AWS re:Invent 2017: Building a Solid Business Case for Cloud Migration (ENT203)

all right so everybody's in love with business cases as much as we are awesome okay my name is Rohan Croce I lead the AWS professional services practice in Canada and this is my colleague my name is Shabazz Alam I lead our professional services practice for AWS for a majority of Europe we're very excited for all of you to come here you know it's early in the morning you figure that we try to help you out a little bit so if I can if you can just humor me so if this third of the room if you can just stretch your arms out just stretch your arms out come on come on just try your stretch there you go stretch stretch all right this this this little thing in the middle right just tight tight bring it very very close tight close close close your arms close you're stretching no you guys stop stretching stretch clothes you guys just a little bit right just move your arms around as much as you can all right you got you got them close you got them over perfect so our better halves didn't think we can get around it applause from all of you so we figured we just mock it up that's it now we're gonna post that we got this right hands applause so thank you so so it just as a show of hands how many of you are from the business side are in finance and operations ok good portion of you and how many of you are sort of deep technical engineer or software developers ok about half the room and then how many of you are faking it that you know IT ok that's at least you admit it so thank you very much for coming we we did this session last year and as we've as we've seen throughout the year we're disruption is around us when you look at how the market is moving in tickets and television but over the top think about how banks are moving with all these new multiple banking platforms thinking about mortgage lending right disruption is around us and if you stay still and if you have already been in the space and you're not doing anything to advance then you're going to feel the part feel the pain so what we really wanted to do was to go ahead and think of a better way to define how to build a business case we did this last year we had a similar session we received very positive feedback and throughout the year we've been actually doing a number of different business cases and we've been learning and refining our methods and practices along the way and so we we really want to go ahead and try to share some of our learnings and experience with you so as we well as we go through the session what we want to do is to review whether the key components for a business case talk about some of the tools and frameworks we use internally and how we work with our different customers and they give you some examples on what this really means so if we think about a real-life business case we worked with a financial services customer and we started mapping out what is their total cost of ownership and we realized that AWS was about 34% cheaper and then we took it a step further and we looked to say okay if they were to really optimize their technology then they can get savings of over 60% and their dev and test environment and if you take it even further and you think about how moving to cloud or change them they'd be able to have a more flexible operating model which would be able to give them some more benefits as well and then finally if you went through and looked at the impact they'd be able to have more of a productivity improvement of over 25 percent so all of these things combined and we'll go through each one of these case-by-case as to how you can use this and billing out your own business cases right so I mean the first thing just to really understand is right this it's not very difficult you just have to be diligent you have to be focused and you have to be able to try to make sure that all the key components are included right more often than not what we see is when Pete when our customers and try to create business cases they focus too much on one area and the other and really you want to look at all of these four things so first of all how many different types of business cases are there we really think it's about three hey so the first one is a high-level business case this is really directional in nature you need to come up with an estimate to see whether or not this might make sense right it's really just to give the idea whether or not any whether your team should go ahead and pursue this activity the second one is a more refined business case and with the refined business case it's you know gives you some more detail you're trying to understand how your people might impact things how some of the design or for your technologies may be impacted that you're going to get a few more data points and through that you're going to get a higher level of confidence that the that the that the answer that you come up with that the analysis that you do has more detail within it and if you really need to go a level deeper then you can have a very detailed business case all right which is a deep dive of every single point you're trying to look at what are your cost what is your structure you're trying to look at where are your going to be able to get some savings where you can get more efficiency more productivity from moving over to cloud and and this gets you really into into the 95% accuracy range right and as you can imagine as you go from a high level to refine to a detail each one takes longer it takes more time right the high level you can get done fairly quickly whereas a detail involves you know quite a bit of effort and time from not just you know one person or one team but multiple areas of being able to give input so when we had a table us thick talk to our customers and we try to help them think about where it is that they are in their cloud journey we really you know look at what we call our stages of adoption so we have about four stages