The COVID-19 pandemic has changed the way organisations do business. A gamechanger and lifesaver for many organisations has been the availability of cloud computing.
With its flexibility, reach, scalability and agility, cloud has enabled organisations of all sizes to scale up or down quickly based on their needs. It has also allowed organisations to achieve their business outcomes in the face of an unprecedented time as we move towards a new normal post-COVID and with remote work set to continue into the foreseeable future.
Cloud has been one of the most widely adopted technologies during this pandemic and now considered as an integral component to any IT strategy.
Once seen as something that could be put off, a successful cloud transformation is now a matter of survival, as businesses and their customers become more reliant on technology due to the pandemic. According to GlobalData, the cloud market in the APAC region is projected to grow 117% from USD$133 billion to $288 billion in the years between 2019 and 2024.
But too often, businesses undergoing a cloud transformation fail to realise their expected outcomes.
While C-Suite leaders know the advantages of the cloud, they don’t always have a clear idea how to carry out a structured transformation. As a result, cloud solutions are implemented in an ad hoc manner, resulting in increased costs, higher business risk, slower delivery, and poor ROI.
Understanding the Triggers for Change
When adopted properly, cloud technology has huge potential for value creation and innovation. Moving IT infrastructure and services to the cloud is a decision influenced by many internal and external drivers, and understanding those drivers is the first step in preparing a structured case for cloud.
There are a myriad of reasons why businesses are making the move to cloud. These can include increasing security and data protection, reducing costs and increase long-term savings, increasing product and services speed to market, delivering higher availability and scalability, identifying risks and recover from failures quickly, replacing legacy IT systems and maintaining a competitive advantage.
Additionally, external factors such as expiring IT hardware contracts, mergers & acquisitions or business decoupling may also influence a move to the cloud.
Out with the Old, In with the New
For many businesses, cloud presents an opportunity to move away from lock-in contracts with expensive, unresponsive consultancies and shift to an efficient, cost-effective cloud solution offering more tangible business and IT benefits.
A switch from the traditional model to a cloud solution can mean:
- Enhanced customer experience: Offering improved services through online and mobile channels, greater product selection, and faster delivery.
- Ability to innovate: Leveraging mobility, social media, the cloud, big data, IoT, AI and other disruptive technologies to increase competitive advantage.
- Reduced operational costs: Lower costs of business operations and improved financial performance through operational excellence.
Creating A Business Case
The real value of cloud becomes evident when a holistic and transformational approach is taken, with the business case forming the foundation of your migration strategy.
Step 1: Determine both the business and IT drivers
Identify what needs to change, and why, considering all stakeholders and their needs. Typically, organisations are driven by a need to increase data security, lower running costs, reduce risks, increase speed to market and drive innovation
Step 2: Map the current environment
A solid understanding of the current IT ecosystem is key to a successful cloud transformation. The business plan should highlight existing business and IT interactions, noting complexities, interdependencies, business-critical issues and priorities for improvement.
Step 3: Quantify costs, investments, and strategic opportunities.
While cloud brings about many direct IT benefits, the business benefits may not be immediately apparent and should be emphasised in the business case.
The costs of the program however, will be apparent at the outset. Cloud requires an investment in the technology and the team to maintain it. It’s unlikely your existing team will have the skills to do this, so you will be entering a competitive market for DevOps and CloudOps specialists.
By emphasising the wider benefits, you can avoid having cloud considered as purely a cost centre, not the strategic investment it should be.
Step 4: Identify and evaluate cloud alternatives and benefits.
Choosing a cloud solution or provider — for example, AWS, Microsoft Azure or Google Cloud Platform — is one of the key steps in planning a cloud transformation, and shouldn’t be a decision made solely by the CIO. The final call will come down to which solution offers the best fit for ongoing business needs while delivering new capabilities for innovation through technology.
Step 5: Calculate ongoing cloud ROI
ROI calculation can be used as a key indicator for validating your business case. This involves analysing the benefits of reduced IT costs, identifying the investments required for a new solution, and projecting the costs and potential savings over a fixed period.
So if you’re looking to enable operational resiliency, require flexibility while maintain business as usual in the face of uncertain business conditions, cloud will need to be a critical element in your IT strategy and tool kit moving forward. Cloud adoption is no longer an ‘if’ for organisations, but ‘when’ as it’s proven to be essential for business survival and will give organisations the edge in achieving optimal business and technology outcomes.
Mike Middaugh is Managing Director at Stax