Without a strategy, cloud migration can be complicated. We explain how to build a cloud migration framework founded on cloud financial operations, so you can ensure optimization from discovery to deployment.
Cloud migration is the process of transferring digital assets, particularly data, applications and IT infrastructure, to the cloud. Just as every organization has unique needs, cloud migration can take a myriad of forms, like moving digital assets from physical, on-site servers to a cloud platform; retaining some assets on local servers while moving others to the cloud; or moving digital assets from one cloud platform to another.
Modern companies must adapt to changing dynamics across technology growth and market shifts. Legacy applications, aging database architecture and complex integrations often restrict innovation and agility. Digital transformations excel when built on a repeatable and secure migration framework. You want to accelerate cloud adoption while modernizing applications, processes and services.
The Benefits of Cloud Migration
Storing data assets on the cloud enhances agility, accessibility and security. Cloud platforms allow organizations to adapt their digital assets to changing needs without considering challenging physical servers. Employees can access data and applications from wherever they are, improving their remote work experience and encouraging collaboration throughout the entire organization. Additionally, most cloud providers offer security services, so you can control who can access your data without implementing and managing security infrastructure.
The cloud can save your organization money by eliminating the need to pay for hardware. Many cloud platforms are pay-as-you-go, meaning you only pay for the services you use. However, what initially appears to be a perk of cloud migration — pay-as-you-go plans — can present a large risk to your organization.
The Risks of Cloud Migration
It is easy to treat cloud migration like a simple task: move all your digital assets to the cloud. However, how and where you move your assets has huge consequences for your organization. Without creating a cloud migration strategy, you risk not understanding the platform you purchase and overspending on services you don’t use — or you don’t even know you bought.
Broadening the scope of cloud migration from a task to an investment can reduce operational costs, introduce new tools and achieve tangible benefits for your business.
One way to achieve these benefits is by adopting a collaborative approach to cloud migration, which reduces costs and enhances transparency and accountability across different teams. This approach, known as cloud FinOps, can help your organization make informed decisions around cloud spending and prioritize your overall goals.
Building a Foundation for Cloud Migration: Cloud Financial Operations
Cloud financial operations (cloud FinOps) is a collaborative perspective that breaks down barriers between different teams, such as business, finance and IT, to increase transparency about cloud service spending throughout your organization. Cloud FinOps empowers teams to frame cloud-based decisions around speed, cost and quality and to prioritize your organization’s goals.
Now that we’ve discussed the collective benefits of cloud FinOps, let’s take a closer look at its four pillars.
The Four Pillars of Cloud FinOps
1. Identify current data asset expenses.
Determine the baseline cost of supporting your existing IT service management (ITSM) processes. Consider moving as much data from physical servers to the cloud as possible, so you can reduce unnecessary spending on hardware and invest in more agile cloud resources.
2. Create a cloud strategy.
Develop a detailed understanding of the total cost of ownership (TCO) to align your budget with cloud operational expenses. Organizations often face unanticipated costs because they underestimate the amount of data storage or other cloud resources they require. By preparing a budget and identifying your storage needs, you can select the right cloud platform and plan for your organization.
3. Use data to drive decision making.
Implement controls to measure the business value you derive from your cloud expenses. Define KPIs that align with your organization’s goals. Then, collect and monitor data relevant to cloud spending and its impact on business value, from efficiency to customer satisfaction. Finally, routinely review the collected data, use your established KPIs to assess performance, and look for opportunities to optimize costs.
4. Apply an application rationalization process.
Evaluate your applications to determine their value, relevance and alignment with business goals. Align your portfolio of software applications with the 6 Rs of cloud migration: re-host, re-platform, repurchase, refactor, retain and retire. While some applications function well as-is, others might perform better on a different platform, and still, others may no longer fit your organization’s goals.
Avoid This Big Mistake
Many organizations build their cloud migration strategy based on the infrastructure-as-a-service (IaaS) model, allowing businesses and individuals to rent infrastructure from a cloud provider rather than owning and managing it. The IaaS model focuses on “getting to the cloud” without efficiently “migrating to the cloud.” Many companies using the IaaS Lift-and-Shift model have realized this approach can get you to the cloud, but it does not modernize your organization. When you migrate without modernization, you are unable to use the full scale of cloud-native technologies that can truly transform the way you do business.
Without focusing on secondary and tertiary benefits of cloud adoption, like generating revenue and achieving organizational goals, you risk building a strategy focused on one stop of a long journey.
The Benefits of FinOps
Its foundation comprising of cost transparency and budget management, cloud FinOps prioritizes savings before making any cloud platform purchase. Cloud FinOps is a mindset that encourages all teams to communicate regularly and share responsibility for cloud usage. After using your teams’ reports to assess current costs and create an informed budget, your organization can select a platform and pivot to other cloud migration concerns, including checking security measures, learning how data comes in and goes out and training employees.
Conclusion
Building a robust cloud migration strategy can be time-consuming. Cloud FinOps aims to accelerate the process so you can benefit from the cloud’s capabilities without compromising quality and financial stability. By applying a FinOps framework to cloud migration, you can improve decision making and evaluate cloud investments that align with your organization’s future.
Learn about modern software delivery – what it is, why you need it and how it can help your business achieve quality software delivery.