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CIOs turn to cloud as tech budgets come under scrutiny

As market volatility increases and economic headwinds gather, CIOs are looking to lease cloud-based IT infrastructure and software on a subscription-based model, rather than making large technology investments for one-time investments.

A recent Gartner report found that cloud consulting and implementation and cloud hosting services are expected to reach $255 billion this year, with spending on data center systems expected to be the largest of any market segment in 2022 strong growth.

Cloud investments give CIOs the opportunity to reallocate budgets traditionally dedicated to data center infrastructure (hardware, physical space, power and cooling) and resources to support servers (continuous maintenance and upgrades).

Reallocating resources means CIOs can focus on other initiatives that support strategic business goals: for example, digital workplace solutions designed to improve employee and customer experiences.

“There has been a clear shift in the way organizations do business, and they will continue to rely heavily on cloud computing,” said Paul Deur, co-founder and CEO of ReadyWorks. “At the same time, cloud investments are not necessarily suitable for all businesses right now.”

CIOs must audit, develop organizational overview

To determine whether an organization should invest further in the cloud, it is important to have a comprehensive understanding of the business, the applications that are most used, and why and how those applications are being used.

“In some cases the employee returning to the office may completely change what that photo looks like, in others not, so you need to plan accordingly,” Deur explained.

This is an example of how having a tool like Digital Platform Command (DPC) is critical to a CIO’s decision-making.

DPC reduces the cost and risk of cloud migration and connects to all IT and business systems to collect and analyze information, identify missing or incorrect information, and automatically collect additional information from users and Stakeholders. It analyzes the migration readiness of systems, applications, and users, then orchestrates and reports on all workflows related to cloud migration.

For many businesses, moving to the cloud promises savings in hardware, power and maintenance, but now costs are rising as digital transformation initiatives accelerate and more workloads are virtualized, Deur said rise.

For a hybrid environment of on-premises and cloud facilities, costs will initially increase,” he explained. “However, as the journey progresses and on-premises costs decrease over time, teams need to Realize that cloud costs can become bloated if left unchecked. “

Keep an eye on cloud costs

While cloud technology investment is booming development, but CIOs should also keep a close eye on cloud cost management, which can quickly spiral out of control.

To ensure cloud costs are properly controlled, it is important for CIOs to have an organization that enables them to Tools to closely monitor and act on unused resources – if these idle resources continue to be used, there is no cost-effective cloud balance sheet.

JupiterOne CISO Sounil Yu said engineering teams should Shut down resources as soon as they become idle, and rebuild them through automation when needed again.

“CIOs should implement this routine because, in addition to reducing costs, it increases the organization’s risk of unexpected failures. Overall resiliency because it forces engineers to practice rebuilding on a regular basis,” he said.

Dennis Monner, chief commercial officer at Aryaka, agrees that cloud investment is on the rise, noting that there are two parts to it.

“First and foremost, CIOs need to understand their true cloud cost and not bring it back in-house, which also comes with risk and expense,” he said. “This needs to be a real apples-to-apples comparison. . “

Second, he said that there are several companies that specialize in cloud cost control, and utilizing their services can be beneficial to ensure that costs do not fall. t get out of control.

“Advance Plan not to introduce solutions that could lead to dead ends,” he advises. “If possible, focus not only on cloud providers (CSPs), but also on integrating cloud-based networking and security for a more complete and efficient conditions required for the solution. “

CIOs must invest in tactics

in In Yu’s opinion, public cloud is only cost-effective if it is used correctly in the context of service uncertainty.

“If you are sure what resources you need all the time, cloud computing is not cost-effective ,” he said. “It’s like buying and renting a house. If you know you’re going to be working and living in a particular place for at least five years, and you know exactly how much space you’ll need, then you’re better off buying a home. “

That means renting may be a better option in times of economic and lifestyle uncertainty.

“That’s why new builds are perfect for cloud computing ,” he explained. “Because these moves are full of uncertainty, you want to minimize sunk costs so you can make adjustments as quickly and as often as needed.

Monner added that cloud is almost a better investment now, and SaaS-type fees are easier to budget when money becomes harder to come by.

“Furthermore, the overall benefits of cloud continue to shine — flexible capacity, no stranded investments, less internal hardware/software purchases, training and upgrades, isolation of supply chain issues, multiple geographies, and more,” he said.

Readworks’ Deur noted that any cloud transformation initiative requires a strategic plan that begins with an audit of the environment to understand which workloads and applications can and should be migrated, and what the organization can ultimately support.

‘ In that case, the budget will be consumed very quickly,” he warned. “If you don’t pay attention to your cloud usage, or your spending, you may end up paying more than you need to.”

Read next:

SPECIAL REPORT: How fragile is the cloud?

You get what you pay for: Cloud Edition

How to maximize your organization’s cloud budget



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