“Why should we move our IT infrastructure to a cloud based model, when we can purchase on-premise physical hardware and not have to worry about it again for the lifecycle of the equipment?” – a question our consultants in the Professional Services Team are often asked by Clients.
In our minds, the answer is “Why wouldn’t you?”.
Traditionally, IT infrastructure hardware (physical servers, networking equipment, etc.) has been considered to be a necessary burden that is accounted for as a CapEx purchase made only when absolutely necessary, i.e. when the assets have been “sweated” for the highest return on the investment possible, or when they have ceased functioning as required (or even at all).
When taking total cost of ownership into account, factoring in “hidden” costs directly attributable to on-prem environments (examples of such being power, cooling, hardware warranties, downtime for patching and routine maintenance, etc.), a very different picture emerges regarding the size of the investment.
Physical infrastructure also increases a reliance on a geographical location, reducing mobility and impacting resilience and reliability at a time when patterns of work are evolving to allow users to work anywhere, anytime, on anything. A key variable in improving work/life balance, and increasing productivity and job satisfaction.
The migration to a Cloud based infrastructure, charged on a rolling/usage basis, is a big step to take in the short term, but a highly rewarding one if implemented correctly. Whilst some may see the increase in monthly overheads as undesirable, when considering the TCO considerations mentioned above the impact is significantly lessened. Indeed, a key point that is often overlooked in comparisons between Cloud Vs On-prem is capacity planning. When designing a physical infrastructure refresh, the highest expected load over the entire lifecycle (possible up to five years) must be accommodated. Therefore, every second a piece of physical infrastructure is running at less than peak utilisation, it is incurring additional cost to the business rather than adding value to it. Predicting capacity requirements with any degree of accuracy over a timescale of 3-5 years is a challenge in itself.
Consider the alternative… planning for the lowest usage, and scaling up as and when required, and back down when demand has reduced. Only paying for what you actually use, rather than what you could potentially use. In businesses that require development and test environments, not having expensive equipment lying dormant and depreciating when not in use, and simply creating entire development architectures when required (and shutting it all down when no longer needed). The ability to be truly agile as a business, with happier, more productive, staff that are no longer constrained by geography. Enjoying the peace of mind inherent in knowing that your critical business systems and data are protected by the highest levels of resilience, redundancy and security, rather than in a room (or even cupboard) in the same building as your users.
The benefits of a business strategy based on the ‘Digital Transformation’ mindset cannot be overestimated, and provide a paradigm shift in Clients business processes and goals.
Viewing IT as an operational expense (that acts as a business enabler), rather than a capital expense (that increases drag and reduces agility), results in the question posed at the beginning of this post rapidly transforming from “Why should we…” to “When can we…”.
Written by Scott Relf With a background in Operations Management, Scott has applied his expertise to our Services and Service Desk functions since joining in 2014. He now leads our Project Consultants as they provide specialist implementation services.