For at least the last 15 years, companies have been enticed by the idea of moving their IT infrastructure and business operations to the cloud. Drawn by the promise of modern functionality, rapid scalability, and low up-front costs, technology executives have been eager to adopt cloud platforms as a key enabler of digital transformation.
The COVID-19 pandemic only accelerated the mass move to the cloud, as companies suddenly had no choice but to support employees remotely and launch new business models to serve customers online. And now, even as the pandemic has waned, the business case for cloud remains undeniably strong. Maximizing the potential of the cloud will be essential for long-established companies to stay relevant in a landscape of aggressive digital competitors, tech-savvy consumers, and decentralized employees. Today, about 42% of app portfolios are in the cloud, according to a survey of business leaders by Forrester Research. In two years, that number is expected to increase to 59%.
But as anyone who’s performed a cloud migration knows, it’s usually not as easy and clear-cut as it sounds. That’s why most businesses (except for young digital native companies) have yet to complete a comprehensive transition. Many have claimed victory in isolated cases but haven’t developed a solid strategy to take full advantage of the cloud’s powerful benefits on a company-wide scale.
In a recent webinar, our guest speaker from Forrester, Senior Analyst Brent Ellis discussed the findings of their recent survey on cloud strategies. I joined Brent to offer NTT DATA’s perspective on best practices, which – now more than ever – place great emphasis on delivering a satisfactory user experience.
View the webinar here, or continue reading for a recap of some key discussion points. Also, keep an eye on our blog for more upcoming content on cloud strategies.
Technical advancement depends on people
According to Forrester’s latest data, companies have a variety of reasons for moving to the cloud, but most of them fall into two main categories, explained Brent. First, they want to get out of managing their own infrastructure. Thanks to its subscription-based model, cloud gives businesses access to the latest and greatest capabilities without significant capital expenditures and without the ongoing costs and time required to maintain the equipment themselves. Secondly, companies are looking to increase velocity and time-to-value for technology-related initiatives. In Forrester’s research, “the ability to scale quickly and easily” ranked first (41% of respondents) among all factors driving businesses to the cloud. Second was “freeing up IT staff for other tasks,” at 37%.
While the upsides are attractive, Brent said, it’s only prudent to recognize that moving to the cloud substantially changes how companies work. And with any significant change comes challenges. Notably, many hurdles companies encounter in a cloud migration are less about technology and more about people. The Forrester survey found the top four challenges of migrating apps were:
- training existing staff on cloud services (22%),
- hiring experienced data cloud experts (20%),
- figuring out an optimal work structure to facilitate the change (20%), and
- maintaining staff that has been trained (19%).
From my perspective, these are critical factors that impact a company’s ability to execute technical improvements. They speak to the importance of the employee experience. If employees aren’t properly equipped, trained, and motivated to make a cloud migration successful, any technical gains will be for naught.
As Brent mentioned early in the webinar, understanding cloud strategy may necessitate a shift in mindset. In the prior era of business technology, companies were forced to adapt to computers through the esoteric practice of building and maintaining expansive, highly technical infrastructure. The cloud era turns that notion on its head, as technology must adapt to serve humans on their terms, allowing businesses to focus on what they do best.
Clearing hurdles to get started
Despite the attractive business advantages cloud offers, many companies have difficulty gaining traction with migration. It could be that, in the wake of the pandemic, there’s no longer a sense of urgency to change, and pursuing a migration now seems like a long, expensive, and risky journey. However, the message for leadership is that modernization is just as important today — perhaps more so — due to any number of compelling triggers, whether competitive threats, new customer demands, or a general mandate to innovate faster.
At NTT DATA, a common question we hear from clients is, “Where do we start?” That’s when I bring the conversation back to people; consider which applications touch end-users the most. You’re more likely to get executive approval for projects that impact the most people, which could mean customers or employees. Forrester recommends prioritizing core systems such as billing and demand operations.
Once the wheels are in motion, application development and delivery leaders await another set of hurdles. Moving to the cloud requires them to navigate three big changes simultaneously: adding new talent, selecting new cloud platforms, and adopting nimble, quick software delivery practices. It’s a difficult juggling act, and companies shouldn’t hesitate to lean on experienced cloud partners for assistance.
Five primary approaches
When Forrester asked companies how they’re approaching their move to the cloud, it became clear that most organizations don’t go all-in on any one strategy. Rather, their cloud strategies include multiple methods, depending on the business outcomes and specific application needs. Here are the top five:
- Lift and shift: Simply moving an existing app to run in the cloud, with no other changes, often results in disappointment. The cloud offers minimal added value unless apps are modernized to capture its benefits. However, the lift and shift approach is sometimes necessary if the company is on a tight timeline, such as meeting the requirements of a merger or acquisition.
- Modernize and then move: Modernizing the application before migrating it to the appropriate cloud service is how companies can begin to unlock the real benefits of cloud. It can add tremendous business value, but it’s also important to recognize that this will require different ways of working among stakeholders. For example, adopting Agile and DevOps practices may be necessary to ensure timely and continuous updates.
- Move and then modernize: As opposed to a basic “lift and shift,” this method can work best for companies that have some sort of platform-as-a-service tool in place already. They can migrate that in-house capability to the cloud and do further modernization or refactoring. When done well, it can produce business and operational benefits.
- Replace with SaaS. Leaving behind a legacy application entirely and switching to a software-as-a-service offering can result in a much better end-user experience. It also unburdens the business from maintaining the app itself. The downside, however, is that a SaaS product may be more of an off-the-shelf template, lacking the customization and APIs some users need to access and get value from the app.
- Rebuild an app: Starting from scratch is probably the least pursued method of moving to the cloud. However, it can make sense for certain businesses to completely tear down an existing monolith and remap it to cloud-native services. This process helps them reimagine how the app can and should meet the organization’s modern business needs.
According to Forrester’s interviews with IT executives, the last two methods (replacing with SaaS or rebuilding) typically deliver the most value overall. But I recommend using the best mix of all of them, as determined by the application requirements, desired outcomes, timing, and budget. We see the most successful cloud migrations are those where stakeholders clearly understand the outcomes before the migration begins, whether it be better resiliency, speed/agility, lower cost, or something else. Your migration approach will greatly impact the expected outcomes, so be sure to get a good grasp of the application and the strategies that will help the most.
Technology is not the hardest part
Ultimately, succeeding in the cloud is about achieving the right mix of cloud platforms, practices, and partners to help the company optimize the customer and employee experience. And while it may seem counterintuitive, the technical aspects of migration may be less challenging than the human factors.
At NTT DATA, we have entire business units thinking about workforce and change management as well as customer experience, and this consulting talent is infused into our transformation programs. It’s been our experience that the maturity of the change management function can determine the pace of change overall.
In other words, steps such as ensuring alignment with senior leadership, instilling new behaviors in employees, and building consensus around cloud adoption is absolutely vital. Building a team with the right balance of technical skill and human understanding can make all the difference.
View the complete webinar with Forrester and NTT DATA here.
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Post Date: 6/13/2022