Getting IT wrong is stressful. Cost savings are leading CFOs to consider moving to the public cloud, but the real value of cloud comes from the business agility it enables.
“If you look at the cost per storage, or the cost per [million instructions per second] or CPU cycle, there’s a price war going on between Microsoft, Google, and Amazon Web Services,” Mark Peacock, IT transformation leader at the Hackett Group, says here. He notes that some private cloud clients have compared costs and as a result are moving some applications to the public cloud.
This recent post on cfo.com highlights the race to the bottom of infrastructure costs as a key driver for cloud Infrastructure as a Service (IaaS). Should this be the primary driver for adopting public cloud? Our experience enabling cloud adoption by both large enterprise and nimble software companies has shown that rapid time to value and the ability to continuously right-size infrastructure investments delivers even greater value than the costs savings.
#1 Rapid time to value
Software projects move twice as fast when Development, QA, Build and Run teams are all using cloud and collaborating. This is realized by providing the innovators with the resources they need, when they need them, without having to introduce the friction of making services desk requests or the delays caused by logistics of capacity planning and an outdated supply chain.
How much value is there in reducing the time and effort between when coding starts to when code is running in production? The business value of having the project delivered faster depends on the project. Delaying the value due to an outdated supply chain is a stress that cloud can eliminate.
#2 Right amount
Public clouds can cost less, but proving it with the math for private cloud costs is not obvious. When calculating the costs of private clouds, it is hard to reflect the cost of having the wrong amount of infrastructure. You are guaranteed to have the wrong amount! Too little and projects grind to a halt or worse. Too much is a waste. Using the public cloud, you can continuously right-size your infrastructure. If you have the scale to build a positive ROI around a private cloud, then combine it with a public cloud to eliminate the risk of not having enough at the right time.
#3 Right location
The speed of light and differing legal requirements in different jurisdictions will require you choose the right locations in the world. Several recent customers wanted to keep their primary site in cloud.ca, our Canadian owned and operated cloud, and still use Amazon's cloud to give them a global presence. Using cloud in Canada keeps their data under Canadian legal jurisdiction and using Amazon helps them overcome the speed of light issues. Privacy and data sovereignty regulations (current and future) can have an impact on the right locations. The speed of light is often negligible but latency sensitive or global applications may require multiple locations. The right location changes with usage cycles or business directives.
Click here to see a demo video of real-time cost reporting by project in cloud.ca.
CloudOps helps companies get business value out of cloud infrastructure in Canada and around the world.