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5 Reasons Companies Move to the Cloud and What Prevents Them from This Step

Recent LogicMonitors survey results presented by Forbes magazine revealed that worldwide public cloud service revenue is expected to reach US$331.2 billion by 2022.

It’s not surprising, as in recent years we have been observing significant growth in cloud computing. The cloud has already managed to change key business attributes for most industries, including business models, revenue channels, and workload, and it’s still growing in popularity.


Why Do So Many Companies Decide on Cloud Migration?

There are a great many arguments in support of companies migrating to the cloud.

First, stakeholders are attracted to the reduced costs made possible by the cloud, as providers promise to lower operating costs by charging only for the used capacity.

Second, cloud hosting enables companies to run their software infrastructure more efficiently and scale it in case of any business change.

Third, the cloud application can be accessed at any time and from anywhere, using only an internet connection.

One more huge reason companies migrate to the cloud without hesitation is simplicity. It is far easier to contract professionals in the field and get high-quality services than try to build a similar solution on your own. Cloud systems are highly complex and require on-time maintenance and dedicated staff, but not every enterprise has the budget for it.

The above reasons for investing in cloud migration are all very compelling, but on top of them, we would like to highlight five more reasons companies are moving to cloud environments.


5 Main Reasons Companies Move to the Cloud Environment

1. Cost Efficiency

The cloud is a haven for startups, which don’t have the resources to purchase expensive hardware and don’t have a clear understanding of future demand. The flexible payment models of cloud providers are based on a pay-per-use

approach, allowing companies to save money by paying only for what they use. However, some experts say redundancy often occurs. Cloud solutions not only conserve funds, but increase revenue, according to Dell.

“Сompanies that invest in big data, cloud, mobility, and security enjoy up to 53% faster revenue growth than their competitors.”

GLOBAL TECHNOLOGY ADOPTION INDEX BY DELL

2. Reliability

When your datacenters are located in-house, it’s imperative to create a disaster recovery strategy to properly address any unexpected problems or setbacks you may encounter. Without a disaster recovery strategy you won’t be able to ensure business continuity. With an effective strategy you can make sure any system collapse won’t last long and the disruption to the system will be minimal. Cloud service providers are experts in keeping their environments working seamlessly, so you don’t have to worry about disaster recovery. On top of this, all data can be mirrored at multiple redundant sites on the cloud service provider’s network, which

reduces the likelihood of losing it to close to zero, unlike desktop computing, in which a hard disk crash can destroy all data completely. Power failures, viruses, fire accidents and mechanical damage to hard drives are the main causes leading to data loss.

Blog hosting service JournalSpace closed because of users’ data loss due to either OS failure or human error. Unfortunately, they didn’t have backups, so every blogger who hosted their site on the platform lost their data too. The sad reality is that it can take only a minute for a six-year-old business to be completely destroyed.

3. Global Scale

Cloud solutions give you exactly the amount of resources you need at any given moment. You can increase the number of app users from 20 to 2,000 in one hour and the system will continue to perform on the previous level, providing more computing power, storage, and bandwidth from the right geographic location. In contrast, if you need to increase the 

bandwidth for an on-premises system, you’ll need to upgrade the infrastructure; that entails a full-fledged software development project, and it’ll take time, manpower, and money. According to a survey by InformationWeek, one of the major reasons for a business to move to a cloud is the ability to meet business demands quickly.

4. Productivity

Another difficulty of on-premises hosting is the need to carefully manage the project. This means a lot of work for IT teams, including hardware setup and software patching. When using cloud services, however, you can leave most of “racking and stacking” tasks to the cloud provider, freeing up in-house IT teams to spend their

time on more critical tasks. One more point that has a positive influence on software productivity is fewer bloated programs hogging your computer memory, as most of them are placed within cloud infrastructure. Thanks to cloud solutions, not only do your IT teams work faster, but so does the software itself.

5. Ultimate Access

When your employees work remotely, on-premise hosting doesn’t work, while cloud works perfectly an unlimited access anywhere

and anytime. It enables collaborative work for teams with traveling sales staff, freelancers and remote employees.