of adoption of the project stage foundational cloud native and then reinvention and the project's age is basically you're toying with the idea you're doing a couple of pocs you're you're testing out one or two workloads it's it's really an experimentation at the at the foundation stage this is really where you're trying to build out your key foundations for AWS environment so you've defined a strategy for your account structure and your VPC structure to define your networking strategy your security strategy really the baseline for all of your AWS for your AWS environments and then there's a migration phase which is when you're trying to actually move your workloads from your on-premise to AWS and the migration can happen in multiple ways how many of you are familiar with the six RS some of you so there's a few different presentations that will go deeper into it but it really talks about six real ways that you can migrate over and you can Rijos them which is basically more of a lift and shift or you can go ahead and and you know reap lat for more we architected so on and then once you've actually migrated to cloud you have to think about do you want to reaaargh to re-engineer some of your applications because when you lift and shift applications over you may not take on the full benefits of cloud you'll get some of these impacts but you won't really is if you have a large monolithic application that you moved over as is you probably will not be able to get the benefits of auto scaling but you probably won't be able to get the benefits of being able to turn things down and up as you need it so when you look at these four stages of adoption my project foundation migration where is the right place to go build a business case well from our standpoint you can build a business case here at the project stage to see whether or not you know based upon your experimentation if it's a good idea you can build it at the foundation level now you've understood AWS further you can go ahead and have a little bit more detail you can go ahead and build it even at the migration stage or all the way at the top right at the optimization stage so you really want to make sure depending on what your need is you can define your business case as needed so the inputs that you put into each one are going to different the level of understanding that you have about the platform and about the different areas are going to be different but all of them will serve a purpose and you really have to understand and talk amongst yourselves and and your peers as to what you're really looking to gather from all of this so if you look at the process of building out of business case the very first piece is to use a TCO as a baseline so TCO is a total cost of ownership which is essentially the acquisition cost the migration cost as well as the operations cost you want to be able so what is a total cost of actually owning and operating a an IT workload or an IT environment or your data center however you want to define that scope to be and there's a few things that go into a TCO so if you're trying to compare what what you have on Prem to AWS you're going to look at your server costs and your server costs include things like hardware your racks or chassis it's also going to include your software such as your operating system any virtualization licenses you may have and such next you're gonna look at your storage costs which include everything from your Hardware right such as your nas your sand etc but then also the software cost of what how are you going to do your backups and admin and then on top of that you're going to look at your networking costs which again includes the physical pieces such as your switch is your load balancers your your bandwidth cost etc as well as sort of your software piece eight how are you going to monitor your network and then there's a set of cost here that most of our customers tend to leave out either by choice or just they don't think about it and can anyone sort of guess what these types of costs are I sorry said again security costs yes people costs data center yep power yep so facility cost right space power or cooling in most cases this is basically a black box most product managers most software team don't most business unit heads but you don't really get that detailed cost analysis your base you just given I pay my monthly fee or my yearly fee as a line-item to IT but you don't understand how much of how much power your specific server is taking up how much actual space in how much real estate space is your your VM the hypervisor and where ESX server sense is actually taking up so you have to take that into account because when you compare it to the AWS cost that includes all of it we I mean the the hourly cost that you pay for an ec2 instance on AWS or for any of our services includes the cost it takes us to operate those services on your behalf so if you want to have a true analysis you have to make sure you include these sets of costs now if you think about migrations now you also have to think about what is your migration cost because well it's not going to move itself so this includes people tools so you're going to maybe involve some third-party tools such as discovery tools migration tools and such and you're going to have people cost whether those caught those people costs are your own internal teams or they're third parties that you hire and on top of that you also have to think about will you have any lease penalties and if you have a Colo do you have to stay in there for a certain period of time and then you have to think about your labor costs so and this is your own internal labor cost so how do you go ahead and operate your environment today around your server admins your VM admins your storage admins or networking teams right the who are the people who are running and operating your data center or your support teams etc so it's really it's really something you have to make sure you you