The cloud offers a first-in-a-career-opportunity to constantly optimize your costs as you grow and stay on the bleeding edge of innovation. By developing a cost-conscious culture and assigning the responsibility for efficiency to the appropriate business owners, you can deliver innovation efficiently and cost effectively. This session will review a wide range of cost planning, monitoring, and optimization strategies featuring real-world experience from AWS customers.

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AWS re:INVENT
ENT203 – BUILDING A BETTER
BUSINESS CASE FOR CLOUD
Shahbaz Alam – AWS Professional Services, EMEA
Rehan Qureshi – AWS Professional Services, Canada

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MORTGAGE LENDING CONSUMER BANKING E-COMMERCE
EVENT TICKETS TELEVISION HEALTHCARE
DISRUPTION IS AROUND US…

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WHAT TO EXPECT FROM THIS SESSION
• Review components of a cloud business cases
• What is typically missed
• Tools and frameworks to build a better business case
• Illustrative examples

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REAL LIFE BUSINESS CASE: FINANCIAL
SERVICES CUSTOMER
Economics of Cloud Overall, AWS was 34% cheaper vs. on-premises
Technology Optimization 64% cost reduction in non-production environments
Significant database license cost savings by adopting Amazon Aurora
Transformation Impact Flexible operating model (self-managed, AWS Managed Services, or MSP)
Business Value 28% IT productivity improvement

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TYPES OF BUSINESS CASES
High Level Business Case
High-level, designed for establishing direction for the Cloud journey. Based on high-
level data inputs. Directionally accurate
Refined Business Case
More refined than directional, adds greater detail around people, designed for
confirming high-level business case. Based on multiple data inputs. 80% Confidence
interval of accuracy.
Detailed Business Case
Deep-dive of multiple data points, designed for Boards to approve adoption of cloud /
reinvention of cloud. Highly accurate.

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THE RIGHT TIME TO BUILD A BUSINESS
CASE…
Here
Here
Here
At any stage of adoption:
• Project
• Foundation
• Migration
• Reinvention
Develop any type of business case and
refine as needed throughout the stages.
Here

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TCO AS THE BASELINE

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TCO = ACQUISITION + MIGRATION +
OPERATIONS COST
Hardware – Server, Rack
Chassis PDUs, ToR Switches
(+Maintenance)
Software - OS,
Virtualization Licenses
(+Maintenance)
Server Costs1
Facilities Cost
Space Power Cooling
Hardware – Storage Disks,
SAN/FC Switches
Software - BackupStorage Costs2
Facilities Cost
Space Power Cooling
Network Hardware – LAN
Switches, Load Balancer
Bandwidth costs
Software – Network
Monitoring
Network Costs3
Facilities Cost
Space Power Cooling
3rd Party tools – network
discovery, migration, storage,
database
Labor costs – FTE,
Consultants
Migration Costs4 Duplicate Environment
Lease Penalties
IT Labor Costs5
Extras6
Server Admin, Virtualization Admin, Storage Admin, Network Admin, Support Team
Project Planning, Managed Services, Training, Legal, Cost of Capital

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TECHNOLOGY OPTIMIZATION

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THE FIRST RULE OF TECHNOLOGY
OPTIMIZATION…
Compare your current on-premises environment to your future
state re-architected AWS environment, NOT a replica of what exists
today.
≠

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IMAGINE…
A world free of managing infrastructure

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THE 5 PILLARS OF TECHNOLOGY
OPTIMIZATION…
Fit Price Scale IterateServices
Purchasing
Options
Licensing
Options
Instance Type
Instance Family
Storage Type
Storage Class
Managed
Services
Higher Value
Services
Time Based
Event Based
Periodic Reviews
Periodic Updates

