Posted in: cloud computing, Latest News & Views
Cloud computing is all the rage right now, and investing in cloud services can boost companies’ bottom lines. But for those investments to pay off, organizations must strategically plan what they should and shouldn’t move to the cloud.
Planning a cloud computing strategy isn’t just IT’s job. As companies have moved more applications to the cloud, management in other areas is getting a greater say in the company’s decisions. In fact, 37% of IT pros said that non-IT managers are among the most influential decision makers when it comes to the company’s cloud computing strategy, according to a recent CDW survey.
For Finance, the role will most often be helping determine whether investing in cloud computing will pay off for the company. And a big part of that will be determining what the company should — and shouldn’t — move to the cloud. Some applications and services are well-suited for the cloud, while others may end up costing the company a lot if they’re moved away from the in-house infrastructure.
The cost of cloud computing
One important consideration, of course, is whether or not a cloud computing service will save the company money. That’s not as simple as comparing subscription fees with the cost of software licenses — there are many factors that affect how much both cloud services and in-house systems cost.
When it comes to cost, these were the top factors the 1,242 IT pros said their companies considered when deciding what to move to the cloud:
- Software management costs (cited by 65% of IT pros)
- Software licensing costs (63%)
- IT labor costs (52%)
- Cost of capital to the organization (41%)
- The cost of powering in-house operations (21%), and
- Real estate costs (12%).
However, the survey shows that most businesses fail to gather all of that information before making a decision. Just 37% of the survey respondents said they had all the data about costs that they needed.
What to keep out of the cloud
Aside from costs, there are a few other reasons an application or service may be better run on the company’s own network. When asked about their biggest concerns with cloud computing:
- 46% of IT pros said they were worried about security of data held in the cloud
- 32% were concerned about the performance of applications in the cloud
- 25% were worried about integrating cloud apps with legacy systems, and
- 20% had concerns about software licensing.
Due to those concerns, many experts recommend companies think twice about using cloud computing for running mission-critical applications or storing sensitive data, or for applications that need to interact with older in-house systems.
Here are some items organizations might twice about before moving to the cloud:
- Stable, legacy applications — Apps that have been around for a while, are stable and predictable, and don’t require a lot of updating typically won’t use many resources when kept in house compared to newer, unfamiliar apps. Therefore, they often offer less benefit when they’re moved to the Cloud.
- Highly integrated applications — Some software relies too much on other in-house applications so moving it to the Cloud could cause a lot of complications. That might include ERP systems or finance applications — if they’re already set up to run in-house, companies may want to keep them that way.
- Data with regulatory requirements — While security is a concern, some companies have decided to put some sensitive and critical data in the hands of properly vetted cloud computing providers. However, organizations should be careful about any data with regulatory requirements regarding how it’s stored and protected. In many cases, the company is better off keeping that information on the office network.
- Bandwidth-intensive activities — Cloud computing requires data to be sent back and forth using an Internet connection — therefore, companies are often better off keeping applications that require a lot data to be moved or have I/O needs in house.
- Highly customized applications — Cloud computing providers sometimes allow for certain degrees of customization. But often if something needs a lot of tweaking to meet very specific specifications, it’s better kept in house.
What to migrate?
What applications belong in the cloud? These were the top cloud computing services respondents to CDW’s survey have adopted or are planning to adopt:
- Conferencing and collaboration (cited by 68% of IT pros)
- Storage (65%)
- Office and productivity suites (65%)
- Messaging (62%)
- Compute power (59%)
- Business process applications (57%)
- External hosting for internally developed applications (55%), and
- IT governance applications (51%).
Those choices also depend a lot on what industry the company’s in. For example, when respondents were divided by industry, storage was a top choice for cloud migration in every industry except for government and health care.
The most likely explanation is that those groups need to store more sensitive data than other organizations, and therefore aren’t comfortable using cloud-based storage services. Healthcare organizations and governments were likely to have moved to cloud computing for conferencing and collaboration software, office and productivity suites, and messaging applications.
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