understand and fully encompass as you go forth and and try to build out your business case now the last piece are you're going to have some extras that you haven't thought about like project planning you may have to think about hiring a project manager you may have to think about hiring some outside help are you going how are you going to train your teams one should move over to AWS what about your cost of capital so there's a number of these things that you people forget about to include because moving to AWS you don't want to always show all the great things there are pieces that you have to invest to be able to get out the return though next is you have to think about technology optimization a technology optimization really comes in the form of when you're trying to compare your costs you don't want to make it a like-for-like you're not moving to AWS to make your environment look exactly how it is today then you just have another place to host your your your workloads and the benefits and such are not going to be as great what you really want to do is compare it to what a reaaahhr tected environment looks like on AWS and this reaaargh affected environment think about a world where you're free from managing infrastructure you don't have to think about how to manage a server you don't have to think about do I have to backup this this in this workload do I have to make sure that I'm monitoring this server in case it goes down how do I send an alert at 3 o'clock in the morning I'd think about how you can go about doing that and we're thinking about how to maximize and optimize the technical technology side there's five main pillars that we really think through and these include services so of course at the very base line you can have an easy-to instance which is basically a computing TSA's but you can have managed services or even higher value servers higher value services include things like lambda managed services include things like RDS and redshift the second pillar is really about fit so are you picking the right instance type are you picking the right instance family are you picking the right storage type are you picking the right storage class when do I use something like EBS versus EFS versus s3 vs. glacier if I'm using s3 right am I going to go ahead and use s3 or s3 ia what's the best thing my workload what's the right fit for what I need to do do I need to have a lot of puts and gets is that okay or do I need to have block-level writing it do I need is my workload computer optimized or memory optimized even if you're thinking about things like RDS you can go ahead and pick different different families of RDS instances the third areas around price so there's as many of you know there are multiple purchasing options around AWS so you have your on-demand hourly pricing you can do reserved instances you can do spot you can do dedicated but then also you have to think about the licensing options as well around the software are you going to use existing licenses that you have and bring them over are you going to switch over from license focus to areas that don't require a lot of licensing are you going to use something like a marketplace to go ahead and get your licenses are you going to move from databases that are through the large corporations into something like Aurora so licensing is a key factor that you have to consider into your cost next piece of scale so one of the key benefits of moving to cloud is the ability to auto scale and you can scale based upon time or event by time it means that at 11 o'clock every day I'm going to expand or I'm going to decrease and I know it at 6 o'clock in the evening when everyone leaves I can go ahead and shut things down so as you go ahead and build your business model you have to make sure and take these into account so as we talked about in the previous business case that they've received they saw a reduction in their dev and test environment the reason why there was a reduction is that they calculated out that in the evenings and on weekends they wouldn't run they did not have a 24/7 development shop they knew when those when those workloads would have to turn off and so they accounted for that so that's the same piece if you don't have the ability to shut down your operations today and be able to bring them back up in an automated fashion but you will tomorrow that actually is a positive impact on your business case and the last pieces around iteration so once you go ahead and come up with these baseline scenarios you want to be able to do some periodic reviews and update your numbers because you'll learn things do you realize that maybe I picked in an EM instance class family and then I realized I really need an R instance class all right it's not general it's really a memory heavy or I really need GPU and type instances so you you will have to refine what makes sense for your workloads and that's one of the beauties about AWS experimentation though you can do it and it doesn't cost you much so you have to think about how you want to go ahead and structure this and how you want to optimize your technology so you really want to make sure that your technology optimization allows you to simplify the underlying stock so if you're just looking at compute which is basically easy to hey you're you're looking at paying for real estate right facilities power you're looking at draw on premise piece these are all the different areas that you're going to be accounted for now when you move over to the Foundation's piece as we talked about now you're gonna see use ec2 and use things for like s3 and EBS or potentially EFS for storage but what if you took it a step further what if you started using serverless things like lambda API gateway batch these things can go ahead these services at AWS offers Athena can go ahead and make your value so much greater because now you're focused on only your workload and your application a Tobias is taking care of all