By Mindy Cancila, VP of corporate strategy, Dell Technologies
Over the last few years, organizations accelerated their digital transformation plans through investment in public clouds for speed and scale. But now, they’re looking at what’s next for their multicloud strategy and assessing what workloads run best in what cloud environments.
Last year, 33% of organizations moved applications from the public cloud to a data center or colocation facility, and according to Dell’s Innovation Index, 43% are embracing a mix of public and private cloud environments to achieve agility and innovation.
Traditionally, moving most workloads back on-premises has been viewed as “repatriation.” But what we are largely seeing today isn’t so much repatriation as rebalancing. Just like life, cloud strategy is like a balancing act: Organizations need to know which side to lean more to have the right balance in their portfolio.
On-premises infrastructure today is more efficient, simpler to deploy and now comes with flexible financial models. As organizations better understand the economics of public clouds – and on-premises solutions evolve to be more flexible – they are revisiting their workload placement strategy to be more purposeful. Those that reside in the public cloud or were initially earmarked to migrate there are being revisited.
Organizations are looking at their multicloud estate and working to find the right cloud mix based on “multicloud by design” – A successful multicloud strategy that helps reduce data complexity to optimize for greater savings and better business decisions. First, organizations need to understand cost, performance, availability, security and compliance, as well as the right skillsets and staff for their IT needs. After that, they’ll learn the kind of data and workloads more suitable for on-premises in private clouds or public clouds. Both options offer unique benefits, and it’s totally possible to get the best of both worlds – the right apps, services and workloads in the right cloud at the right time.
IT’s responsibilities have grown exponentially, especially with the rapid growth of AI applications and use cases, including generative AI that requires new skillsets. – Mindy Cancila, VP of corporate strategy, Dell Technologies
How to think about your “rebalancing” act
Rebalancing requires a reassessment of needs. If your usage varies month to month, so likely do your costs, making it challenging to predict public cloud spend. After auditing, 80% of organizations found public cloud spend was higher than expected. In some cases, it may be easier and more cost-effective to optimize infrastructure on-prem – particularly with new automation, tooling and compute capabilities – and avoid data egress fees altogether. In others, public clouds may be preferable thanks to the variety of innovative developer tools and speed of scale. Balancing the cloud budget may also mean adopting FinOps processes and tools that help control, report and manage spending and ensure you’re maximizing overall spend.
Optimizing costs in the long term may mean avoiding contract lock-ins – even with their attractive discounts. That’s where organizations can find themselves with unwanted outcomes or limited flexibility – like moving the wrong workloads or getting locked into committed spend beyond what was expected.
Flexibility and choice are key when it comes to a multicloud by design approach across multiple environments. In the past, organizations’ only choice for infrastructure was a lengthy Capex process. Public clouds then introduced Opex models, providing a more agile way for consuming infrastructure, but the flexibility came at a cost-premium. Now on-prem providers offer a similar flexible payment model, putting the choice back in the hands of customers based on workload and budget needs. Vendors that offer a more elastic, on-demand approach to consumption enable a right-size investment level and infrastructure for greater control – paying only for what you use. These models have met in the middle so now you can evaluate your options based on costs and workload requirements.
Simplifying cloud in a complex tech landscape
Costs and performance aren’t the only considerations in a world where data is highly distributed – think security and data requirements. For highly sensitive data, private clouds may be more desirable to ensure data stays within an organization. Compliance requirements may even require critical workloads to live in certain locations to adhere to government regulations or prevent accidental loss or unauthorized access.
IT’s responsibilities have grown exponentially, especially with the rapid growth of AI applications and use cases, including generative AI that requires new skillsets. These new workloads will run in multiple environments – at the edge, on-premises and across multiple clouds, which will create further complexities for management. It’s essential that organizations apply learnings from their multicloud strategy to their AI strategy to ensure cloud expenses don’t catch them off guard again. This is where multicloud by design strategy shines; a mix of public and private clouds that provide scale and flexibility while ensuring data mobility and visibility.
Rebalancing will require recalibration to hit the right cloud mix
This rebalancing will likely continue over the next few years as more cloud-based apps and services shape future IT strategies. Workloads moved on-prem today may go back to public cloud if that’s where they best meet current business needs – but companies will have greater ability to choose where they live with deeper strategic partnerships and technology integration.
Life is like riding a bicycle. To keep your balance, you must keep moving. What does it mean to rebalance your workloads? Are you having regular dialogues about achieving the right balance across your multicloud investments? There are no strategy kickstands. Make sure you look to the future with a strategy that embraces the power of the multicloud ecosystem and keeps your data safe to optimize your budget.