European Cloud Summit

How Cloud Transformation Projects Can Fail

by Eric Berg (CGI)

ecs blog

Wednesday, Aug 17 2022

A press release by our Diamond spononsor CGI Germany

By Eric Berg, Vice President Consulting Expert at CGI Germany

These days, everyone seems to wants to get into the cloud. But some companies take much longer to complete the transformation than others. Why is this? It’s true that there are various obstacles along the way. But the good news is that it’s actually quite easy to migrate to the cloud by taking a structured approach.

Most companies have put modernizing their infrastructure and application platforms at the very top of their IT agenda. This is because cloud platforms and services deliver considerable innovative power, efficiency, agility, and scalability, making them the best available option for transforming enterprises. But it isn’t enough to simply pick out a (hopefully) appropriate application. Companies need to define an appropriate cloud strategy first.

The keys to the success of a cloud-based transformation are good preparation and a sound strategy. Before doing anything else, companies need to ask themselves what goals they want to achieve with the cloud. Do they want to reduce their costs? Boost efficiency? Add new functionality? Which applications should be shifted to the cloud depends on the answer. They also have to decide which provisioning model is right for their strategy (private, public, hybrid, or multi-cloud) and which service model to choose, in other words IaaS, PaaS, or SaaS. Finally, before getting started it’s essential for them to analyze a business case by carrying out a detailed ROI calculation and come up with an exit strategy in case it turns out that migrating to the cloud wasn’t such a great idea after all.

The path into the cloud should therefore be carefully planned. That’s why quickly bookable services are tempting but not actually a good idea. When companies take advantage of convenient cloud provider portals to book supposedly quick & easy services, before they know it they can wind up with a completely opaque, user-unfriendly cloud environment. Unless they carefully analyze everything before taking the plunge, the application may turn out to be impossible to integrate into their existing IT landscape. It may also fail to comply with regulatory or data privacy requirements. Once companies have fallen into this trap, they can usually forget about reaping any cost savings.

Active change management is a must

In any case, migrating to the cloud isn’t exclusively an IT affair. It’s something that has to be actively supported by the entire enterprise and every single employee. Active change management is essential, or there’s a risk that the cloud project will fail spectacularly. Besides IT, other departments such as management controlling, purchasing, and human resources also need to be brought on board at an early stage so they’ll have time to prepare for the new work processes. Without appropriate training, staff definitely won’t welcome the new processes with open arms!

One common reason that transformation projects fail is that companies completely underestimate the potential of the cloud. A successful transformation involves more than just spinning out a server to a hyperscale infrastructure, in other words pure hosting. When an organization taps into the really juicy benefits of the cloud – like economies of scale and reduced time to market – it achieves major competitive advantages. But companies don’t actually start getting ready for the future until they begin leveraging new technologies and services like cloud-native application development, IoT, AI, and machine learning.

In the process, you should be careful not to use so many new tools that everyone gets lost in the woods. The best approach is to pick out a limited tool set. Here, less is usually more.

Quickly remove stumbling blocks

No new project can succeed without rules, and moving into the cloud is no exception. Companies therefore need to expand their governance strategy and define how they intend to implement cloud use to ensure compatibility with their overall strategy. Specifically, it’s about authorization management and defining roles, as well as regulating user access. Compliance with data privacy requirements (in the EU, the General Data Protection Regulation or GDPR) is an important aspect. Especially in the cloud, guideline-based identity management is a must.

To ensure the success of their cloud transformation projects, it’s smart for companies to sweep these stumbling blocks out of the way as early as possible. This is the only way for them to achieve their goals without holdups. And, worst-case, prevent the whole project from crashing and burning.

One last word: cloud transformations are quite demanding, and companies really shouldn’t try to master them all by themselves. To ensure a strategic, structured approach, it makes a lot of sense to get outside support. The service provider chosen should naturally have the required expertise.

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