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ENABLE YOU TO SIMPLIFY THE UNDERLYING
STACK…
Application
Operating System
Hypervisor
Storage
Servers
SAN
Networking
Power
Facilities
Real Estate
Application
EC2 (Servers)
S3 (Object Storage)
EBS (Block Storage)
Application
AWS Serverless
On-Premises
Cloud Foundations
Higher Value Services

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TRANSFORMATION IMPACT

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MANY NON-TECHNOLOGY COMPONENTS
ARE FORGOTTEN IN BUSINESS CASES…
Business Alignment
Governance and Policy
Operational Integration
Continuous Deployment
Talent Optimization
Application Optimization
On-Demand
SecurityCompliance
Cost Control
Reporting
Core Competency
DevOps
Legacy Modernization

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USE THE AWS CLOUD ADOPTION
FRAMEWORK AS YOUR GUIDE…
Cost of Business Transformation
• Realigning IT Strategy
• Vendor Management
• Shadow IT / Line of Business IT
Realignment

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USE THE AWS CLOUD ADOPTION
FRAMEWORK AS YOUR GUIDE…
Cost of People
• Cloud COE
• AWS Training
Cost of Governance
• Standards and Control
• AWS Consumption Model
• Financial Management
• Capacity Management
• Asset Management

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USE THE AWS CLOUD ADOPTION
FRAMEWORK AS YOUR GUIDE…
Cost of Platform Evolution
• Legacy Modernization
• Application Refactoring
• Application Re-Architecture
Cost of Integration with Existing Tools /
Processes
• AWS Native Services
• Cloud Operating Model
• Cloud Operations

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COST OF INACTION
Software
Licensing
Best of Breed
Integration
Hardware
Refresh
Application
Modernization
True AWS
Optimized
Total Cost of
Inaction
Cost

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BUSINESS VALUE

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START BY UNDERSTANDING HOW IT CAN
HELP THE BUSINESS…
Lower the time
spent on building
and supporting
infrastructure
Dedicate more IT
resources to
innovation
Concentrate on
new business
initiatives and
projects

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Tangible cost savings associated
with migrating to the cloud are not
the only benefits gained from your
cloud transformation.
Quantifying the business value
includes accounting for intangible
benefits that the cloud can have on
your business and your bottom line.
UNDERSTAND THE BENEFITS

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• Eliminate hardware refresh programs
• Reduce forecast uncertainty by
matching supply with actual demand
• A pathway to optionality
• Reduce or eliminate IT operations
tasks through automation (OS
patching, storage admin, testing)
• Reduce security compliance costs that
are built into the AWS platform
• Eliminate hardware maintenance costs
• Transparency drives a lean mindset
O p e r a t i o n a l C o s tC o s t A v o i d a n c e
QUANTIFY THE TANGIBLE BENEFITS

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• Rapid and less
expensive
experimentation
• Faster application
development
• Faster business
decisions = faster
time to market
• Individual task
productivity
• Self-service culture
• Increased
automation
• Developer
satisfaction =
higher retention
• Improved system
performance
• Less downtime
• Improved security
posture
• More incremental
changes = reduced
bugs
QUANTIFY THE (IN)TANGIBLE BENEFITS
Business Agility Workforce Productivity Operational Resilience

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ENHANCE BUSINESS VALUE…EXPERIMENT
FREQUENTLY!
“Want to increase innovation?
…Lower the cost of experimentation”
• AWS Services enable experimentation via primitives
• Companies can build on existing services
• Rapid prototyping and iteration are key

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BUILDERS DON’T WANT TO BE BLOCKED…
THEY WANT TO BUILD AND INNOVATE!
Idea
Completed
Project
Not
possible
We
don’t
support
that
Maybe
next year
That’s a
change
order

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CREATING THE RIGHT BUSINESS CASE
ENABLES YOU TO…
Correctly define your current and future costs
Envision the art of the possible
Accurately reflect your cloud transition
Quantify your tangible and intangible benefits

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PLEASE REMEMBER TO
COMPLETE YOUR SURVEY!

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THANK YOU!