Outsource whatever does not add value your business and use a “Pay as You Go” model where you only pay for services that you use and conversely – if you don’t use something, don’t pay anything for it.
Experience has shown that cost savings by themselves are insufficient cause to move from on-premises to cloud infrastructure.
The answer usually comes down to a need or desire for organisational transformation. This is a look at some of the pressures and approaches to cloud adoption. In Australia a Royal Commission into the Banking and Financial Services industry exposed serious malpractice and breach of law and poor governance. Banks had charged customers for a service which had not been provided, money laundering was known to be happening but not reported as required uy law and mortgagees had been forced out of loans because the bank wanted to move to more profitable areas. Banks and insurance companies highlighted in the Commission’s findings have been forced to actively pursue business transformation.
Healthcare providers, telecommunications providers and businesses at the bleeding edge of technological change have likewise been forced to change the way they do business, not because of poor business practice necessarily, but because the way their customers do business has radically changed, such as ordering online via an app on their mobile phone, and so business needs to adapt to a new reality or face extinction. Customers have access to greater choice and expect more from service providers.
It is fascinating to hear business leaders share their experiences of cloud migration at AWS Innovation Day events and other forums. If you wish to be informed about these please contact us and we will curate appropriate events and keep you advised.
Some practical examples follow.
Optus, who were exclusive live streaming providers of the 2018 World Cup football competition in Australia, found that the spikiness of demand overwhelmed their capacity to provide. Rapid deployment within 48 hours onto infinitely scalable services via cloud was required i.e thinking outside the box of their traditional approach as a telecom provider.
Medibank, in 2016, were notorious for complaints about poor customer service and delays in refunds for medical insurance claims. Their problem was that they were running their business on a legacy of multiple disparate “hard wired” interconnected and dependent applications. Business transformation by focussing on small, quick changes that provided high value to customers gave them the momentum to turn their business satisfaction approval rating around and re-engineer the way they did things. Medibank embraces cloud
Boral, Australia’s largest building construction materials supplier, had a plethora of applications to maintain that did not work efficiently together. This limited their capacity to deliver improved services such as real time updates on the location and estimated arrival time of wet concrete deliveries by their fleet of 2,400 trucks around the country. They were able to move to paperless dockets for procurement, customer orders and invoicing over a two year journey of transformation into a cloud based business with an agile service culture. Boral moves to cloud
Lion Nathan Brewery, an Australian and New Zealand brewery has undergone an overhaul of its business systems as part of a business transformation that allows supplies and customers to have real time updates on logistics. Instead of taking a graduated approach starting with non critical services, they went "all in" and shifted everything to the cloud which enabled them to get much closer to their suppliers and customers so that each could track deliveries in real time.
Let's look at some global players
Nike, like many global businesses that want to run video clips on demand to advertise new product releases, have made extensive use of static websites hosted on S3 buckets to cope with millions of users at effectively unlimited scale.
Coca Cola is rolling out a serverless solution to its vending machines. When a customer wants to buy a drink from a machine an API call is made to the payment gateway to process the payment, then a trigger call is made by the payment gateway to AWS API Gateway (an AWS managed service) to invoke AWS Lambda which does the business logic of updating stock and processing the backend logistics data. Up until 2016 they had been using 6 EC2 T2.Medium machines that cost them $12,864/year to operate with all the support services but the serverless approach reduced cost down to $4500/year.