December 1, 2021

Accenture to invest $3B in new 70,000-person Cloud First business unit

Consulting giant Accenture plc is investing $3 billion in forming a new business unit that will focus on helping enterprises adopt the public cloud. 

The Cloud First group, which Accenture announced today, comprises about 70,000 professionals who will work under the leadership of longtime executive Karthik Narain. Narain was previously responsible for Accenture’s technology services in North America. 

Accenture is one of the world’s biggest providers of professional services, helping large organizations with information technology initiatives and other projects. The cloud was already a big part of its business before today’s announcement. Cloud projects accounted for approximately $11 billion in revenue during fiscal 2019, about a quarter of Accenture’s total sales that year, and it has more than 100,000 employees focused on this area. 

The Cloud First group, with its large workforce, will likely encompass a significant part of the company’s cloud operations. Accenture described it as a “multiservice” group that will specialize in areas including cloud migration, application services and infrastructure, among other things.

The $3 billion the company has earmarked for the group will be invested over three years. Key focus areas will include “cloud tools, assets, and automation to drive lower unit cost” as well as “research and development in edge computing and related cloud technologies,” Accenture said. 

“With most businesses currently at only about 20% in the cloud, moving to 80% or more rapidly and cost effectively is a massive change that requires a bold new model,” said Paul Daugherty, the head of Accenture’s technology division.

Other major professional services providers, including Deloitte and HCL Technologies Ltd., have also been expanding their cloud businesses to address growing demand from enterprises. The major cloud providers, which benefit from having a strong ecosystem of consulting firms focused on their platforms, actively support their consulting partners’ growth. Google LLC, as one example, this year inked a $500 million agreement with partner SADA Systems Inc. to help SADA provide more consulting services to enterprises looking to adopt Google Cloud.

The search giant earlier also launched a collaboration with Accenture to jointly develop solutions based on Google Cloud services.

Prasad Sankaran, Accenture’s lead for cloud and infrastructure, provided some context on why the company is expanding up its efforts in this area during a May appearance on SiliconANGLE’s theCUBE. “We’ve surveyed several CEOs and CIOs — the number we arrive at is at about 20% of workloads having moved to the cloud,” Sankaran said. “A lot of that work, the next let’s say 30% to 40% [of on-premises workloads] over the next few years. That’s going to be heavier lifting as compared to the initial 20%.”

The full interview is below:

Image: Michael Gray/Flickr

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