the underlying aspects and as we go through all of these you also have to think about where it is that you and your teams can add the most value because if you feel like the value is added by managing and maintaining your data centers then that's what your core competency should be but if your value and core competency is somewhere else and you leave that to - AWS to do we've talked about TCO we've talked about technology optimization now we want to think about the impact of transformation and the impact of transformation as things that you don't normally think about as you're thinking of a migration of the cloud and here are some of the things that come to mind here are some of the things that our customers tell us about you know are how are you going to do governance and policy management in the cloud do you have an Operations process you have an operations management are you going to do reporting I need any differently what's your what's your core competency going to be now when it's not servers and racking and stacking I recently was working with one customer and they told us that today they have three different teams that get involved in sizing a server okay that's going to be fundamentally different in in in a cloud world how do you account for that cost how do you account for that transformation something need to think about now you're going to have to do some legacy legacy modernization I'm going to talk about that a bit more in a minute what about DevOps how many people have heard DevOps here what does that mean right it's it's really loaded it's it's a really big concept but the concept of doing for example waterfall development in a cloud world doesn't really work I recently was talking to one CIO and she told me that the transition to agile was one of the most tough things she did in her career does that resonate with anybody it does I see some people shaking their head so absolutely so how do you account for that cost how is your organization going to transform because they can't be doing the same thing they're doing if you're going to optimize and really get the best out of the cloud think about these sort of non technology components and many many of our customers get hung up on this because they'll go back and they'll look at the business case and when they hadn't accounted for these components now in the in the end state the business case doesn't look as attractive and someone says well this cloud journey wasn't as hyped up as I thought it was going to be so what we're trying to tell you is think of these components up front and the good news is we've come up with a framework for this has anybody heard about the cloud adoption framework a few people not as many as I would have liked so AWS has put together this cloud adoption framework that is really meant to be you know this agnostic framework for helping customers allow along their cloud journey and really what we've done here is take each of those components and help you think about which of those components are relevant for your business case ok so the six there's six what we call perspectives and each of those perspectives has an impact on what what you should be considering for your business case let's take the business perspective for example okay so one of the key things we talked about when we doing the business perspective of the CAF is why are you doing this journey to the cloud okay so most companies already have an existing IT strategy so now they have to realign their IT strategy to encompass cloud okay there's a cost to that there's some there's some realignment required for instance if now all net new development is going to happen in the cloud what is that going to look like do you need a separate team for that do you have those costs factored in into your IT organization how do you manage vendors now in the cloud they're going to look significantly different than they did in your traditional IT in many cases this cost savings there okay so you have to factor that back into your business case because then your business case will look more attractive servoz and I actually were meeting a customer earlier earlier this week and my customer basically said well you know what I've done all the numbers and my private cloud really is cheaper than the cloud okay so does anybody really believe that here well we don't partly because there's cost that they haven't captured there's cost they haven't put together which means that your business cases are not being compared apples to apples okay how do you count for IT organizations that are already using the cloud in many businesses we see there really is a line of business that already has an application on AWS or in a cloud okay so how do you bring that back into into IT or control or maybe you let them continue as they are so those transformation costs those traction impacts needs to be included the second thing we want to think about is the the cost of people okay how you train how you what you train who you train is really really important and those costs are typically not captured in a business case they really thought about after the fact or the not accounted for at all okay and the concept of a cloud co e right there's not one model there because we work with a lot of organizations and you know there's not necessarily but sometimes there is there is of this this model that needs to be built that takes time and effort and cost you might need some external consultant to help you build that - when we think about training there's many things you need to think about one of the things we tell customers is train often train early and keep training and who do you train right you can train one group of people or you can train everybody I recently was talking to another CIO and and my advice to him was you know what don't build a separate cloud team that is the only team that gets taught that learns AWS train everyone train everyone that way you note that momentum within