Successfully switching an organisation’s IT environment to a public or hybrid cloud model takes more than just selecting the right provider. CEOs and CFOs also need to achieve effective cloud deployment to manage the organisation’s total cost of cloud ownership (TCCO).
Business leaders recognise that cloud deployments aren’t just about saving money, but even so, reducing the TCCO is still an important goal. To do so, there are a number of key factors CEOs and CFOs must take into consideration.
Comprehensive cloud solution
Decision-makers must choose a cloud solution that is able to meet the needs of different stakeholders across the entire organisation, not just within internal IT or a specific line of business. While this may seem self-evident, lines of business and IT teams have different uses for cloud and, as a result, may require a different kind of cloud deployment. The alternative of selecting more than one cloud vendor increases complexity, making a payoff harder to achieve, so this should only be done if a business case can justify the duplication of resources.
It is important that the chosen cloud partner can deliver powerful capabilities to support organisational IT policies and governance. Clouds that are operated by ‘shadow IT’, that do not conform to such policies, can add significant risk and cost to the organisation, for example introducing security issues, support issues and reducing commercial leverage.
Cloud time management
One often-overlooked aspect of TCCO is the cost of time taken to manage the cloud. For example, clouds that are complex to configure and operate will add people-cost to TCCO. On the contrary, clouds that offer tools that simplify and automate provisioning and management will save time and enhance speed-to-value. In particular, clouds that offer self-optimisation of resources (reducing them automatically to match real world demand) can save a great deal when compared to clouds left to ‘run’ at full pace without the actual demand to warrant the spend.
When it comes to choosing the right model to improve TCCO, IT-as-a-Service (ITaaS) is usually ideal. It offers a single platform to deliver cloud infrastructure, integration, platform services, and governance. Getting all the benefits of ITaaS depends on choosing the right cloud provider. Decision makers should look for a provider that has a mature ITaaS offering with strong service level agreements (SLAs) in place.
Establishing SLAs with cloud providers is also key to effective cloud management. CEOs should avoid partnering with providers that don’t offer enterprise-grade SLAs because this increases the risk of downtime, with no accountability or recourse to the cloud vendor.
However, more isn’t necessarily better when it comes to SLAs. For example, if the organisation operates in a single geographic area, it makes sense to choose a cloud that provides a high-availability solution within their zone only. This means they are not paying up to double the cost for a multi-region deployment they don’t need.
CEOs must therefore make it a priority to partner with a cloud service provider with industry-leading SLAs that will support business-critical applications running in either a single cloud zone or globally, depending on their needs.
When reviewing the provider’s SLAs, it’s important to first consider the organisation’s policies regarding data preservation, redundancy, seizure, location, and privacy. Decision-makers should gain a clear understanding of the provider’s position on guarantees, services to be covered, excess usage, licensed software, payment and penalty methods, subcontracted services, and industry-specific standards.
Different SLAs are also likely to apply to Infrastructure-as-a-Service, Software-as-a-Service, and Platform-as-a-Service, as business demands on these models may vary. As complex as this can be, putting the right SLAs in place for the organisation’s needs can have a dramatic impact on TCCO, so it’s worth investing time to thoroughly scrutinise the different SLAs and compare them against performance objectives.
Organisations must also consider what metrics they will use to measure those performance objectives, how the cloud provider will deal with security breaches or service outages, and, importantly, how to terminate the relationship if the provider isn’t meeting expectations.
Conducting regular assessments and audits to ensure the cloud provider is delivering to the agreed standards will help organisations to get the best possible cloud performance and reduce the total cost of cloud ownership. In turn, this helps the organisation to grow and stay ahead of the competition.