The ability to articulate your organization’s cloud strategy is crucial for today’s IT leaders. An NFL coach wouldn’t show up on Sundays without a game plan, and a pilot wouldn’t take off without one for their flight. With IDG predicting that 28% of organizations' total IT budgets will be dedicated to cloud computing in 2017, a well-formed cloud strategy is an expectation for any IT leader today. But having a strategy is not enough.
Even the best-conceived cloud strategies are prone to failure if they aren’t built from a deep understanding of the facts about cloud economics and how public cloud costs compare to existing IT investments and on-premises infrastructure. Without that foundation, it’s difficult to know where cloud investments should be placed and if and when they will pay off.
Additionally, if cloud strategies aren’t anchored in fact-based data, it is nearly impossible to set realistic goals and to monitor the progress of cloud initiatives over time, or to quantify and communicate the impact of cloud investments to the rest of the organization.
3 Ways to Bulletproof Your Cloud Strategy
Want to ensure the success of your cloud strategy? Here are three steps you can take to bulletproof your cloud strategy.
1) Get your arms around your public cloud spending
A good starting point is to know how much of your total IT budget (and ideally the entire organization budget) is going toward public cloud across SaaS, PaaS, and IaaS vendors. It’s a simple starting point but one that can be surprisingly elusive. In part, this is because nearly a third of enterprise cloud spend comes from outside of IT.
You need to be able to take non-standard billing statements from the likes of Azure, AWS, and other cloud providers and bring them into one aggregate view of costs. Apptio automates this process with connectors to 3rd party cloud providers that bring cloud spend data into one place and parses through it so you can understand more than just aggregate spend. You’ll be able to know the details about what your cloud spend is going toward and how it is trending over time. This data helps establish a baseline for the current state of cloud spending, so you can base your strategic goals on today’s realities.
2) Understand cloud costs in the context of overall IT spend
Once you have sized up your public cloud spend, you need to know how it compares to the amount of spend in the rest of your IT portfolio. This is your agility barometer. While “bimodal IT” is not a new concept as it relates to separating “keep-the-lights-on” spending from other investments aimed at driving growth, the Cloud offers inherent advantages in terms of flexibility and scalability. Therefore, separating these ensures you know that your IT services and the business units that consume them have the right mix to support the innovation goals of each.
When you better understand your public cloud spend compared to your entire IT portfolio, you’ll be able to set reasonable and appropriate targets for cloud adoption by workload type, business priority, cloud modalities, and even specific business units. This allows you to measure, monitor, and influence progress against your cloud adoption goals over time.
Apptio Cost Transparency brings all of your spending into one place across physical, virtual, and public cloud infrastructure so you can view the full cost of your entire application portfolio down to each individual application regardless of where it is hosted.
3) Compare public cloud costs to private cloud costs
All cloud spending is not created equally. Depending on need, use case, and modality across SaaS, IaaS, and PaaS providers, pricing and cost impact can vary dramatically. The important thing is to be able to baseline your cloud costs to get a “like-for-like” view of spending and answer the lingering question that echoes through all cloud corridors: “Will I save money by moving XYZ to the Cloud?” To answer this you need to understand the total cost of ownership (TCO) or fully burdened cost of both private and public cloud investments that include labor, support, and other overhead and infrastructure costs. Apptio’s cost allocation engine automates this process, so you are always able to view your current TCO and weigh that against public cloud technologies.
To understand how cloud fits into the IT strategy, IT leaders need to make sure their assessment is based on facts about cloud economics. With a sound cloud strategy in place, you can improve developer productivity and optimize the performance, availability, and cost-efficiency of cloud applications.
Learn more about optimizing cloud costs in our executive brief: Demystifying Cloud Costs.