the organization and then really you know your cloud migration can be accelerated once again that's a cost that a lot of organizations don't think about there's a different cost of governance okay a lot of companies have built a lot of controls a lot of structure around I told does that sound familiar right everything has been idolized release management change management incident management problem management I know I built a lot of that myself now how do you do it in the cloud right do you overlap the existing process on the cloud I recently was talking to another customer and they wanted the developers to fill out a paper form to turn on any STIs to instance this is kind of funny but true it's true story because all they're trying to do is overlay an existing process on to sort of a cloud process so what what's what's happening to happen here is process need to be we engineered there's a cost to that if you don't build if you don't build it in if you don't think about it you're not going to be able to sort of be efficient down the line how is AWS consumed right do you need to get tools in front of place because as much as we have really cool native tools sometimes they may not fit with it with an organization with an enterprise whether it's a Service Catalog where there's tools like ServiceNow right they need to be sort of built in into how the tools into how the migration will happen and how you will consume your organizational consume cloud how do you manage capacity it's fundamentally very different in AWS than in than in on premise we have this concept of now you need to think of your servers as cattle not pets does anybody hear this before ok so think of how you manage that capacity it's very different and how do you manage assets ok the traditional model of a CMDB may not necessarily so how is that sort of when we think about all the elements I've described here these are all these are all impacts to your transformation that you need to account for I need to think of and your migration plan and your migration business case needs to have all these thought of and what we've shared here is not necessarily the be-all and the end-all it's not meant to be the only comprehensive list but it's a bunch of things that you need to be thinking about and at least some that we encounter when we're out on the field so then we think so I've talked about three perspectives there on the left side which is the business which is people governance now let's talk a bit about the other technical perspective which is the platform security and operations and when we think about the platform and we talk about this in a minute again is some of your legacy environment will have to be modernized ok some some of those applications like Shabazz was referring to earlier cannot necessarily be lifted and shifted into the cloud right so as much as you have the tools to be able to optimize that environment right there's an actual cost to go ahead and do that and have you accounted for that cost in your business case and how do you in certain cases some of those applications may need to be refactored and refactoring you know there's a bunch of methodologies around to do that there's a cost applied to that can you do it yourself you have the skills in-house to do that are you going to be hiring somebody to do that how long is it going to take which ones do you do so that needs to be accounted for as well in certain cases some of those applications were just not meant for the cloud they need to be reor connected there's a cost of that too okay and then we we spent a lot of time with customers once again that have invested a lot of time and energy and and investments in in tools so you know good tools for monitoring good tools for ticketing logging auditing so those tools need to be integrated with AWS tools in certain cases you may choose a native tools we actually have customers that say you know what we're not going to use our old tools anymore we're just going to use the native tools so now there's a cost to that right there's a cost to either not using that existing tool how do you depreciate it make sure that's a counter for the business case and then the operations how are you going to operate this is your existing team going to do it are you going to use a managed service provider almost every business case I look at doesn't include enough costs for post operations okay the almost there's no such line item in any very few of the business cases I see that says is there a cost to operating this managed service providers or even if it's existing internal IT how they going to do it what is the cost are they trained up or existing partners sometimes who are supporting your data center they are they they will be able to support your existing future AWS into landscape but babe haven't been along for the journey so they were just gonna give you a bill at the end and say well now this is how much it's gonna cost to me to support that okay that that's also a surprise so each of these needs to be thought of now as we were sort of building this one of the things we came across is if you don't do anything right and and your business case once again like I said if I give you the scenario of you know the customer that's comparing my private cloud to AWS right you're really comparing very basics very basic sort of compute and like Shabazz said it's literally the first slide we talked about but what you're not accounting for in that existing business case is what we call the cost of inaction okay what we say the cost of inaction should be factored into your current state okay because you're going to spend that amount of money regardless what do you go to the cloud or not you're going to spend money so how we've done this and have you think about this as do this walk do this comparison to get you to build a better business case and we kind of did this in Reverse so this is kind of like you know going back in time in an end-state