Cloud adoption: Evolving your strategy to maximise the benefits

With much of the conversation about business transformation having focused in recent years on cloud migration, the reality for many businesses who have taken a ‘cloud first’ approach is they end up stuck halfway through the process, having spent a lot of money, wondering how to move forward.

Businesses can end up investing so much in cloud migration that they never manage to drive the outcomes they want because they're continually spending on partnerships which aren't delivering fast enough.

In particular, they may find themselves beholden to their cloud service provider, trapped in ‘vendor lock-in’, where the financial and logistical challenges of migrating to a rival platform appear too great to overcome. 

With licensing costs for cloud computing steadily increasing, and businesses facing other CapEx and OpEx challenges, there is an urgent need for them to optimise their cloud usage and fully leverage the benefits to drive down their costs over time, modernise their business and transform their IT structure.

Defining success

All too often, when organisations are outlining a business case for moving to the cloud, the one thing they haven’t done is define the outcomes they are trying to achieve. The decision is typically born out of the desire to exit a data centre, with the focus on driving a fiscal outcome rather than leveraging all the capabilities the cloud can offer: availability, scalability, recoverability, increased security, innovation, faster time to market, and so on.

One reality organisations must face is that adoption of the technology alone will not deliver all of those outcomes. Without developing new ways of working, without driving unity across different teams in the business, and without building an IT structure and operating model which aligns to cloud technology, organisations will struggle to move forward with their programme.

The starting point for any cloud transformation should be a clear strategy, therefore, but in our experience many organisationdon’t typically do this – they’re too busy fighting fires. 

Businesses also need to go back to defining what they need as organisation and their motivation for cloud adoption, so that they can leverage their investment in cloud capabilities.As part of that, theyneeds to define what successful adoption looks like. 

The cost of excess baggage

The cheapest entry point into the cloud is rehosting, known as a ‘lift and shift’ migration,where the organisation doesn’t change anything about its existing IT estate, but simply packs all its legacy suitcases, carries them into the cloud and dumps them there. This typically leaves clients wondering why the outcomes from cloud migration are no better than with their previous IT infrastructure.

Organisations who are exiting a data centre to move into the cloud have an expectation the solution will be cheaper for them to run, more secure, and faster to deliver, but if their business is not strategically aligned with the cloud they typically end up with higher costs and few of the anticipated benefits.

Additionally, firms that have historically approached IT innovation with a CapEx mindset -investing a lot of capital in new hardware, with a view to sweating those assets over the next few years – may take the approach of treating the asset as an ‘all you can eat’ buffet, where capacity is continually increased. However, in the cloud they will find they are paying for every single item from that supposedly unlimited buffet. 

To use another analogy, it’s like the organisation is keeping the kitchen tap running constantly just in case it wants to take a drink of water every now and then. Only it is no longer paying water rates, it’son a water meter, andis being charged a fortune for all the water it hasn’t drunk. It’s pouring money down the drain.

Overcoming the CapEx mindset

To avoid cloud adoption being just another hefty cost centre with limited benefits, organisations need to focus on all three elements of technology, people and processes.

The operating model of the business needs to mature at the same rate as the cloud, which means re-architecting applications to turn on and off, or scale up and down, based on demand, rather than always being ‘on’.Modern cloud services involve a concept called ‘serverless computing’ where clients only pay for services when they are using them for live transactions.

An example of how this could work better for companies in the insurance sector is with modelling applications. When used on-premises, they typically require high-end hardware that is used in short bursts. From a CapEx perspective, after the initial investment, it costs nothing to continue using the modelling application. 

However, in the cloud, where it will require a high level of resource but is only used rarely, the application will end up costing a lot of money to use in the previously mentioned ‘all you can eat’ mode. If deployed via serverless computing in a more modern cloud architecture, however, the modelling app will be far more cost-effective. 

Taking a cross-functional approach

Many cloud adoption projects end up being rushed, because companies are trying to move to the cloud at speed and drive instant outcomes. As we said at the beginning, technology by itself is not going to drive the outcomes and the value that the cloud can provide. Successful adoption requires a holistic approach that is as much about refocusing on process and challenging the status quo. 

Perhaps the biggest challenge organisations face in successful cloud deployment is the availability of onshore technical expertise at an SME level, that can advise clients on how to optimise cloud usage, and will help organisations navigate the most strategic route to migration.

Working with a consultancy that gives access to onshore talent that lives and breathes the cloud, and can bring a cross-functional, multi-skilled approach to re-architecting your organisation’s cloud strategy, will enable firms to develop an approach that focuses on outcomes first.

This cross-functional approach doesn’t lend itself to the offshore model, where the tendency is to divide infrastructure, services, apps, networking etc between small, single-skilled teams that need to be trained up to carry out individual operations. The cloud works much more holistically, requiring people with a greater depth of experience and the ability to think across different areas of the business and work out how they join up. 

With greater use of automation for scripting and the development of infrastructure as code, much of the deployment process can be automated, meaning a large offshore function can be consolidated into a much smaller onshore team, able to move faster across the whole platform and infrastructure. 

The traditional structuring of IT capabilities into separate verticals is typically replicated in the offshore model, and often means the teams running network, sysadmin, and apps don’t talk to each other. The cloud makes it possible to break down those barriers and unify separate teams with a single running narrative and effective communications.

And with a cloud provider like Microsoft able to manage the configuration of a company’s cloud infrastructure, the location of its apps, and so on, one person can effectively deliver the landing zone for a firm’s entire cloud deployment.

Realise benefits early

The key principle with cloud adoption, which goes back to the concept of agile delivery, is to try and realise the benefits early because as the organisation starts to deliver those benefits, it can begin to figure out what it really needs from the cloud. 

Organisations, therefore, need to plan their direction, know their purpose, and outline their objectives in advance. Once they have a broad idea of how to approach adoption, they can start to build in good practice around the foundations, the technology frameworks, the applications, and the services.

Ultimately, we can help clients realise many benefits from being in the cloud, but it’s not just about delivering a technology solution. It’s about trying to understand from a business perspective what drives a client’s revenue, what services they use to drive it, and how the technology can help improve those services. 

We can sit alongside the client and use business analysts to understand how technology can expedite this, help them modernise those applications and services based on value, and start realising those benefits. 

Ready to turn your cloud strategy into a true success story? We’re here to help you align your cloud initiatives with your business goals, creating strategies that drive real results. Let’s work together to transform your cloud journey into a powerful tool for growth and innovation. Reach out to our managing partner, Mark Weller: mark.weller@ecmanagedsolutions.com