“New year, new cloud strategy!” This is the mantra for many organizations who are approaching 2021 with optimism and a clear eye view about how shifting to the cloud will help their business become future-ready. As the great Boromir once said, “One does not simply move to the cloud”. Or something like that at least. The road to cloud riches starts with an understanding of the true cost of migrating to the cloud is. This requires IT leaders to have a complete picture of what the ongoing costs of their current IT operations is, both direct and indirect. The distinction between these two, however, is not always clear. The good news is that it doesn’t have to be. All you need is a framework that includes the relevant, associated costs.
As organizations try to identify the low-hanging fruit that comes from accelerating to the cloud, shifting from a Capital Expenditures (CapEx) model to an Operational Expenditures (OpEx) model stands out immediately. One key reason is that direct costs are much easier to calculate and this helps make the budget much more reliable and predictable (to the delight of CFOs).
Ask your finance team what having a reasonably accurate picture of your on-going IT needs would mean to them. Chances are they would instantly become your best friend. This is one of the advantages of calculating your current IT costs and it helps you set a baseline for determining your potential cloud infrastructure requirements. Building out a realistic projection of your cloud operations will also require at least some understanding of your cloud environment to the table as well.
Leveraging a TCO model or ROI calculator will help you plan out what the move to the cloud would look like for your specific business needs. Do you plan on implementing it as a one-time occurrence or will it be a multi-year phased approach? What percentage of your workloads do you expect to be in the cloud for each of these years? What does your current infrastructure look like now with respect to data center locations, number of VMs, etc. look like?
Arming yourself with this information will help with the accuracy of your TCO savings as well as your ROI analysis. It will also aid in determining what is most practical and cost-effective for your budget like expanding throughput and storage capacity, adding features that aren’t part of your current cloud infrastructure, and eliminating elements that are no longer necessary.
Implementing some or all of these elements will help set your organization on the right track to make it rain in the cloud.
Interested in finding out the benefits of moving to the cloud for your specific business? Get your own personalized report with the vRealize Cloud Universal ROI calculator.