One of the most important decisions a company needs to make is choosing the right portfolio of cloud solutions. The right cloud strategy will set the foundation for the company’s future while providing better agility, on demand resourcing, cost savings and IT management. A wrong decision can take years and unnecessary costs to reverse. Due diligence on establishing your cloud portfolio is imperative for this new digital era. As you proceed in this journey, here are some common pitfalls to avoid.
Leaping on to the cloud without establishing a long-term cloud strategy
It could be possible that some departments in an organization would have already moved onto the cloud before establishing a long-term cloud strategy. While these initial decisions act as an ice-breaker, it’s possible that these decisions go against the long-term strategy formulated later. Allowing different departments to move on to the cloud without a cohesive platform could take years to reverse if the decision goes wrong. Splintered cloud provisioning could hinder the opportunity for centralized management, price volume discounts and increasing feature capabilities.
Not leveraging a trusted partner in cloud strategy development and cloud provider selection process
The outcome of the cloud services vendor (CSV) selection process is greatly impacted by the partner leveraged to assist in this process. While a third-party CSV might become a critical part of the cloud portfolio, their intent in selling their solution is not fully aligned with the company’s objectives. CSVs have their own objectives and sell their full stack, instead of a portfolio of different breeds of suitable brands, regardless of utilization, functionality or performance. Additionally, company’s internal departments might not possess the experience or skills necessary to analyze and develop the correct selection processes. Simple mistakes such as improper pricing analysis and hype bias can lead to wrong decisions. The company needs to leverage a partner that is neutral to the selection process, has relationships with the major cloud providers and brings together the required skills and experience in developing and implementing cloud solutions.
Improper cost comparison of private, public and hybrid cloud
The cost comparison of the different cloud solutions is significantly influenced by the formulas and scoring mechanism chosen. It is easy to determine the winner based on the scoring mechanism chosen. CSV’s realize this and it is common to see each cloud vendor claim to provide the best ROI by calculating it under different assumptions or considerations. Some common assumptions or considerations made to do such calculations are:
- Assuming the environment runs close to 100% utilization
- Assuming the IT environment will run only 8x7
- Not including the cost of management and monitoring software
- Focusing only on compute and not including other additional costs such as network and storage costs
- Not factoring in implementation and conversion costs
- Not factoring in the elasticity of the cloud environment, provision and decommissioning
- Not factoring in the cloud vendors’ annual price reductions and negotiated discounts
- Not factoring the delta of internal support costs
- Not factoring in geographic performance costs – speed and data federation
Companies should adopt a cost comparison mechanism taking into account these common manipulation assumptions or considerations to decide on the right CSV.
Misalignment with internal team’s skills
After the cloud portfolio decision has been made, the organization’s internal team will need to support and manage the environment. Choosing a portfolio that is misaligned with internal team’s technical as well as process abilities would raise training and support costs. It is essential to budget additional costs for the team to support and manage the environment with proper training and tooling.
Assuming only certain workloads run on a cloud
The cloud vendors continue to expand their solutions to support all types of workloads. High security workloads and enterprise solutions such as ERPs and CRMs are being transferred to the cloud. It is important to get an impartial technical review of workloads to figure out the best location for managing and hosting it. Sometimes moving legacy workloads on to the cloud are cost prohibitive but there are few workloads that are unable to be placed on to a cloud. Though once the workloads are on the cloud there can be ‘lock-in’ challenges. The IT department and the business processes dependent on the cloud solution will also need to keep moving, changing and evolving. It is advisable to choose workloads carefully as letting certain IT assets depreciate with no utilization is not an option.
The barriers to moving on to the cloud are decreasing constantly and the value provided by the CSVs is growing. It is difficult to decide on the perfect cloud strategy for success. But the possibilities of a right decision can definitely be increased by avoiding the common pitfalls - by formulating a long-term strategy that supports the business, choosing an impartial experienced partner in the CSV selection process and doing due diligence.