You kick off your cloud migration journey. You lay out a plan, choose the best suitable strategy, and keep track of vital parameters like the number of applications migrated, performance, etc. However, your core business committee is skeptical about the benefits that the cloud brings. When your stakeholders seem unimpressed with the results that take immense effort and investment, it hints towards unprecedented issues.
Value Gap: the most overlooked Obstacle
Cloud migration is more than just technological advancement. It requires you to figure out a long list of technology topics like account hierarchies, permissions, supplying written scripts, configuring virtual machines.
Initially, migration will quickly yield benefits. It makes applications more robust, reliable failed server recovery, reduces costs due to optimized resource usage, better monitoring, and security. After initial noticeable business value addition, the track of technical progress and business value would diverge. Despite technical migration, the forecasted and actual value will level off. It is a value gap. The Value gap is when your investment and progress in the technological area are not in proportion with generated business value.
Cause of the value gap
Determining the value gap is much easier than turning it into real-life advice. The most common reason is organizational change. Though, everyone is aware of it. However, it fails to meet the pace of technical change.
It includes redefining internal processes, hierarchies, creating new job roles, and utilizing existing silos. Such changes take time which is one of the major causes of the value gap. It is a topic of utmost concern nowadays. Without it, you cannot leverage the maximum benefit of the cloud. For example, suppose your organization is willing to buy a large on-premise server that seems cheaper than a cloud instance. What they forgot to consider is the additional cost that they have to incur over years to come. If your purchasing team is making the comparison without considering scaling, hardware refresh, backup, and operation costs, they are undermining the abilities of the cloud.
So, organizations are rushing towards agile mode, holding digital workshops, and even instating autonomous teams to take up decisions. It appears to be helping though it isn’t. If you cannot define the business value of cloud migration, it is hard to benefit from these. Also, without a seamless software delivery pipeline, you might not achieve the value that you desired at the start.
Three actions to overcome the value gap -
A. Intertwined org-tech cycle
Better value assessing metrics increases transparency, allows you to make better decisions, and optimize value generation. In turn, it will increase return on investment, maybe a better software delivery pipeline. Lower resistance in software delivery will increase transparency. Such organizational and technical alignment is a must for diminishing the value gap.
A. Focusing more on business metrics
Most companies thoroughly access the environment but keeping only technical parameters in mind. Such metrics are good. But they are far away from real success in terms of business. These IT metrics are of use to the IT department only as they lack business oriented-parameters. The executives will be interested in decreased operational costs, better performance in case of a surge in demand, customer satisfaction, and security.
It is good to have technical metrics at the start. Switching to business metrics with time will help in overcoming the value gap.
B. Practice Quality over quantity.
While starting the migration, you lay down a basic foundation aiming to move a large number of applications to the cloud. Benefits will be visible in terms of cost reduction, increased bandwidth, and better transparency. However, you will not look at automation of application deployment, improving software delivery. Rather than moving application with low business value, migrate applications with more business value potential.
Conclusion:
Almost every cloud journey will hit the value gap. Perceive it as a sign of realignment between an organization and IT. Chain of technical and organizational changes is the solution to smoothen your cloud journey and boost your transformation.
Reach out to us at contact.us@virtuetechinc.com to know more about we can be of help in smoothening your Cloud journey.
