Why is cloud costing more and delivering less?

Why is cloud costing more and delivering less?

When cloud computing burst into being it was cited as the solution to a multitude of problems. It promised to deliver significant cost savings, reduce complexity, increase flexibility and improve security. Years later, cloud computing is now an established and widely adopted technology, with 50% of enterprises having workloads in the public cloud. So why is it that some believe cloud isn’t delivering on those promises?

The truth is it’s not the technology that is at fault. It’s how people are using it. More often than not, when Cloudscaler talks to our clients, we find that it’s the cloud strategy, governance and cloud operating model that are the problem. When organisations get these foundations wrong, costs spiral out of control and organisations fail to realise the value of their cloud programme. In this blog I highlight what is causing those rising costs and how to ensure you can capture value from cloud.

The root cause of cloud frustration

Many organisations are frustrated by cloud because it hasn’t delivered what they thought it would. They may have been hoping for significant cost savings, efficiencies or security improvements. Or their aspirations may have been to deliver a continual flow of improved services to customers, citizens or employees.

The most common reasons we see for a lack of innovation delivery and business benefit from cloud are:

  • Competing cloud platforms: tempted by the promise of cloud, product teams dive in without a central cloud strategy or approach – this leads to multiple cloud platforms, all configured slightly differently and built with varying levels of diligence. This in turn leads to inconsistencies that increase risk, reduce delivery pace and undermine service levels.
  • Lack of a unified, clearly communicated cloud strategy: to migrate at scale, organisations need a clear cloud strategy that is effectively communicated. To ensure progress and delivery aren’t hindered by bureaucracy, it is vital that traditional waterfall governance evolves into an agile approach and flexible operating model. Without a clear cloud strategy and agile governance, we find cloud transformation often stalls.
  • No centralised tools, services and controls: if a central cloud team doesn’t provide delivery teams with the cloud services and tools they need, those teams will have to build their own before they can use the cloud effectively. This takes time, slowing delivery pace, but also results in duplication of effort across delivery teams.
  • A ‘big bang’ cloud platform: focusing on building the perfect cloud platform before starting to move workloads is a huge mistake. Just like waterfall delivery projects, this approach tends to mean the cloud platform is delivered late and over budget because it becomes too big and complex. While the build is ongoing, costs are duplicated across cloud and on premise. But that’s not all. Product teams get frustrated and can go rogue, creating their own platforms because they don’t want to wait for the slow to arrive central platform.

Top tips for realising value from cloud

Organisations that are seeing value from cloud are avoiding the pitfalls by adopting a completely different approach. They get their strategy and operating model right. They implement a single, secure cloud landing zone. A landing zone is an infrastructure layer between the hyperscaler account and the business application teams who build and run their applications on the cloud.

A landing zone provides common cloud standards, tooling and services that mitigate the risks of running cloud-based production services – effectively encoding and mandating the risk stance of your organisation. It also simplifies cloud use for product teams which increases delivery pace. This increased speed means more workloads are live and organisation-wide cloud-related cost savings can finally be realised.

If your cloud strategy includes a comprehensive cloud landing zone and a well thought through cloud operating model, you have the foundation for cloud success.

Ditch the DIY approach

Organisations need to stop thinking that their requirements are unique and that they need to build a bespoke cloud platform from scratch. There is no need to reinvent the wheel. Building your own platform is a huge undertaking that will take a long time, be plagued by trial and error, and will probably cost a fortune.

There are already cloud services and products out there that can help you get your cloud foundations right and ensure your use of cloud delivers business benefit – and without costing the earth. By using best of breed cloud solutions coupled with the implementation of an effective cloud operating model and governance framework, you will reduce costs and accelerate the cloud transformation journey, unlocking the elusive benefits of cloud far more quickly.

Resources to help you get more from cloud, but spend less

We recently published a whitepaper which explains the hidden costs of cloud transformation. It gives transformation leaders top tips on how to avoid those costs, accelerate their cloud transformation and realise the value of cloud. You can download it here.

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