Look at Cloud Holistically and Calculate the Total Cost of Ownership

Ankur Rastogi Head - IT Application Management and Cloud Migration at Lufthansa Group

Datatechvibe caught up with Ankur Rastogi, Head – IT Application Management and Cloud Migration at Lufthansa Group, who will be speaking at Enterprise Cloud & Data Center Forum to get his view on cloud adoption and what companies should pay attention to.

On-demand, scalable cloud models offer cost-efficiency, yet many organisations seem to be underfunding Cloud, why is that? 

Digital transformation should not be done for the sake of it.  Only those projects that generate value make sense. Cost efficiency has always been an important KPI, but now with the current COVID crisis, the need to optimise costs is even more critical. At the same time, it is also essential to do it correctly. In organisations, cloud is sometimes seen as an infrastructure strategy. When we talk of costs, we compare unit costs (for instance, the price per server or price per storage unit) between the traditional data centres vis a vis cloud. This, of course, leads to a perception that the cloud is expensive, resulting in projects not being approved.

I believe it is essential to look at cloud holistically and calculate the total cost of ownership. The overall business case must include price, performance, security and non-functional requirements. It is essential to map the business benefits that come with cloud-like agility, flexibility, scalability and business continuity.

To achieve that, a mindset change is required. If you try to start the cloud journey based on legacy data centre expectations, traditional processes and old working style, cloud transformation will not succeed. We cannot force-fit legacy into cloud.

Are cloud wastage and operational inefficiencies hindering cloud adoption?

There is no doubt that cloud adoption is expanding at a rapid pace. However, like any technology or platform, if it is not used correctly, waste happens. Let me first try to explain what I mean by this term. Cloud wastage includes:

Resources provisioned but not consumed: As we know, cloud works on the “pay per use” principle. However, there is a tendency to still set-up non-productive environments like test, deployment and keep them running 24×7.

Overprovisioning: meaning provisioning more than you need. For instance, more extensive storage, larger size Virtual Machines, underutilising of the provided services. The easiest example is setting up large containers and not using them to their most optimal capacity. This, of course, results in operational inefficiencies and high initial costs, thus impacting cloud adoption.

People are still learning about cloud, specifically the art of cloud optimisation. It is also a fact that the cloud world is very dynamic, with new products coming out every week. , It is essential to incorporate cloud optimisation as part of the regular work package structures. Some of the tasks that can be included in this work package are:

  • Generating transparency in consumption and actual demand. All large cloud providers offer various tools for monitoring and managing resources. You can also set up thresholds, which works similar to the concept of electric circuit breakers.
  • Constantly look at the consumption values and re-adjust the compute resources, sometimes even going back to the drawing board and provisioning the environment again.
  • Look at the cloud from a portfolio perspective and not from an individual application-wise view; Shared resources, specifically containers, shared databases, shared tools, can help a lot.
  • Try to avoid migrations on a re-host basis (lift & shift). Sometimes to speed up the migration, we are too tempted to use this migration approach. Still, the real benefit comes when you re-architect or re-design your applications to utilize native cloud features and leverage auto-scaling functionalities. A good solution sketch will also help determine the optimal infrastructure setup, appropriate deployment model and suitable cloud feature set.

WFH accelerated the migration from geographically concentrated IT services to cloud-based solutions. What challenges will we see in 2021?

WFH model due to the current pandemic definitely helped change the mindset about remotely accessing resources and working from anywhere. I like the term No-shore model. This led to an exponential increase in cloud adoption, with every organisation racing to cloud. As some of these decisions were driven by the necessity to cope with CoVID disruptions, the models adopted can be a bit ad-hoc and not well-thought-out. This generates complexities.

As I said earlier, it is essential to use the cloud the right way to leverage its power truly. I believe organisations post- CoViD in 2021 will look to stabilise the journey and make it more structured. This means the challenges that we need to address are: making the cloud journey more effective, application modernisation, solving the integration aspects associated with hybrid and multi-cloud models and streamlining concepts related to DevOps and SIAM. Also, optimising the cloud and the related governance mechanisms would be a key priority.

Also Read: Why IT Leaders Believe that Migrating to the Public Cloud is Essential?

How will the speed and connectivity that 5G offers impact cloud adoption?

The fifth generation of cellular network technology offers a significant boost in network speed and significantly reduce latency. The obvious benefits are in the space of collaboration and communication. 5G should positively impact data access & analytics, artificial intelligence, streaming, IoT, machine learning, and virtual reality. It will also enhance the reach of cloud services, both geographically and functionally. Meaning more and more people around the globe can benefit from the cloud. Also, more business solutions can be developed using the cloud. Providers will constantly evolve their offerings to benefit from faster speeds.

As mentioned earlier, the current crisis increased the tendency to work remotely. This directly impacted the increased adoption of cloud-based solutions, video conferencing, and collaboration tools. 5G will make the whole experience smoother and faster.

Is edge the new cloud? Will companies shift their cloud strategies toward the edge to become more connected?

Somehow, through this question, we assume that it’s either edge or cloud, and only one can survive in this competition. In my personal opinion, the two technologies do not compete; instead, they are complementary. The business use cases in the global environment need both and require them to work together. Edge computing focuses on speed & proximity. Cloud computing focuses on scalability and global reach. Cloud is no longer just about compute power and storage capacity. It has now established as a solid platform providing business-oriented solutions. As more and more organisations start leveraging IoT, predictive analytics & augmented reality, the need to synergise edge and cloud and generate a joint business proposition will grow.

A shift to the cloud expands the digital perimeter and increases risks. How can organisations be better prepared? 

Cloud is an essential cornerstone behind digital transformation. Digital transformation requires agility & flexibility, which are precisely the two benefits that cloud vouches for. Simultaneously, cloud is a new platform within an organisation that results in certain risks revolving around operations, compliance, security and data. Some of them are real, and some perceived as people still have not fully understood how cloud works. I believe these risks can be managed. A clear strategy, the proper organisational structure, good governance, and effective communication are required to make the “Journey to Cloud” smooth and successful. When you are embarking on this journey, it is critical to focus on skill buildup and change management.

What key insights will you be sharing in your session at ECDC

The topic of my session is: Cloud Migration: The need for a successful strategy for an increased ROI

Most organisations around the globe are already in some stage towards cloud transformation. The question is not “if” but “when will they adopt” and “how can they embark on this journey”. It is no longer required to convince the stakeholders of the benefits of the cloud. Nevertheless, like all great things, if not managed correctly, the desired benefits cannot be achieved, resulting in disappointment. The key to a successful cloud adoption starts with the question “Why”.

Why do you want to migrate to the cloud? What do you want to achieve with the cloud? How is cloud different from a modern data centre? The answer to these questions should lay down the foundation of your cloud strategy. In the end, cloud and business strategy need to be interlinked and complement each other. Only then you would achieve a higher probability of success in your journey to the cloud.