Cloud adoption is a crucial business strategy to achieve success and unlock value in today’s digital landscape. As per a recent survey, 95 percent of European companies claim to capture value from the cloud. However, what really needs to be considered is whether the value realized is merely from improvements to IT and resultant cost savings, or whether it is based on higher-value cloud use cases that leverage new age technologies.
The research also indicates that companies that have effectively integrated gen AI (generative AI) in their transformations, could achieve up to seven times the ROI (Return on Investment) of their peers for each migrated business domain. Therefore, successful cloud adoption must extend beyond technology and should involve accomplishing specific business objectives.
Vice President of Cloud, Infrastructure and Security Services at Infosys.
Metrics for a robust cloud strategy
A well-planned cloud strategy is one that emphasizes elements like strategic management, cost optimization, business agility, resilience, business domain adoption and foundational capabilities.
Strategic management involves aligning cloud adoption with business goals and establishing governance frameworks, where technical decisions are directly tied to business outcomes. The next metric of cost optimization is realized by shifting from capital to operational expenses, ensuring scalable resource allocation, and faster solution delivery. It involves monitoring metrics like cost per usage to maximize returns on cloud investments.
This ideally leads to decreased IT expenses and frees up resources for strategic endeavors. The third metric of business agility assesses the organization’s adaptability to dynamic market changes. Cloud services can play a pivotal role in accelerating time-to-market for new product showcases, thereby fostering innovation. Performance and scalability of cloud infrastructures can be evaluated through application uptime and the ability to scale on demand, towards seamless operations and enhanced customer experiences.
The next component of a comprehensive cloud strategy is resilience, which essentially refers to the ability of the cloud infrastructure to bounce back from setbacks seamlessly. In the new era of cloud resiliency, security is prioritized from the outset, through continuous operations and formidable security measures against cyber threats. This includes implementing robust access controls, data encryption, threat detection measures and tracking security incidents through audits to uphold data security and compliance.
Building resilience also involves modernizing IT infrastructure, automating infrastructure management, and implementing modern networking solutions. Technologies that enable flexible workloads and optimize resource utilization can significantly enhance operational efficiency. Automation and infrastructure modernization further streamlines operations and unlocks new possibilities for innovation and growth.
Business domain adoption, another element of an effective cloud strategy, focuses on integrating cloud technologies to drive innovation and enhance customer experiences. Cloud adoption drives revenue growth through new offerings, elevates customer satisfaction via quicker interactions, and empowers the workforce with superior collaboration tools. Lastly, focus must be laid on building foundational capabilities by developing technical skills, adopting agile methodologies, and modernizing IT infrastructure to support seamless integration with cloud services.
Skill building also needs to be considered for successful cloud adoption. Skills such as automating infrastructure configurations and managing APIs can be developed as the cloud environment matures. DevOps principles and automated deployments can nurture collaboration, facilitated by continuous integration and delivery pipelines. By prioritizing these metrics, organizations can gain a strategic edge and foster long-term success.
Challenges to realizing cloud value
Transitioning to a cloud-based operation involves a dual-pronged strategy. While cost optimization, requires right-sizing resources, leveraging discounted instances, and implementing auto-scaling based on demand, accurately forecasting demand and navigating complex cloud pricing structures can be difficult. Likewise, while scalability is enabled by containerization, serverless computing, and infrastructure automation, managing complex applications, ensuring security during scaling, and avoiding vendor lock-in present additional challenges. Therefore, organizations must continuously monitor and adapt their strategies while addressing these challenges.
Developing a cloud governance framework
An effective cloud strategy aligns business goals through a strong governance framework that prioritizes security, compliance, and cost optimization, while being flexible to accommodate growth. Piloting non-critical applications can help refine this strategy before larger migrations. Cloud optimization is an iterative journey, requiring ongoing refinement to sustain benefits.
Companies must first assess their maturity model to identify areas for improvement. This includes optimizing their cloud mix by exploring different cloud providers or cost structures, providing regular policy updates for compliance, cultivating a continuous improvement culture, proactively addressing challenges, and having active leadership involvement in the cloud vision for stakeholder buy-in.
Today, cloud technology has transformed the way businesses provide customer services, offering them a personalized, scalable, real-time interaction experience. Companies can offer their customers seamless experiences across multiple channels, ensuring the same level of service whether their customers interact online, through mobile apps, or in-store. Cloud-based data analytics helps businesses gain valuable insights into customer behavior and preferences, allowing them to provide proactive support, and fostering long-term loyalty.
Conclusion
The merits of cloud computing are well established and European companies have shifted focus on deriving business value such as increased operational efficiency, faster time-to-market for products and services, enhanced customer satisfaction, and improved bottom-line results. By aligning their business goals and cloud strategies, these companies will realize tangible results to unlock even more business value in future.
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