By: Ashutosh Dixit, Senior Director, Consulting

Public cloud computing has been part of the enterprise landscape for over a decade. The rush to migrate workloads to the cloud has been significant, yet the goalposts for digital transformation continue to move due to continuous advancements in cloud services and technologies. The appeal of cloud-based data centers lies in their pricing flexibility, data security, and vendor-managed operations. Despite these advantages, misconceptions and myths about cloud computing persist. This blog will address and clarify prevalent myths based on my extensive experience as a cloud computing consultant.

Myth 1: Cloud computing is always a more cost-effective solution

Many companies were attracted to cloud computing with the promise of cost savings. However, a significant number have been disappointed with the financial results, with some even reporting that their cloud spending has exceeded their on-premises data center costs.

Myth-busting facts

Cloud computing does not inherently reduce costs; strategic adoption is the key to cost-effectiveness. Early adopters of cloud technology often utilized a “Lift-and-Shift” strategy, which involves directly transferring pre-existing workloads to cloud-based virtual machines. This approach was the easy first step towards cloud adoption but migration without optimization is recognized as being likely to result in increased costs over time.

Cloud providers offer a variety of methods for deploying workloads, such as serverless architectures, back-end-as-a-service, fully managed services, and managed containers. By executing a well-planned application rationalization and modernization strategy, businesses can make informed decisions about service types and storage options that lead to more cost-effective cloud services and features. Strategic adoption can realistically help companies achieve savings of more than 35% on non-cloud infrastructure costs.

Right approach for cloud adoption

Maximizing cost savings in cloud computing is not merely a matter of selecting the right services or storage options. It necessitates a comprehensive strategic approach that goes further than mere technology. Good governance is essential for managing cloud expenditures and ensuring alignment with business objectives. This governance framework should include well-defined policies, procedures, and cloud resource allocation and usage roles.

A successful transition to the cloud requires a shift in both mindset and business culture. Companies must re-examine their current operating models to identify areas that can be optimized or restructured to leverage cloud capabilities better. This re-examination often reveals that traditional IT cost models are ill-suited for cloud services’ dynamic, scalable nature.

Implementing FinOps is fundamental to navigating this complexity. FinOps provides a set of practices that bring together technology, business, and finance professionals to manage cloud costs effectively. It enforces real-time monitoring and cloud cost analysis, for more informed decision-making, promoting a culture of financial accountability across the organization.

Myth 2: Cloud is not secure enough for regulated data

The prevailing concern that cloud environments are inherently insecure has deterred many organizations from migrating regulated or sensitive data to the cloud. Concerns around data availability, integrity, and compliance with local regulations have further complicated the issue. Data sovereignty, particularly for companies operating across multiple regions, has been a significant challenge. Despite advancements in cloud security best practices and compliance certifications, reservations about data security in the cloud persist. Furthermore, it is a common notion that cloud computing is not safe for banking organizations as it does not provide adequate control over customer-sensitive banking data.

Myth-busting facts

While it is understandable that companies are cautious about where their data resides, it is crucial to recognize that cloud security is a shared responsibility between the cloud vendor and the customer. Cloud providers are responsible for the security of the underlying infrastructure and services, whereas customers are accountable for implementing cloud security best practices for their data. Cloud vendors offer robust physical security measures and compliance certifications to assure businesses of their data safety. Moreover, most cloud services now default to a ‘no access’ setting for data, requiring explicit permissions to be set. While encryption, least-privilege access and other cloud security best practices can be enforced, the onus is ultimately on the customer to configure these settings appropriately for their specific data needs.

Right approach for cloud security

Addressing cloud security is a complex undertaking that necessitates a multi-dimensional strategy, integrating governance, risk assessment, and advanced technological solutions. Without a nuanced understanding of cloud intricacies, it is reasonable to be cautious about securing data in the cloud. Data sovereignty considerations are particularly salient for organizations operating in multiple regions, requiring a nuanced understanding of local and international data regulations. The challenge often lies in attempting to apply on-premises security principles to a fundamentally different paradigm. However, the requisite experience, skills, and talent are readily available to apply the right approach and mindset for cloud security.

Cloud computing gives an adequate amount of control based on the services selected and workload opted for.  Be it retail, banking, insurance, or e-commerce, customers across all industries have successfully adopted the cloud. By leveraging the right security best practices, services, controls and data access models, data in cloud computing is as safe as your on-premises system. Based on the nature of data and where it is stored, cloud vendors provide a portfolio of guidelines that can suit general data security requirements. It is up to customers and their seasoned architects to evaluate and consider these guidelines.

Keeping the human aspect in mind is crucial for cloud security. Security strategies’ effectiveness depends on employees acting in accordance with them. Training and awareness programs as fundamental defenses against breaches equip employees with the knowledge to prevent, identify, and respond to security threats. This establishes a culture of security awareness and shared responsibility for data and system protection. By cohesively integrating these diverse elements, organizations can construct a robust, adaptive cloud security strategy that effectively mitigates risks and safeguards critical assets.

Myth 3: Cloud ROI is easily achievable

Another cloud computing myth is that cloud computing yields an immediate return on investment (ROI). This has set unrealistic expectations for many organizations. C-suite executives often think they can expect the financial benefit of cloud adoption from day one.

Myth-busting facts

Contrary to the popular belief that ROI from cloud computing can be rapidly achieved, the financial benefits often materialize over an extended timeframe. While the cloud offers long-term advantages such as scalability, flexibility, and rapid innovation, these are not immediately quantifiable in terms of ROI. Upfront costs related to hardware, software licensing, and migration projects are part and parcel of the transition to the cloud. Moreover, the shift from capital expenditure (CapEx) to operational expenditure (OpEx) provides financial flexibility but does not guarantee immediate returns. Therefore, ROI in cloud computing should be assessed in a broader context that includes both immediate expenditures and long-term strategic advantages. It is observed that it may take over two to three years to realize ROI from the cloud.

Right approach for cloud ROI

Achieving ROI in cloud computing is not solely a matter of cost-saving; it necessitates a comprehensive strategic approach that extends beyond immediate financial calculations. A robust governance framework is essential for effectively managing cloud expenditures and aligning them with broader business objectives. This framework should encompass well-defined policies, procedures, and roles for cloud resource allocation, usage monitoring, and cost management.

Organizations should also consider adopting a total cost of ownership (TCO) model, which accounts for both direct and indirect costs associated with cloud adoption. This includes factors such as training, governance, and compliance, providing a more comprehensive view for ROI calculations.

Additionally, leveraging FinOps principles and cloud analytics tools for real-time insights into resource usage and costs can facilitate ongoing optimization and more accurate ROI projections.

By adopting a multi-dimensional, strategic approach to cloud ROI, organizations can achieve cost savings and realize long-term value and business agility.

Myth 4: Business continuity in the cloud

Another common myth is that cloud computing is prone to outages. Many enterprises think an outage from the cloud vendor end can completely disrupt their business operations.

Myth-busting facts

Cloud computing is reliable from a business continuity perspective. Although cloud computing is prone to outages similar to on-premise data centers, vendors have adequate measures in place to keep their cloud data centers running despite any outages that may occur. This is essential as a single cloud vendor often has many businesses dependent on them.

Their “no single point of failure” policy keeps cloud-based workloads more reliable than on-premise data centers. Also, since they have state-of-the-art technology in place to detect and auto-correct outage causes, services tend to recover faster than on-premise data centers in case of any disaster.

Right approach for cloud-based business continuity

Cloud computing offers robust business continuity plans in terms of highly available and self-healing infrastructure,  and a variety of disaster recovery methods to suit workload and multi-location data centers. These factors make it a much more reliable choice than an on-premise data center for enterprises.

Conclusion

Cloud computing has enabled businesses to unlock new potential and innovative possibilities. However, as this technology grew in the last decade, expectations grew along with it and certain myths gained prevalence. These cloud computing myths were often due to lack of awareness regarding cloud usage, adoption, and execution. Armed with the myth-busting facts from this blog, you will be able to take the right approach for your enterprise to reap the benefits of successful strategic cloud adoption.

References:

• 101+ Cloud Computing Statistics That Will Blow Your Mind, Cody Slingerland, Cloudzero, July 18, 2024:https://www.cloudzero.com/blog/cloud-computing-statistics/
• Cloud adoption to accelerate IT modernization, Nagendra Bommadevara, Andrea Del Miglio, and Steve Jansen, McKinsey Digital, https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/cloud-adoption-to-accelerate-it-modernization