While Cloud is fast becoming the new normal for organisations of all sizes, many IT executives & budget owners struggle to articulate the business value of moving to the Cloud in terms that resonate with the Board and broader C suite. In this session, we will talk through the impact cloud computing is having on the overall IT cost base, not just the infrastructure layer. We will also cover what the typical non-cost benefits are, and how they can be measured and communicated. Finally we will provide a framework that can be used to calculate the transformation costs associated with moving to Cloud. Speaker: Conor McNamara, Head of Cloud Economics and Enterprise Strategy, Asia Pacific, Amazon Web Services

1. © 2016, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
Conor McNamara, Head of Business Development, APAC
Amazon Web Services
Ben Cabanas – CTO, Transportation, GE
Demystifying Cloud Economics
How to Build an Investment Case for Scale Migration to the Cloud
Business

2. Patterns for Enterprise Adoption
“transform the way organisations produce &
consume technology”
Remediate
Technology Debt
Develop an Innovation
Factory
Platform

3. But how do I quantify this?

5. The migration approach is dependent on the specific
drivers and constraints of the organisation
Lift and Shift Right-­sized on AWS AWS-­Optimized
Old world
enterprise in
the cloud
Exploring
the new
normal
Next-­gen
operating
model
Benefits
of
change
Degree of Change

6. Why the economics of cloud
are different

7. What are the key benefits categories?
• Unit Price of Infrastructure
• Ability to match supply & demand
• Reinvention is continuous – a true efficiency dividend
• A pathway to optionality
• An elastic Cost Base
• Transparency drives a lean mindset
Operational Costs

8. What are the key benefits categories?
Workforce Productivity
• Automation drives maintenance efficiencies
• Reduced cost of planned and unplanned outages
• Increased Developer Productivity

9. What are the key benefits categories?
Cost Avoidance
• Elimination of hardware refresh programs
• Elimination of maintenance programs

10. What are the key benefits categories?
Operational Resilience • Reduced Risk Profile/Reduced cost of Risk
Mitigation
• Revenue & margin improvements due to
reduced outages

11. What are the key benefits categories?
Business Agility
• Reduced Time to Market
• Increased operational agility (new market
penetration, divestiture, acquisition)
• Reduced cost & increased Pace of
Experimentation

12. What are the key benefits categories?
Operational Costs
Workforce Productivity
Cost Avoidance
Operational Resilience
Business Agility

13. AWS TCO support to date

14. AWS TCO Calculator (https://awstcocalculator.com)

15. What’s missing?

16. Economic Criteria Category
Infrastructure Comparison
Capacity Planning benefits
Financial Benefits of Innovation
Cost Avoidance
Workforce Productivity
Application centric TCO
Cost to Achieve (Migration, Platform, Training)
Legacy Constraints

17. Why do a Mass Migration?

18. If I were you,
I wouldn’t start from here…

19. Ø Utility pricing model across entire technology stack
Ø Reduced maintenance costs & ability to refocus your staff
Ø Access to innovation platform
Ø Provide direct cost control to the lines of business
Ø Remove the depreciation “hole” & eliminate capital commitments
Ø Use it as a platform for future cost savings
Ø Eliminate hosting technology debt.
Ok, on a serious note…

20. Am I ready for a mass migration?

21. The Adoption Journey & the role of Mass Migration
Year 1 Year 2 Year 3 Year 4
• Early Discovery
• Learning
• POCs
• TCO/ROI Analysis
• Security & Risk Preparation
• Cloud Strategy
• Foundational Architecture
• New Application
Patterns (MSA, CI/CD)
• Dev/Test
• Production
Application Migration
• Operational Integration
• Billing Optimization
Value
• Portfolio Mass
Migration
• DC Shutdown
• Horizontal Solutions
(VDI, Back-­
up/Archive, Broad
storage)
• Advanced
Operational Patterns
(CI/CD)
• Optimization
• Infrastructure fully automated
• App/Dev owns full solution stack with
tools and service catalogs
Time
Year 5

22. The Adoption Journey & the role of Mass Migration
Year 1 Year 2 Year 3 Year 4
• Early Discovery
• Learning
• POCs
• TCO/ROI Analysis
• Security & Risk Preparation
• Cloud Strategy
• Foundational Architecture
• New Application
Patterns (MSA, CI/CD)
• Dev/Test
• Production
Application Migration
• Operational Integration
• Billing Optimization
Value
• Portfolio Mass
Migration
• DC Shutdown
• Horizontal Solutions
(VDI, Back-­
up/Archive, Broad
storage)
• Advanced
Operational Patterns
(CI/CD)
• Optimization
• Infrastructure fully automated
• App/Dev owns full solution stack with
tools and service catalogs
Time
Year 5

