ROI in the Cloud: why is it a relevant indicator?
There are many studies on the Cloud and the attitude of companies towards their digital transition. Each of these studies presents us with figures that are more or less contradictory to our vision of the Cloud and our perception of the world. In this flow of data and conclusions, each more definitive than the next, a study conducted by ISACA (How enterprises are calculating Cloud ROI?) nevertheless caught our attention.
In this survey, ISACA informs us that, according to more and more IT professionals, ROI is no longer necessarily a relevant indicator in the success of a Cloud migration. To support this, several figures attract our attention: 32% of the companies surveyed do not integrate ROI into their Cloud strategy and 23% implement purely qualitative approaches (evolution of working methods, agility, fluidity of the user experience)...
Why do companies abandon the ROI?
Why should ROI no longer be integrated into the Cloud strategy of many companies? Behind this progressive lack of interest on the part of IT professionals, is it not rather possible to identify a lack of control over costs and a kind of impotence? Wouldn't these professionals be tired of struggling to understand their Cloud expenses?
Cloud expense management is a real challenge for many companies. For several reasons:
- A real lack of visibility on Cloud billing data
- The difficulties of centralizing multi-cloud data
- The lack of expertise of some teams in financial optimization of Cloud resources
These many difficulties in managing Cloud invoices are leading companies to put ROI at the back of their strategy. In favour of other indicators, which are more qualitative, but paradoxically difficult to quantify. Because if a positive ROI is difficult to obtain during a migration to the Cloud, it nevertheless remains a precise and quantifiable indicator. The agility of the team, the efficiency of the collaborators, the accessibility or fluidity of the experience are all interesting qualitative data, relevant, but difficult to quantify.
A mixed approach is therefore to be preferred. The Cloud allows many transformations in the company, which must be taken into consideration. But the implementation of a new Cloud strategy cannot be achieved without a clear financial vision and concrete targets.
How to better manage your Cloud expenses?
"But if the trend is towards a declining ROIist vision, why should I include this indicator in my strategy? ». We see you coming and you're right. It always seems difficult to escape global trends without perceiving risks for your company and your team. We have several ways to better guide you in managing your Cloud expenses, and therefore in accepting a ROIist vision of the Cloud.
- Improve visibility into your expenses to better understand your Cloud
In many cases, the lack of understanding of Cloud billing leads to a sense of helplessness. In an era of multi-cloud and multiple suppliers, many companies are struggling to identify their spending items in a clear and orderly manner. Add to that the cost of data transfers and the multiple "hidden costs", and you will understand how difficult it is to get a 360° view of your cloud billing data.
It is therefore necessary, to better manage your Cloud budget, to have all the maps in hand to be able to analyze in a simple and precise way your expenditure items.
- Establish a daily control
Once your information centralization tools are in place, analysis and control are smooth and simplified. The visibility provided on the many grey areas of the Cloud budget allows you to remain in permanent control, without fear of unpleasant surprises. Don't be afraid to check your Cloud invoices: it is now possible to anticipate before it is too late.
- Stay in control of your Cloud
The visibility and regular analysis of your Cloud expenses will allow you to keep control over your Cloud resources. Based on this centralized data and your accurate analysis, it is then possible for you and your team to proactively optimize your Cloud.
All the optimizations you make will allow you, over time, to aim for a positive and real return on investment. Your strategy for migrating to the Cloud cannot therefore be built without a medium- to long-term financial vision.
To set up this type of rather heavy process, we offer you a simple solution adapted to all your needs. Our Cloud Spend Management platform allows you to centralize all your multi-cloud data, set up regular monitoring of your resources, and provide you with detailed optimization reports to better control your spending.
For more information, visit our website or contact our sales team.
FinOps: the Swiss Army knife of the Cloud
To take control of tools like ours (although it is accessible to everyone) and ensure daily monitoring of Cloud expenses, many companies opt for the creation of a new position: FinOps. Some groups even set up real teams to support cloud invoice optimization.
This versatile profile is a real lethal weapon in the fight against overbilling. As an expert in the Cloud, its products and specificities, but also as a seasoned financial expert, he plays a strategic role. His mission: to ensure that Cloud budgets are respected and that supplier invoices are no longer synonymous with unpleasant surprises. Like a chameleon, he is therefore able to make the link between DevOps teams, in the heart of the Cloud, and administrative teams, who are looking for a quick return on investment.
ROI: a relevant and essential indicator
If so many companies are deciding to no longer consider their investment in the cloud as a profitable investment, it may be because they do not have the right tools to implement their strategy over the long term. It obviously seems difficult to migrate to the Cloud without being able to think that the investment will allow the company to benefit financially in the medium term.
This is why we believe that ROI on investment is a relevant indicator, if not mandatory in the success of a migration to the Cloud.
