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Learn from the Leaders in Cloud Infrastructure Adoption

10 Feb, 2017

Did you know that investments in organisational capabilities, rather than specific technology choices, is what’s separating leading businesses from laggards when it comes to cloud migration?

Businesses that have pulled the digital lever and successfully moved to cloud infrastructure say they have unlocked connectivity advantages that are well worth their investment in non-hardware resources.

But simply opting to move to the cloud isn’t a solution to running a better business in a digital world. To ensure you make the right cloud deployment decisions, you need to know what the business leaders are doing with the technology first – to ensure your big bets on the tech is worth your while.

 

HIGHLIGHTS

  • There’s lots of hype around cloud technology, but few reliable facts and benchmarks about the adoption of this technology exist.
  • You must engage with cloud specialists to determine your specific needs and to ensure a reliable transition and ongoing smooth operation of your digital infrastructure to prevent yourself from being hindered by any move to off-site technology.
  • Organisational change is paramount to ensure any move to the cloud is successful, because you don’t want to make a switch only to revert back to hardware again.

 

Switching to the cloud is simple, but you need a tactical approach

McKinsey & Company’s recent survey on cloud adoption covered sectors such as banking, insurance, and healthcare. The firm’s research shows that the banking sector, in particular, faces the most pressure when it comes to adopting digital capabilities, like online and mobile banking applications that allow customers to make payments, check transactions, receive quotes, or update personal information.

“A cloud-based infrastructure is critical for enabling such digitisation in banking,” McKinsey associates, Nagendra Bommadevara, James Kaplan, and Irina Starikova say.

Here are a few snippets of what McKinsey learned from respondents on how they successfully moved, or plan on moving to the cloud:

  1. They take time to strategise to ensure their move to the cloud is successful

“Almost all participants in our survey told us they have been developing cloud programs for five years or more, and this area of development remains one of the top priorities for IT,” McKinsey’s associates say. “The majority of participants say they plan to significantly ramp up the technical capabilities of their cloud programs and have sizable cloud-engineering teams working on this effort.”

To ensure your move to cloud infrastructure is successful you need to allocate time and attention to the transition. For now, leading businesses are building cloud-based platforms with an eye toward flexibility, setting up as private-cloud platforms so that they can avoid any security and compliance risks associated with public cloud solutions.

“However, companies are also building capabilities to facilitate the eventual migration of workloads to public-cloud servers,” the McKinsey associates add. “Their ultimate goal is to develop cloud platforms that can meet all the diverse requirements of critical enterprise systems.”

A handful of McKinsey’s survey participants said they will be taking a more conservative approach toward a cloud transition. These companies are not building in-house cloud platforms – instead, they are relying on vendors to supply cloud environments at competitive rates with intrinsic tech support.

 

DID YOU KNOW?

As more businesses connect to the cloud, organisations must find new ways to deliver services and offerings via a cloud solution. Cloud computing is an ever-changing, highly dynamic platform too, which means you have to constantly work at refining your cloud strategies to ensure you provide a worthwhile employee and customer experience. Gartner reports that more than $1 trillion in global IT spending will be directly or indirectly affected by the shift to cloud during the next five years. The market for cloud services continues to grow, making cloud computing one of the most disruptive forces of IT spending today.

  1. Some companies prefer the public cloud instead of a private cloud

“Participants in our survey have become much more open to the public cloud,” McKinsey’s associates say. “The share of participants who see themselves moving entire workloads (of various types) to a public infrastructure-as-a-service (IaaS) model or platform-as-a-service (PaaS) model is up 15 to 20% compared with previous years’ findings.

So why are companies becoming more receptive to public cloud platforms? It’s because cloud vendors are more aggressively marketing their services to companies.

“Additionally, the economics of hosting applications on the public cloud are becoming comparable to those of some of the most efficient private environments, and security standards are emerging for the public cloud,” McKinsey’s representatives add.

Some of the leading businesses that are looking to leverage public cloud believe that the public cloud can enable a number of business scenarios that are not feasible with traditional or private-cloud infrastructures. “For example, companies could ramp up processing capacity on demand, allowing them to conduct research and development simulations or other labour and resource intensive activities that would be costly if attempted within a traditional processing environment,” McKinsey adds.

You’ll need to make the call as to whether investing in a private cloud will be worth your while, or if a public cloud package will suit you better. Naturally, financial services businesses and companies that work with highly-sensitive data will prefer private cloud.

 

How a move to the cloud is already helping Groupon

As a fast-growing company, Groupon knew that it needed to partner with a leading cloud provider to align its technology strategies with the company’s evolving business goals. Groupon execs say their service provider needed to be customer-focused, with capabilities around scale, security, agility, and support.

By leveraging the right cloud provider, Groupon was able to go from deployment to service delivery in an incredibly short amount of time. Within 41 days, the company was able to switch off its onsite data infrastructure and switch to the cloud.

“As a company that’s seen incredible growth throughout our history, it was important for us to find a cloud provider that could meet our requirements for scalability, customisable high-density power, cooling containment, ISP neutrality and physical security,” says Groupon’s Director of Global Data Centre Operations, Harmail Chatha.

When you’re engaging with a cloud service provider, you need to ask them these questions:

  • How easy is it to scale our cloud platform up or down, to ensure we are maximising its cost effectiveness?
  • How customisable is the cloud platform we’re using, to ensure we can still deliver a unique customer experience?
  • How secure is the cloud platform, to ensure we aren’t at risk of being hacked?

Whether you decide to move to public cloud or a private cloud, the amount of work that goes into how your business processes might change is extremely important. If you need to implement organisational change to ensure all employees are using the cloud effectively, this must become a matter of priority.

You must remember that while the cloud has been built to fuel business success, it’s also a tricky technology to manage. You need an expert partner to ensure your cloud transition is smooth.

 

 

CONSIDER THIS

The four big lessons that McKinsey learned from its research on companies and their move to the cloud are:

  1. First, focus on the migration road map and focus on getting meaningful migration results.
  2. Second, you must look for ways to improve the experience for your cloud application-development teams. It’s challenging to create the perfect cloud platform in your first attempt.
  3. Third, you need to be very clear on your business strategy as you embark on your cloud migration journey. Create a list of the cloud benefits you want from the outset, to ensure you glean those benefits upon implementation.
  4. Fourth, you must have a clear understanding of your operating-model impact when using cloud services at scale. McKinsey says that there are major implications on what kind of skill-sets are required to manage a cloud driven business.

 

Resources:

http://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/leaders-and-laggards-in-enterprise-cloud-infrastructure-adoption

http://www.mckinsey.com/business-functions/digital-mckinsey/our-insights…

http://www.datacenterknowledge.com/archives/2017/07/17/sponsored-groupon-a-west-coast-hyperscale-cloud-case-study-and-success-story/ 

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