23. Challenges of a mass migration
investment case

24. Ø Lack of sufficient data re. legacy estate to plan or build a business case
Ø Sunk costs associated with legacy contracts and/or existing DCs/Co-­Los inhibit
short term saving potential
Ø Uncertainty as to level of investment required to migrate and build future state
platform
Ø Lack of clarity as to future state benefits profile (cost savings++)
Ø Short term cost spike due to running old and new world in parallel
Ø Cash constraints and shareholder pressure often means there are capital
constraints

25. Good News -­ we can help!

26. • Data Discovery Support (Tooling + Competency)
• Full Benefits Assessment via AWS Value Engineering
• Migration Methodology + Transformation Cost Estimates
• Tailored AWS & Partner Investment Programs

27. Cost to Achieve – Application Transformation Patterns
Migration Pattern Name & Label Pattern Description
Retain Ø Clientwill keep host / application in their source environment
Retire* Ø Application and host decommission on source
Re-­Hosting*
Ø Like for Like application migration to target cloud
Ø Minimal effort to make the application work on the target cloud infrastructure
(Minimal appl layout change)
Re-­Platform*
Ø Up-­Version of the OS and/or Database onto the target cloud
Ø Storage migration will be needed (without conversion)
Ø Application reinstallation on the target
Ø Database to AWS RDS
Re-­Factoring*
Ø OS and/or Database porting
Ø Middleware and application change to cloudify an application
Ø Data conversion;; Database transition to MySQl, Aurora, etc.
Ø UAT required
Re-­Architect**
Ø Application architecture changes may also require Up-­Version or Porting
Ø Middleware, data modernisation;; application consolidation / stacking
Ø UAT required;; HPC Grid, No ITIL
R1
R2
R3
R4
R5
R6

28. So What Can We Learn From
GE’s Story To Date?

29. ….Organisations All Over the World are Using AWS
to Retire Their Legacy Technology Debt
Kaplan Closes 8 Data Centers.
By Migrating Data Centers, Wilmar Saves 50% in CAPEX.
Delaware North Moves Data Center to Save $3.5M
Over Five Years.
Hess Uses AWS to Streamline Data Center Migration
in 6 Months.
News UK Shortens Time to Market by 6 Months by
Migrating 60% of its Data Centers.

30. ….and Learnings are Leading to an
Accelerated Migration Pace
In just three months, Condé Nast was able to migrate over
500 servers, one petabyte of storage, various mission
critical applications (such as HR, Legal, and Sales), and
over 100 database servers into the AWS Cloud.

31. ….The move to AWS provides a platform to transform
your IT cost base
100%
30%
Today DC in AWS Right-­sizing AWS
Optimized
Apps
Move to
Aurora
Move to
Open
Source
Corporate
Apps aaS
on AWS
Migration to
Workspaces
True AWS
Optimized
Focus of initial migration
For illustrative purposes only

32. What are the characteristics of a potential customer?
Existing production AWS workloads, trained teams, and Enterprise Support.
A focused objective that includes 200+ applications and a clear timeline.
Strong Executive sponsorship, a clear value proposition, and commercial terms in
place.
Willing and able to invest resources and make financial commitment.
Clear security and compliance plans that support this change in their business.

33. Plan
Go-­No-­
Go Project
Launch
Project
Launch
So what could an engagement look like?
Migration
Planning
Workshop
Joint Assessment &
Planning
Migration
Program
commences
1-­2 Days 4 Weeks*
Decision
Meeting
Scope dependent*
Customer team+

34. Closing Thoughts
Cloud in the Enterprise is no longer an experiment
For us this is no longer an experiment, this is no longer a test. ... It's inevitable.
GE CIO, Jim Fowler, October 2015
Global patterns for success are emerging -­ and should be leveraged by
fast followers
Cloud is not a commodity – consuming the platform natively will deliver
sustainable customer outcomes
Zero infrastructure, everything as a service – Infrastructure is no longer
a critical component of your value chain

35. AWS Training & Certification
Intro Videos & Labs
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help you learn to work
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– in minutes!
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taught by accredited
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Learn how related
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skills and expertise –
identify qualified IT
talent or show you
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37. Thank You!