Extra point

According to the IDC Industry CloudPath 2019 top reasons companies move to cloud are software modernization, lack of agility and new data center requirements.

The Biggest Roadblocks on the Way to the Cloud

As you can see, the cloud undoubtedly has many considerable advantages. Why, then, are there still companies that are not willing to migrate to the cloud as soon as possible?

There are several issues that affect the migration of businesses to cloud providers, and some of them are critical for organizations. So, what’s in the cloud box that other software development companies won’t tell you?

Data Sensitivity

In a recent Forbes article titled “83% of Enterprise Workloads Will Be in the Cloud by 2020” it was revealed that 66 percent of IT professionals say security is the most serious problem encountered when adopting an enterprise cloud computing strategy. Moreover, data isn’t always applicable for migration from the tech point of view; this makes the data migration process one of the most complex points while re-platforming your solution.

How can businesses overcome the data sensitivity issue? There are steps you can take in advance. First, take some time to get a full assessment of your current system, and then carefully plan the migration process that will be performed by highly professional data engineers.

It’s Still Expensive

The Forbes article mentioned in the previous section refers to a report that states upfront migration costs often outweigh the long-term savings created by IaaS. Imagine company management performing a huge migration project that takes four years, investing an enormous budget and spending a lot of time managing the team that was hired just for this project. In the end, the earliest the multimillion-dollar cloud migration spending can be returned is in 30 years. It’s too long to wait for your return on investment, don’t you think?

How can businesses prevent inefficiency when it comes to the costs of a cloud migration? It takes some planning up-front. Don’t become a victim of enthusiasm; ensure that you start the project only when you have a cost-benefit project estimate. Sometimes it’s better to continue using an internal server than to move to the cloud.

Geography Matters

As the cloud is all about having a worldwide network, cloud providers can’t avoid the latency issue. If your company’s application uses a data center situated on the other side of the planet, it works more slowly than it would on a local connection. One more difficulty when it comes to geography is the diversity of laws in different countries. The attitude toward data sovereignty is not the same in Europe as it is in the United States, for example, so European companies are worried their data centers in the U.S. can be accessed by local law enforcement, while their own data policy is regulated by the General Data Protection Regulation (GDPR).

How can a company protect itself from geographical issues that may arise in the cloud? Just be aware of the geography issue and take where your data center is situated into consideration when you choose your provider. In fact, many leading cloud vendors have built regional data center networks to allow clients to keep their data within their region. In this way, Microsoft offers Azure cloud services from two data centers in Germany, so that stored customer data is under full German company control as a “data trustee” and even Microsoft can’t access it without permission (from the company or the customers themselves).

“A half of business owners say the increasing barriers to globalization threaten their ability to: consume or produce cloud-based services (54% agreed versus 14% disagreed); use or provide data and analytics services across national markets (54% vs 15%); and operate effectively across different national IT standards (58% vs 18%)”

ADAPTING BUSINESS TO A DIGITALLY FRAGMENTED WORLD BY ACCENTURE

Lack of Business Flexibility

Let’s be honest and recognize that big companies that have existed for decades are not so flexible, yet migrating to the cloud means fundamental changes in business processes. Even minimal disruption of business processes can cause a company to collapse, and the scale of this collapse depends on the size of the company. Bigger projects mean bigger risks, and it’s understandable why companies prefer to avoid this. At the same time, fear of change can come at a much higher cost, as staying the same means ignoring opportunities to grow and evolve with the current market.

How can companies deal with the issue of business flexibility? Unfortunately, you probably can’t make your big company more flexible, but you can moderate the influence of cloud migration. We’ve seen the success stories of tackling cloud migration this way: for example, a mobile operator fully modernized the company software and, thanks to proper planning, it shortened the disruption of the telephone connection to one hour.

Final Thoughts

Cloud technology is supposed to simplify business processes, improve productivity and optimize the use of resources. With all of its advantages, there’re serious pitfalls of the cloud transition that you should take into account. So don’t lose sight of your ultimate goals and choose a qualified vendor that will support you on each step of the cloud migration.

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