In a recent client meeting with an IT infrastructure team, the client shared with me that IT was forced to do a 180˚. The business drove the decision to push their private cloud computing environment to the public cloud.
Beyond the decision to move to the cloud the business didn’t request IT’s input on which public cloud platform supported the best business case with a realistic ROI. The business told IT which cloud platform provider IT would need to move to and when.
Sometime in 2012 and previous to this new directive, IT determined that a private cloud option would serve the business needs most effectively with an ROI within 24-36 months and significant cost-savings year-over-year. Time to market, updating to meet regulatory changes, security, operational readiness, resourcing, support and other factors would be more effectively managed in a private cloud environment.
Based on this determination, IT undertook a large-sale project in 2012 and 2013 to build their private cloud including a significant investment in on-site hardware, software and services. Then in the Fall of 2014 they were being instructed to forsake a return on that investment and undertake a new project to move 90% of their computing needs to the public cloud.
While I’m confident there are many other factors to consider here, I asked the question no one had an answer for:
“What do the financial cost models look like for public cloud ROI beyond 3-5 years?”
The comparative financial models for moving to the public cloud were not built and were not considered in the decision the business had made.
Cost models should be considered and compared independently of which direction the business pushes for. It’s an IT responsibility to establish the cost models; however, these models are complex and an inexperienced team can overlook important factors. Simplified cost models may include hardware licensing, installation, configuration and maintenance, but often are so simple that they miss the migration costs for moving applications, ongoing support or understanding system limitations for database management, transaction and data transport costs and optimized computing and storage options.
At Redapt, our team is well-versed in building public, private and hybrid cloud environments. In our work with 1,000+ clients we strive to be agnostic in our assessments and recommendations. Clients trust us to have their best interests in mind to objectively evaluate, recommend, design, build and deliver robust cloud solutions.
We also host on-site cloud workshops, helping companies evaluate their current environment and guiding them to the best cloud provider options for ROI to support both IT and the business.
Contact me today at firstname.lastname@example.org to learn more about our unique services as you consider next steps in your cloud computing environment.