My best clients have been migrating their on-premise line-of-business applications to the cloud, with varying degrees of adoption. In the coming series of articles, I’ll explain some of the business drivers for this transition, high-level technical considerations, and challenges for the organization.
Part One: Business Drivers for Change
All organizations are under increasing pressure to maximize their return on technology investment. As budgets shift funds from IT to marketing, the IT organization seeks to save costs. Leveraging a cloud provider, as opposed to maintaining on-premise infrastructure, takes advantage of economies of scale to consume more computing power at lower costs.
Moving to the cloud allows for investment using operational expenditures (OPEX), rather than capital expenditures (CAPEX). CFOs no longer concern themselves with depreciating assets, and large lump-sum investments in infrastructure. This approach frees cash for investment in other areas of the business, and reduces the footprint of the IT department as a cost center in the organization.
Many of my clients are e-commerce companies, and often have to prepare their infrastructure for peaks in traffic. They usually do this by purchasing far more equipment than is needed for typical demand, and often hosting in redundant data centers to mitigate the risk of downtime. Cloud environments allow for flexible computing power that scales on-demand, paying for only what is required.
Security concerns, maintenance, and upgrades account for significant investment in both service agreements and labor. Many cloud infrastructures eliminate or greatly reduce the constant demand for mundane maintenance tasks. Cloud providers with more specialized staff and a greater focus on security can offer CIOs peace of mind.
My favorite reason to move to the cloud is speed. What used to take weeks or even months to spec out, order, provision, and configure, and can now be done in hours or less. This allows organizations to rapidly respond to changes in market demand, and the organization can better avoid the losing proposition of an on-premise physical infrastructure.
In my next installment, I will examine some of the options for moving an on-premise line-of business application to the cloud. Stay tuned…
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