The widespread cloud adoption in today’s digital era is only one part of the story. Behind the façade, many enterprises struggle to implement an effective cloud strategy. The lack of a well-defined cloud strategy leads to complexities. Complexities, in turn, lead to operational inefficiency, increased costs, and heightened security risks. The cloud, far from delivering competitive advantages, becomes a resource drainer. 

Fragmented operations

In many enterprises, the cloud grows organically. They subscribe to cloud resources on an ad-hoc basis. Very soon, a patchwork of disparate cloud services develops, with poor integration. Such a haphazard approach makes the system complex and difficult to manage. It:

• Raises compatibility and collaboration issues. 
• Cause data silos and shadow IT, impeding analytics. 
• Impairs visibility across systems, stifling productivity. 

Enterprise efficiency and competitiveness go downhill. Costs and inefficiencies increase.

As the first step towards a successful cloud strategy, define the role of the cloud in the enterprise IT strategy. 

Successful cloud strategy depends on identifying and prioritising worthwhile use cases. Legacy applications tend to be very stable and need very little maintenance. Migration to the cloud should be worthwhile to overcome the hassles of disrupting a stable system. For instance, banks retain sensitive workloads on-premises or in private clouds. But they use the public cloud for innovation. Manufacturing industries use the edge for latency while analysing local factory data.

Also, choose the most suitable model, from public, private, hybrid, or multi-cloud. A legacy system that does not need the cloud is better retained on-premises. Hybrid multi-cloud environments suit such enterprises. Ensure tight integration of the cloud services into the enterprise architecture and operations.

Make sure the cloud resources sync with existing application strategy and architecture.

Wasted resources

The lack of a clear cloud strategy leads to inefficient resource allocation. Enterprises fritter away their investments without attaining a positive ROI or anything substantial.

Also, cloud costs spiral out of control very fast. Enterprises may over-provision or underutilised cloud resources. They may choose the wrong pricing models or allocate improper resources. 

Keeping cloud costs in check requires:

• Monitoring cloud usage and deploying proactive plans to shut down wasteful usage. Proactive FinOps prevent runaway costs. For instance, each matrix and API call to the matrix comes with a cost. Some applications may have hundreds of such calls running undetected in the background, leading to huge bills.
• Effective governance. Governance frameworks make cost allocation and attribution. It makes the departments or teams responsible for specific cloud resources and makes costs explicit. Such transparency fosters accountability and encourages responsible resource usage.
• Tracking ROI for every business initiative, over and above the company or department ROI.

Underestimating cloud migration issues

Many enterprises underestimate the effort and cost of cloud migration. Migration to the cloud is rarely a one-off project. Simple lifts and shifts rarely work. 

Realising the advantages offered by the cloud requires refactoring the migrated applications. Unoptimised applications become sluggish and cause performance bottlenecks. They cannot leverage the cloud’s on-demand scaling capabilities. Also, any inherent code inefficiencies hinder performance and increase operational costs.

Cloud migration is expensive as well. Many enterprises underestimate the costs. They end up with budget overruns that derail the enterprise’s financials. Soon, the enterprise ends up cutting back on their cloud investments, rendering the cloud strategy waste.. 

To get migration strategy right,

• Get a complete picture of all cloud-related costs upfront. Be especially wary of hidden costs that surface all too often.
• Consolidate and merge cloud-based services to reduce platform sprawl and cut costs. For instance, use a multi-modal database as an alternative to multiple databases to handle different data types. 

Underestimating the human equation

Most cloud strategies confines to technical issues. But success requires much more than taking care of the technical challenges. There is no workaround to convince the incumbent infrastructure teams.

Drive home the benefits of cloud adoption to the stakeholders. 

The potential benefits include optimisation, productivity benefits, more revenues, and better customer experience. The exact benefits depend on the enterprise-specific context and business priorities. For instance, the cloud may speed up processes in unimaginable ways. A person can look at 150-200 VMs on-premises. The same person can look at 12000 to 15000 VMs.

Security vulnerabilities

A poor cloud strategy opens the door to security vulnerabilities and data breaches. 

The cloud entails shared ownership of security responsibilities. Generally, the service provider assumes responsibility for the underlying infrastructure, hardware, and software. The customer takes care of the security of the data, applications, and configurations. Misconfigurations and ambiguities related to the shared models leave security gaps. Threat actors exploit such vulnerabilities. 

A robust cloud strategy co-opts guardrails to safeguard against internal and external threats. Such a strategy co-opts layers of protection.

The key security-related inclusions in a robust cloud strategy include:

• Strong access controls and identity management.
• Encrypting data at rest and in transit.
• Regular monitoring and audit of cloud activity for suspicious behaviour.
• Prompt patch management 
• Regular back-ups and disaster recovery procedures.

Compliance risks

Failure to align cloud operations with regulatory requirements exposes the enterprise to liabilities. Regulations such as the European Union General Data Protection Regulation (GDPR), the United States Health Insurance Portability and Accountability Act (HIPAA) and the Payment Card Industry Data Security Standard (PCI-DSS) place onerous compliance requirements on most enterprises.

A well-defined cloud strategy co-opt compliance requirements to the cloud operations. For instance, the cloud strategy may co-opt a local cloud to comply with data sovereignty mandates.

Vendor lock-In

Many enterprises do not put much thought into the implications of vendor lock-in. They focus on the ease of getting started and draw up long-term contracts. They may soon get struck by a vendor who may not provide all the necessary services or resources. Switching vendors may become expensive or difficult due to the upfront contract.

Vendor lock-in leads to rigid infrastructure that impairs flexibility and inhibits easy scale. The enterprise may struggle to accommodate sudden workload spikes, hindering agility and competitiveness. Also, the vendors may raise prices, limiting the ability to migrate or negotiate better rates.

For instance, a cheap plan by one vendor may come at the cost of long-term vendor lock-in and over-reliance on them. 

Have a long-term plan. Resist the temptation of compromising on the fundamentals of cloud policy for short-term gains. 

The cloud is a transformative force that demands a strategic approach. Investing time and effort to develop a sound cloud strategy delivers rich returns through mitigated risks, cost savings, better agility, and improved innovation capability. Also, success depends on approaching the cloud as an evolving journey, with the enterprise reviewing the strategies to meet changing business requirements.