities that allow them to disrupt and capture new markets.

1. © 2016 IBM Corporation
Growing up hybrid
Accelerating digital transformation

2. © 2016 IBM Corporation
Hybrid cloud is the de facto state of IT.
Leading organizations are blending
traditional and cloud infrastructures to
achieve better business outcomes—from
reduced costs and improved productivity to
business growth and digital transformation.
What’s more, they’re using hybrid cloud to
springboard to next generation activities that
allow them to disrupt and capture new
markets.

3. © 2016 IBM Corporation
To understand how hybrid cloud is
impacting organizations, we
surveyed 500 IT decision makers
worldwide who are blending
traditional and cloud infrastructures
Growth markets surveyed: China, India, Brazil. Mature markets surveyed: USA, UK, France, Germany, Denmark, Finland, Norway, Sweden, Japan,
Australia. To smooth possible geographic distortions, responses were weighted based on an IBM assessment of each country’s total IT spend.
Hybrid cloud is the connection of traditional IT systems to one or more clouds and/or connection of one or more clouds to other clouds.

4. © 2016 IBM Corporation
Hybrid cloud is the new norm—the hybrid blend is changing as the
use of cloud increases
4
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2-3 years ago Currently 2-3 years from now
Traditional IT
Public
Cloud
Private
Cloud
report they will always have a
blend of traditional IT and cloud
7 in 10

5. © 2016 IBM Corporation
Leading enterprises are out ahead, driving competitive advantage
and gaining comprehensive control of their hybrid environments
5
Frontrunners are gaining competitive
advantage through hybrid cloud and are
managing their environment in an integrated,
comprehensive fashion for high visibility and
control (e.g., through a single dashboard)
Challengers are on the journey toward
competitive advantage, but haven’t fully
achieved unified management of their hybrid
cloud environment
Chasers are not yet using hybrid cloud to
drive competitive advantage and are in the
early stages of gaining integrated control over
their hybrid environment
Gaining competitive advantage
through hybrid cloud
Managementof
hybridcloud
Limited
Comprehensive
Low
agreement
High
agreement
Chasers Challengers Frontrunners
Chasers
22%
Challengers
52%
Frontrunners
26%

6. © 2016 IBM Corporation
Frontrunners believe hybrid cloud is essential and provides
greater ROI
6
86% of Frontrunners
say: Hybrid cloud gives
us greater ROI than
either an all-traditional
or all-cloud environment
88% of Frontrunners
say: Hybrid cloud is
crucial to our
business strategy
and success
... and they’re using hybrid cloud to
transform their organizations

7. © 2016 IBM Corporation
Frontrunners achieve better business outcomes with hybrid cloud –
going beyond efficiency gains and using it to forge their digital futures
7
85% of Frontrunners
report that hybrid cloud is
accelerating digital
transformation in their
organization
EFFICIENCY & PRODUCTIVITY
DIGITAL BUSINESS
NEXT-
GENERATION
INITIATIVES
HYBRID ENVIRONMENT
Comprehensive hybrid cloud integration and management
Hybrid cloud enables cost reduction and efficiency gains
Hybrid cloud enables new business growth
Hybrid cloud enables disruption

8. © 2016 IBM Corporation
Frontrunners outpace other implementers on efficiency
and productivity with hybrid cloud
8
Chasers Challengers Frontrunners
Frontrunners
vs. Chasers
Cost reduction by shifting fixed
costs to variable costs 1.7x
Maximizing value from existing
traditional infrastructure 1.9x
Improved productivity 1.8x
Improved business processes
and workflows 1.8x
Scalability 1.5x
Resiliency 1.4x
51%
50%
46%
55%
43%
46%
66%
69%
72%
64%
64%
64%
75%
75%
% of organizations achieving
outcomes with hybrid cloud:
85%
82%
82%
81%

9. © 2016 IBM Corporation
Hybrid cloud enables faster deployment while cutting costs
9
Headquartered in Norway, with offices around the
world, Cxense ASA provides real-time analytics, data
management and personalization technology to over
6000 media, financial and consumer sites around the
world. To expand globally, Cxense needed a hosting
platform that could scale efficiently while protecting
customer data.
Cxense implemented a hybrid cloud solution that
allowed them to expand data centers to other locations
in Europe and Japan, while also using the flexibility of
cloud to quickly and easily support growing demand.
As a result, Cxense achieved 98 percent faster
deployment with provisioning reduced from three
months to less than a day, allowing the company to
expand its global presence and improve agility.1

10. © 2016 IBM Corporation
Frontrunners are also ahead on achieving business growth
and capturing new markets with hybrid cloud
10
Chasers Challengers Frontrunners
Frontrunners
vs. Chasers
Product/service innovation 2.0x
Expansion into new markets,
customer segments and offerings 2.2x
Expanded ecosystem 2.1x
Market responsiveness 2.1x
Digital services 4.0x
Assembly of new products
by composing APIs 4.3x
12%
42%
38%
8%
36%
37%
28%
64%
50%
18%
59%
70%
48%
34%
76%
82%
79%
79%
% of organizations achieving
outcomes with hybrid cloud:

11. © 2016 IBM Corporation
Russia’s renowned Mariinsky Theatre was looking to
expand its global reach by live-streaming opera, ballet
and orchestra performances. The quality of the
streamed content was a critical priority.
By connecting its existing infrastructure to a scalable,
high-performance cloud hosting solution, the theater
was able to reach new audiences and accommodate a
fluctuating number of viewers on its digital content-
streaming platform.
As a result of this hybrid cloud deployment, the theater
was able to cut capital expense by US$20,000, boost
performance by 30 percent and accelerate
infrastructure deployment by 99 percent.2
Hybrid cloud paves path for digital entertainment
11

12. © 2016 IBM Corporation
Frontrunners use hybrid cloud to jump-start next-generation
initiatives that keep them on the cutting edge
12
Chasers Challengers Frontrunners
Frontrunners
vs. Chasers
Commercializing insights 2.9x
Cognitive computing 5.1x
Internet of Things 1.7x
14%
21%
7%
16%
21%
15%
40%
36%
36%
% using hybrid cloud to enable:

13. © 2016 IBM Corporation
Hybrid cloud is a common enabler of strategic
next-generation initiatives
13
Commercializing insights from visual data
Switzerland-based nViso developed a facial
imaging solution that captures and
deciphers human emotions in real time,
using video streams from webcams, mobile
devices and in-store cameras.
Recognizing an opportunity to revolutionize
customer sentiment analysis in the retail
sector, nVisio adopted a hybrid cloud
solution to offer new ways
to analyze real-time data assets extracted
from videos of customers.
With the flexibility to run facial imaging
solutions in hybrid environments, nViso’s
clients can work with customer data
wherever it is stored and gain insight into
how customers’ physical reactions affect
their purchasing behavior.3
Applying cognitive insights
Finland’s largest airline, Finnair, aimed to
improve customer experience by offering
new digital services, while also managing
costs and growing revenue.
The airline leveraged the flexibility of a
hybrid cloud platform to integrate new cloud
services with its existing infrastructure. As
part of its digital transformation, it started
using cognitive capabilities to improve
employee productivity by enabling agents to
more quickly find responses to customer
needs.
With implementation underway, Finnair
hopes to gain operational efficiency, reduce
complexity and establish a foundation to
support new growth initiatives.4
Connecting homes and businesses with
Internet of Things smart data
Shaspa, a leading global vendor of smart
solutions for both home and office,
collects sensor data from residential
and commercial spaces. In order to
enable sophisticated analytics on that
data, information needs to be stored and
processed seamlessly.
By building a hybrid cloud-based IoT
platform to connect and control a variety
of environments, Shaspa was able to
connect building automation systems,
household appliances and mobile
platforms from hundreds of global
manufacturers.
As a result, Shaspa can deliver real-time
intelligent analytics to optimize living and
working conditions while reducing costs
through smart automation.5

14. © 2016 IBM Corporation
Frontrunners don't always think hybrid is easy—they're very likely
to cite management complexity and security as concerns
14
70% of Frontrunners
say that their hybrid
environment is causing
them greater security
concerns
77% of Frontrunners
report that hybrid cloud
introduces greater IT
management
complexity into their IT
environment
How are they overcoming these challenges
and gaining more value than others?

15. © 2016 IBM Corporation
How do Frontrunners thrive?
15
Deliberate and comprehensive
hybrid strategy
Hybrid transforms
culture
Advanced hybrid
management
Improved security
& data protection

16. © 2016 IBM Corporation
Frontrunners are more intentional about their hybrid cloud strategy
and bring both IT and business leaders to the table
16
Chasers Challengers Frontrunners
Frontrunners
vs. Chasers
Have an enterprise-wide
strategy for hybrid 3.0x
Believe hybrid is essential to
their mobile initiatives 1.8x
Drives more collaboration
between IT and Line of Business 1.7x
Reduces shadow IT 2.1x
Increases role of business
leaders in IT decision making 1.7x
Increases CIO's role as an
advisor to the business 1.6x
44%
19%
49%
46%
38%
53%
35%
69%
59%
57%
Hybrid transforms culture
47% 59% 73%
76%
81%
85%
83%
68%
Comprehensive
strategy

17. © 2016 IBM Corporation
Chasers Challengers Frontrunners
Frontrunners
vs. Chasers
Believe open technologies are
essential for portability and
interoperability
2.1x
Manage a growing number of
platforms with hybrid 1.7x
Highly integrated service
management 2.6x
Advanced automation
to manage hybrid 2.9x
Prescriptive or predictive real-time
analytics to manage hybrid 5.1x
Hybrid helps ensure availability
and access to critical data 1.6x
Hybrid improves security
and reduces risk 1.6x
Hybrid helps meet compliance
requirements 1.6x
Hybrid helps achieve
data protection 2.4x
Frontrunners are better at managing security and the complexity
of growing hybrid environments
17
Advanced hybrid
management
Improved security
& data protection
38%
40%
50%
50%
50%
49%
60%
62%
25% 46% 61%
32%
26%
53%
51%
10% 21% 51%
84%
82%
76%
63%
73%
78%
85%
65%
79%

