Are you under-pressure to be more transparent about how your cloud strategy is delivering value to the business?
Or perhaps you’ve acquired new businesses and want to avoid duplication of costs. You see the opportunity to go to the cloud rather than rely on legacy infrastructure and services.
When your business moves to the cloud either through a central services organization or individual business units going it alone, providing visibility and management across multiple clouds can become all-consuming for business and IT teams.
The capabilities and features offered by the latest applications, tools and cloud platforms can address a wide range of business challenges. Relatively low or near non-existent upfront costs means your teams can implement these solutions on their own. Unfortunately, that also means it’s increasingly difficult for management to establish unified, company-wide solutions, and sometimes impossible to account and budget for IT spending.
Self-managed cloud solutions are especially susceptible to runaway costs, due to misunderstanding workload usage, poor cloud architecture or poorly performing applications.
Hybrid cloud environment key to cost optimization
A managed hybrid cloud environment is a key way to enable economic optimization, but that requires a realistic assessment of the cost and ROI of different platform choices, and an understanding of what drives those economics.
For Wyndham Hotels & Resorts, the world’s largest and most diverse hotel franchise company, spinning off from its parent company in 2018 offered the opportunity to reassess its strategy for handling technical debt. Because it built its portfolio of hotel chains through acquisitions, that also meant taking ownership of those chains’ often aging legacy data centers.
“We realized we could either lift and shift,” said Wyndham EVP and CIO Scott Strickland. “Or use the opportunity to transform.”
Wyndham first identified several “anchor applications” that could be moved to a cloud-based SaaS model, but after a thorough assessment, determined that it wouldn’t be able to immediately move all its workloads to the cloud. Instead it chose a colocation strategy — moving its existing hardware to a third-party data center — as a launch point toward a longer-term IT evolution.
That migration offered an immediate return on investment: “Our first year of savings are in the 40 to 45 percent range from our traditional run cost,” said Strickland, along with “about a 30 to 40 percent performance improvement.”
Critically, Strickland has been able to plow some of that ongoing savings back into the company’s ongoing transformation and innovation efforts.
Enterprises such as Wyndham found that by controlling IT spend, it has been possible to:
- Accelerate delivery of new products and services – a must for any leading business to remain competitive, lead and delight customers. An agile, multi-cloud infrastructure and set of tool chains the delivers the strategic flexibility, optimum economics and easier migration to the cloud speeds new application development. By getting IT spending under control and optimized, you can focus on delivering new applications, products and services.
- Increase business agility– the ability to rapid change or adjust to evolving to radically changing business circumstances. The speed of business is accelerating along with customer demands. Moving and implementing as much of your IT estate as possible on the right clouds and tool chains with an eye to economic optimization enables this increased business agility.
- Optimize economics – optimizing economics is key to maximizing the use of your resources on your transformation. Specifically, getting the most cost-effective options for IaaS and SaaS which do not differentiate your business so you can deploy as much of your people and other resources to high value business transformation projects.
Path to optimize spend
In addition to these business benefits of a hybrid cloud environment, it’s also possible to reduce or eliminate capital and operational expenses, while also taking advantage of the latest technologies by transitioning workloads to a full stack professional and managed services provider. This also enables companies to redirect IT budgets and resources to projects that directly benefit and differentiate their businesses.
Full stack professional and managed services providers can help with the discovery and assessment of existing infrastructure, help understand total IT spend, and develop and execute strategies to lower TCO, lower risk and increase ROI. Ideally, by using a process-first assessment, hybrid cloud solutions can be designed to maximize cost efficiency by utilizing the best mix of managed public cloud and private cloud.
Then decisions can be made on an application-by-application basis, to ensure each is mapped to the best-suited platform in terms of economics, performance, workload variability and data sovereignty and compliance. The goal is to deliver the right app to the right cloud, accessing the right data, with the right control and governance model, at the right price.
For Wyndham’s Strickland, having the right comprehensive team in place not only allowed the company to migrate quickly and efficiently, leading to higher performance and big savings, it also “freed up my team to work on many more strategic initiatives for the organization.”
Is your organization seeking to optimize spend? Consider Rackspace: