If you subscribe to an online storage service for your photos and files, then you can relate to a problem being faced on a much larger scale by companies around Australia.

Each month your credit card is billed, even though you’ve used just a fraction of your online storage limit. When you finally add up what you are spending on the subscription annually, you’re horrified at the cost — and the lack of value you’ve gained from the service.

Many organisations across the country are experiencing a similar dissatisfaction around the value of their cloud investments.

A wave of digital transformation spurred by the pandemic saw a mass migration to the cloud as organisations sought to rapidly modernise their applications and platforms to become true cloud-first operations. Those who did this the right way will have reaped the benefits in terms of cost savings, but now need to turn their attention to managing and maintaining their cloud environment to ensure ongoing cost effectiveness. Those who rushed their move to the cloud — taking a simple ‘lift and shift’ approach with no longer-term plan in place for optimising storage and infrastructure, managing and extracting value from data through analytics, and implementing performance improvements and automation — now have a difficult and potentially costly road ahead.

Mark Tile standing in front of bridge and a cityscape backdrop
Datacom Director of Strategy and Solutions Mark Hile says scrutinising your monthly resource needs, optimising your usage and taking advantage of the opportunities cloud offers is vital to squeezing the value out of cloud investments.

The consumption-based pricing model of the public cloud providers sounds great because you only pay for what you use. But unless you scrutinise your monthly resource needs, optimise your usage and take advantage of the opportunities cloud offers, you can end up paying much more than you anticipated — without yielding much return.

The cloud is more than a destination

In fact, we’ve come across several businesses that have shifted applications and workloads back out of the cloud due to concern over the hefty cost of accessing computer processing and data storage capacity.

So, if cloud holds so much promise, where is it all going wrong? Too many organisations have treated the cloud as a destination, failing to account for the ongoing management required to achieve the cost savings and financial visibility that the cloud can definitely deliver when properly optimised.

With businesses tightening budgets ahead of what is anticipated to be an even tougher year economically, you literally can’t afford to let your cloud-related costs get out of control. That’s why we are seeing the rise of ‘FinOps’ or cloud financial operations. It lets you gain the maximum business value from using the cloud by making data-driven spending decisions.

FinOps is becoming central to how we help our customers use Datacom’s own private cloud platform, as well as the big three public cloud providers – AWS, Google Cloud Platform and Microsoft Azure.

Central to this is application lifecycle management, a series of tools and processes that ensures you are accessing the most appropriate software licences, service plans and warranties. It considers things like virtual machine utilisation, data storage levels, and even individual transaction costs, to allow for ongoing optimisation.

FinOps draws on insights from numerous parts of your organisation to make sure you are really getting strategic value from your cloud spending. FinOps is high on the agenda of many of the major cloud conferences around the world, and the ‘hyperscale’ cloud providers are also ramping up their efforts to help customers better manage their cloud usage.

Security too important to go it alone

Going hand in hand with FinOps, is a renewed focus on cybersecurity. New legislation will soon see hefty fines slapped on organisations responsible for serious data breaches, part of a suite of measures the Australian Government is introducing with its new cybersecurity strategy.

The hyperscale providers are spending billions on cybersecurity to not only keep their own platforms secure, but to support the transformation of legacy platforms that are prone to attacks and security exploits. The security available in the cloud means that it is increasingly unaffordable for most organisations to “go it alone” when it comes to cybersecurity.

With the relentless volume of zero-day exploits, managing and mitigating these vulnerabilities remains an ongoing challenge for IT leaders. Leveraging shared responsibility models from cloud providers can minimise the attack surface internal IT teams are responsible for, therefore reducing the effort required under these scenarios. This can be further reduced as more cloud native services are leveraged.

But as with FinOps, extensive planning is key. For instance, the rise of ransomware attacks necessitates the need for modern and comprehensive data backup strategies, including provision for offline or immutable backups that can’t be impacted by evolving security threats. It also requires a more robust approach to data access and classification standards, identity management platforms and disaster recovery planning.

In the face of growing economic pressures, now is the time to build a more solid foundation for your organisation, controlling IT-related costs and mitigating security risks so that you can take advantage of cloud services capable of adding substantial value to your business, such as machine learning, data analytics and business process automation.

While the year ahead will throw its fair share of challenges at us, through smart use of technology we have an opportunity to get the fundamentals right and prepare ourselves for economic headwinds in the process.

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Public sector
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Cloud services Security