18. © 2016 IBM Corporation
The Frontrunner playbook
Think big
picture
Move from
vision to reality
Advance digital
innovation
Shape the
future
Collaborate across the
business to develop a
comprehensive hybrid
strategy that can take
advantage of existing
infrastructure investments
and the flexibility of cloud.
• Are your IT and business
leaders joining forces on
the organization’s needs?
• Does your strategy inform
clear implementation and
integration plans for your
hybrid environment?
Apply advanced
technologies to better
manage complexity and
secure hybrid environments.
• Can predictive or
prescriptive analytics
provide insights for
improving the operation of
your hybrid environment?
• Are you using open
technologies to increase
interoperability and
portability across your
hybrid environment?
Move beyond foundational
gains of efficiency and
productivity to high-value
digital business benefits
such as faster innovation
and increased customer
engagement.
• How can hybrid
capabilities help you
accelerate development
of digital services to grow
your business?
• How are you expanding
and connecting your
ecosystem of partners
and customers?
Pilot emerging technologies
and next-generation
initiatives that establish
differentiation across
industries and disrupt
markets.
• Can hybrid cloud enable
your foray into cognitive
computing to create
intelligent systems?
• Can hybrid cloud help
spearhead your IoT
initiatives to connect
devices and data for
business gain?
18 © 2016 IBM Corporation

19. © 2016 IBM Corporation
APPENDIX
19

20. © 2016 IBM Corporation
Leaders gain competitive advantage through hybrid cloud, enabling
digital transformation and next-generation initiatives
• 70% of hybrid implementers report they will always have a blend of traditional IT and cloud
• 9 in 10 leaders say hybrid is crucial to their strategy and gives them greater ROI than
all-traditional or all-cloud environments
• 85% of leaders report that hybrid cloud is accelerating digital transformation in their
organization
20
How do leaders thrive?
Deliberate and comprehensive
hybrid strategy
3x more likely to have an enterprise-wide
hybrid strategy
Advanced hybrid management
5x more likely to use advanced prescriptive
and predictive real-time analytics
Hybrid transforms culture
2x more likely to report hybrid cloud helps
reduce shadow IT
Improved security & data protection
Over 2x more likely to say hybrid cloud
eases data protection
Source: IBM Center for Applied Insights study “Growing up Hybrid: Accelerating digital transformation”
Leaders gain more value from
hybrid cloud—improving
productivity, reducing costs and
maximizing traditional IT
Leaders are 4x more likely to be
using hybrid cloud to launch new
digital services
Leaders are 5x more to be using
hybrid cloud to drive initiatives in
cognitive computing
Efficiency & productivity Digital business Next-gen initiatives

21. © 2016 IBM Corporation
We surveyed 500 hybrid cloud implementers worldwide to
understand how hybrid is impacting their organizations
21
Growth markets surveyed: China, India, Brazil. Mature markets surveyed: USA, UK, France, Germany, Denmark, Finland, Norway, Sweden, Japan,
Australia. To smooth possible geographic distortions, responses were weighted based on an IBM assessment of each country’s total IT spend.
Respondent distribution (spanning 13 countries and 23 industries)
Mature
markets
71%
Growth
markets
29%
Geo
C-Level
28%
IT Executive
20%IT Director
25%
IT Manager
27%
IT Role
< 1000
27%
1,000-2,499
20%2,500-4,999
18%
5,000-9,999
15%
10,000+
20%
Organization size
(no. of employees)
Hybrid cloud is the connection of traditional IT systems to one or more clouds and/or connection of one or more clouds to other clouds.

22. © 2016 IBM Corporation
Sources
1 “Cxense agilely delivers online services to customers worldwide with a SoftLayer hybrid
cloud hosting solution,” http://www-
03.ibm.com/software/businesscasestudies/us/en/corp?synkey=I327737E25231Z82
2 “Historic Russian musical theater entertains new global audiences using IBM Hybrid Cloud, ”
https://medium.com/@ibmcloud/historic-russian-musical-theater-entertains-new-global-
audiences-using-ibm-hybrid-cloud-908456abf987#.z5kctaba6
3 “Shaspa: Enabling the internet of things for smarter environments,” http://www-
01.ibm.com/common/ssi/cgi-bin/ssialias?htmlfid=IMC14898WWEN&appname=skmwww
4 “Finnair uses IBM industry expertise, cloud and services to drive digital transformation,
support expansion,” https://www-03.ibm.com/press/us/en/pressrelease/47627.wss
5 “nViso: Using real-time facial imaging to deliver deep insights into customer sentiment,”
http://www-01.ibm.com/common/ssi/cgi-
bin/ssialias?infotype=PM&subtype=AB&htmlfid=YTC03822USEN
22