there's a true AWS spend your beautiful business case has been developed you've done all the the the migration costs you've built all the people cost impact technology transformation you've really got a dollar amount for what your AWS future states going to look like you need to be able to compare that to on-premise in your existing environment you're going to spend a certain dollar amount on application organization regardless or whether you move to cloud or not does anybody disagree with that does anybody agree with that actually some people shaking their heads absolutely so whether you move to cloud or not you're gonna spend some money on application organization you just have to keep current it's a bottom line you have to factor that in to your existing business to existing standard cost of operations almost nobody does that so what does it do it shows your current operating costs as being pretty low which is really wrong another one is you're going to do hardware refresh okay you're not going to necessary model okay we've seen so many of that so many of those standard operating business cases that don't have a hardware refresh included in that okay because you think you're gonna have to run that hardware for a next period of time but if you're comparing it to a five-year AWS business case there's at least one hardware refresh in there that is typically not built-in so build that into a current comparison you're gonna do gonna have software licensing okay and the software get cheaper over time it's not right it doesn't IDB yes okay so you have to think of your existing run rate of software licensing and maintenance and shahboz actually made me take out a line here yesterday because I had software audits in here who loves that right sometimes that's a cost that you haven't even contemplated that you could get hit with so that's a standard operating cost that is in your existing baseline you should account for it and then you've got what we call best-of-breed integration okay and I've built data centers of managed data centers and this is what best will be integration means this means that in your operating system in your application layer in your database layer in your network in your monitoring how many different software's do you have dozens right across that layer there's dozens of different software's how much time do you spent making them talk how much money and and those boxes are not meant to be accurate they're meant to be relative not even relative right that could be a significant amount of your operation that there's no line item in the IT budget for it okay you have to account for that so then at the end of the day if you if we build all that up there's a total cost of what we call in action of not migrating to the cloud that is apps you not accounted for anywhere okay because your standard business case like Shabazz had put up just include servers Hardware you know some software some facilities costs if you remember and that's what your current comparison is against so when you do a standard TCO comparison you know we're looking at about 25% savings which doesn't include any of this okay so really really what we're trying to say here is if you're going to build a small business case for migration you have to think about the transformation impact then you have to think about these elements of what we are calling the cost of inaction and once again this probably more we could have probably added seven or eight more here of what it cost you standard environments you guys know a lot of that better than many of us do in certain cases is compliance lead depending on the industry or in that you have to keep updating imagine the cloud provider does all that for you and you're not doing that okay so we've talked about TCO we've talked about technology optimization we've talked about transformation impact the last we want to talk about is what we are calling business value okay and the beauty of business value here is that now what we found is ways and methods for you to be able to quantify the benefits of AWS that go way beyond a traditional business okay and this is one in one example we have here is understand how IT cannot help the business in a cloud model as opposed to before right Gartner has these stats that say traditional IT organizations spend over 70% on keeping the lights on right only 30% is dedicated of your budget to innovation and to new projects does that resonate with anybody right mostly money spent on keeping the lights on right but now if you're in a cloud model what do you have a lot of time to do you're gonna have the same IT staff they have a lot of time on their hands now right instead you can consider our new business initiatives you can consider new projects right you can dedicate more resources to innovation does that sound something that's possible and doable absolutely right but what we've been able to do and give you some thoughts around is how you can actually quantify that because that is what you want to build into your business case to make your business case even stronger so your business case goes beyond just a bunch of how I can save money on hardware and software but now how I can actually impact the business how I can add value to the business okay so we want you to think about that in sort of two ways right one is obviously the tangible cost savings and we'll show you some examples of that but then the more trickier one and the one that actually had a lot of fun in the last year or so is around quantifying the business value for intangible items okay and what are those intangible items right and wreathing tangible ones are the ones that you know are a little bit more difficult to quantify but really are impacting both your top-line and your bottom line okay so let's start off by talking about the tangible benefits and these ones will make sense to everybody here because these are the logical ones that stick out the first one it's cost avoidance