Feasibility of cloud migration for large enterprises


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Analysis of conditions favouring movement to cloud for medium to large enterprises including checks for migration of existing application(s) from on-premise setup to cloud.

Published in: Business, Technology

Feasibility of cloud migration for large enterprises

  1. 1. Feasibility of Cloud Migration for Large Enterprises Cloud & Enterprise Security Group 17 Sujeet Nadkarni | Anant Damle
  2. 2. AGENDA Problems & Challenges Introduction Economics of Cloud Cloud Overview Alternatives System Sizing Techno- Financial Analysis Recommendations
  3. 3. Cloud solutions need to be objectively evaluated for the real business benefits for organisation as a whole and NOT in silos Introduction Cost Agility Adoption Technology Efficiency Architecture ComplexityDevices
  4. 4. Cloud computing is the use of computing resources (hardware and software) that are delivered as a service over a network Cloud Overview Source: wikipedia.org
  5. 5. Cloud offerings are classified based on services offered OR on the deployment/ownership of computational resources and architecture Cloud Overview Source: wikipedia.org Infrastructure as a service (IaaS) Platform as a service (PaaS) Software as a service (SaaS) Network as a service (NaaS) Storage as a service (STaaS) Security as a service (SECaaS) Desktop as a service (DaaS) Database as a service (DBaaS) Test environment as a service (TEaaS) Integrated development environment as a service (IDEaaS) Delivered ServicesDeployment / Ownership
  6. 6. Cloud combines Mainframe’s Efficiency and Client/Server’s Agility to provide an order of Magnitude better service through a new Business Model Cloud Overview Technology Economic Business Model Mainframes Centralised compute & storage. Thin Clients Optimised for Efficiency CAPEX Client/Server PCs and Servers for distributed compute & storage Optimised for Agility Perpetual Licenses for OS & Application Software Cloud Efficiency and Agility (order of magnitude) pay as you use Large DC Commodity Hardware Scalability
  7. 7. Cloud is multi-faceted, implementation requires clear understanding of drivers, inhibitors and usage patterns Cloud Overview Agility Cost BYOD Complexity Financial Mgmt. Drivers Privacy Technology Process Organisation Inhibitors Desktop Collaboration Business Process IT Efficiency R&D Web Presence Usage / Adoption SaaS PaaS IaaS Internal Web Grade Hybrid Cloud Type
  8. 8. Financial Decisions can NOT be based on just BUZZ Economics Agility pay-as- use Device and Location Independence Multitenancy Scalability Maintenance Low CAPEX API
  9. 9. The cloud derives its benefits from the scale of operations by aggregating supply side and the demand side of IT. This is through elastic consumption and provisioning for IT resources Economics Supply Side Savings Large DCs Lower TCO/Server Demand Side Aggregation Reduced Variability • Temporal • Multisource • Growth pattern Multi-tenancy Efficiency Increased number of tenants (e.g. customers or users etc.) reduced application maintenance / servercost per tenant
  10. 10. The cloud derives its benefits from the scale of operations by aggregating supply side and the demand side of IT. This is through elastic consumption and provisioning for IT resources SupplySide Power – Electricity/Cool ing Infrastructure Labour Security – Physical & Digital Reliability Cost Economies of Scale – Buying Power *Illustrative | Source: Economics of Cloud, Microsoft
  11. 11. The overall cost of IT is determined not just by the cost of capacity, but also by the degree to which the capacity is efficiently utilized Variability Multi-Resource Time of Day Random Uncertain Growth NOT considering Industry Variability as it concerns only Cloud Service Provider
  12. 12. Sluggish IT adoption in Non-IT organisations is caused primarily by weak process and employee IT-capability Personnel Organisational IT systems are dependent on external vendors, and internal IT capability is low Low competence to handle complex technology related tasks in-house. Process Complex Workflow - Heavily customised applications Different applications (pieces) are developed and maintained by separate vendors Process automation/Integration between departments is difficult Software Low Reconfigurability and Non-Modular system architecture. Applications are not designed for Multi-Tenancy Problems
  13. 13. Cloud is not panacea for IT. Organisation capability is an important factor for cloud migration Alternatives Criteria On Premises Third Party Hosted On- Cloud (PaaS/IaaS) Technical Moderate High Performance High Moderate High Security Moderate Low High System Access High Low Low to Moderate System Availability Moderate High Total Cost (100 Servers – 7 yrs.) Moderate High Maintenance Skills Moderate Low to Moderate High Cost/Unit High Low Software Development Efforts Low High Cost Low High
  14. 14. System sizing establishes a benchmark performance and price for comparison within alternatives Sizing
  15. 15. CRM is a candidate application as it presents significant savings from Cloud Migration Analysis Organisation Size ≈1000 No. of Licenses 200 Growth Rate 20% p.a. WACC 10% p.a. Network Growth 40% p.a. Salaries Head Growth 15% p.a. TAX Rate 40% Number of CRM Records ≈ 10,000,000 (10 million) Assumptions Based on sample calculations as per assumptions and published price list for Oracle Seibel CRM (on-premise) and Salesforce.com 9.2 4.9 USD
  16. 16. Custom developed application is in grey area in terms of savings from Cloud Migration Analysis Assumptions Based on sample calculations as per assumptions and published price list for typical workflow application on premise and Google App Engine # Unit Storage 7824 GB Total Record Access 500 Per User /week Size of Record 100 KiB Server CPU – 2 RAM – 3 GB HDD – 420 GB 32 Piece 4.4 3.0 USD
  17. 17. Cloud migration presents significant cost savings, but migration feasibility depends on specific risk profile of the organisation Recommend Significant Cost Savings Vendor Lock-in Private Cloud CAPEX Legal & Regulatory
  18. 18. THANK YOU