Top-Down Cloud Transformation strategy

In my last article (Link), I wrote about two strategies that Organizations take for their cloud journey. In this article I will go a bit deeper into Top-Down strategy. In which scenarios the strategy works, what are the key deliverables, how to plan and track.

Let’s first look at the different scenarios in which Top-Down strategy works best.

1)    You are a traditional business with your IT systems being put in place since early 1990s or 2000s and some even before that

a)     You are feeling the strain on your business with the evolving business model and are planning for a business transformation.

b)    Your existing IT landscape is not able to cope up with the change in business practices.

c)     You often restrict yourself by the IT systems you have in place.

d)    You wish to adapt to a newer business model and remain flexible to future changes in business

2)    You are a growing business and have to scale up rapidly to meet the increase in demand

a)     You are working with a shoestring budget and need to optimizer spend on your IT systems

b)    There is a seasonal spike in your business, you need flexibility in terms of the capacity of resources consumed

Now let’s look at a few key deliverables for this strategy

1.     Application portfolio: You always start by going through your application portfolio. It is important to know how many applications you are dealing with. IT will be directly responsible for IT4IT tools, cross functional systems like email, communication, etc. Each business unit will be owner of Core business and support applications. It is advisable to spend some time to collate this list across enterprise. You will be surprised with the application portfolio your Organization has.

2.     Cloud Guidelines & Principles: Enterprise architecture board has the responsibility to create a document that summaries the guidelines and principles for usage of cloud in the enterprise. This document acts as a reference for other departments to share their cloud journey.

3.     Assessment of Applications: Next logical step is to do an assessment of these applications. You can do an in-house assessment or hire a 3rd party vendor to perform the assessment. These should be based on the cloud guidelines and principles defined by the architecture board. You will find there are various known assessment outcomes defined like 3 Rs, 5 Rs, 7Rs, etc. Pick the one that suits your business case. Come up with outcome and present it to various stakeholders for their approvals

4.     Cloud Strategy plan: Once you have the outcome of your assessment, you need to create a plan to execute your strategy. This takes input from the assessment, business priorities and budget allocated. You would want to group your applications based on proximity of each application in the group or dependencies they have on each other. You can also plan based on the budget you have in hand. There can be many more ways to achieve this and your business context will drive this decision

5.     Target Operating model: This an important piece of deliverable that you need to spend time on before you start your cloud journey. At a high level following things have to be considered. It’s a long process and requires time to finalize. Also it evolves as your Organization becomes mature in its cloud journey.

a.     Budgetary changes – Capex V/S Opex

b.     DevOps – Change in your project execution methodology

c.     Vendor competency and IT staff skills

d.     Change in RACI and new controls for Cloud adoption

We looked at some of the key deliverables for cloud transformation. Some are relevant for Bottom-Up strategy as well. They just defer in the content. Lastly, how will you know that your strategy is on track and is providing you with desired results. To track this, you have to define easy to measure KPIs. Choose your KPIs wisely, they should be easy to capture, easy to calculate and easy to understand. Some of the KPIs that I can think of are:

·       Cloud adoption rate (Percentage)

·       Time to Release (Days)

·       Operations improvement (Percentage)

·       Cost Optimizations (Percentage)

I hope this article provided you with some insight into the Top-Down Cloud Transformation strategy. In my next article, I will write about Bottom-Up cloud strategy. In essence the deliverables are same, its just the way you approach deliverables & track KPIs changes.

Information provided in this article is based on my own views and does not reflect the views of Organization I work for.