so moving to the and you have to once again what we're trying to say here is you have to be able to build these into your business case have a line item that says cost avoidance okay imagine how excited your CFO is going to get when he sees that okay so one example of cost avoidance is in the second line of your in your AWS side of the case you're going to be able to eliminate hardware refresh programs remember the the cost of inaction we had on the other side that said harder refresh well you're not gonna have one on the AWS on the cloud side okay reduce forcus uncertainty by matching supply with actually demand that's that's sort of a pocket statement but what we're trying to say there is with the technology that AWS provides you have the ability to scale up and scale down for those projects that before everything was a capital expands or everything was uncertain and that was an added expense to the IT and take an exact take start off by looking at what you spent on projects within your current year which of that was expected which if it's one expected and uncertainty on demand when you have peaks and valleys peaks and valleys of your business what do businesses do they're built for the peak in the mean time all that is unused capacity so you be so what all you're doing is avoiding that cost of that peak you have to be able to quantify that pathway to optionality what does that mean what that means is with an open system like AWS when the open services you can pick and choose the services you need right when you're when you're buying from another vendor you're buying a bunch of things that you probably will never use okay who's paying for that you are okay with the cloud options the cost avoidance yours you're going to only pay for the features you use okay look at your balance sheet from last year and say here all the things I paid for here the ones I actually used you're not gonna pay for that that's cost avoidance okay the second part is operational cost potential benefits of operational cost we can you can save money through automation right you're gonna save my lat you're gonna spend less on tools for patching right you don't have administrators out there I remember the days of actually setting out people with CDs and disks to go do OS patching okay you don't have to do that anymore right in additional compliance costs that you may have to hire someone to do audits right you have now access to the platform that has that built in so you were so you're saving on those operational costs hardware maintenance costs they're just no longer there right and you should show line item on your business business case that says cloud hardware expense hardware maintenance zero sure it all the way through I'd love to see that okay and then at the end the day the transparency driving a leaner means mindset right your consumption model you're able to show show back very clearly what the bill was to the you end-user right how many much have spent time building charge rack models put up a show of hands how much fun is it it's horrendous okay now we're tagging the technology you can show that Trent that that use so transparently that the business user actually can say okay I really do spend that much or spend this little right that's gonna drive down costs okay so don't forget what that looks like so we've talked about the tangible benefits now let's think about the intangible benefits okay business agility you'll hear this throughout the week over and over again how the clouds gonna help you be more agile right wrap in and less expensive experimentation who remembers the times of when if you wanted to do a POC you'd have to go buy expensive hardware and you have to buy a license you'd have to get a project funding just to do a project I mean out to go anywhere okay there's there's a bottom line impact agility that you can quantify fast rapid efficient application development we've actually worked with one large enterprise that quantified in their business case 50% developer productivity improvement because the tools they had available to them in the cloud where does that get quantified that goes right to the top line okay to the top line in that those developers are now creating 2x products that the customers are going to use now I'm not saying it a bus is gonna make you twice as rich but the point is your developers are more productive you can find a way to quantify that okay faster time-to-market if you're able to make faster products productivity for the workforce is the other element that we wanted to talk about now your team is much more productive they're not waiting for service to get turned up right you can quantify that I did one business case with a with with a financial services institution that said okay here's how long it takes us for project from start to finish okay the quantify the time and time is money you can quantify that time to dollars then you shrink that and guess what operational expenses down productivity is up okay increased automation there's a self-service culture now okay how much more productive is your team and your workforce when they're able to be more productive high retention we're actually talking to customers that are saying we we've been able to retain our staff more if they're working on projects in the cloud find a way to quantify that in your business case right because how expensive is it to go out and rehire people again right put a line item that says I'm gonna save money on rehiring okay resilience you can actually document how much more resilient and available and higher availability the cloud has versus traditional systems okay many companies and organizations are able to quantify the dollar amount on revenue of a minute or an hour of downtime does that make sense if you're depending on the business you're in an hour or a minute of downtown of your IT systems Inc equals lost revenue okay if you're able to say now I have X amount higher availability because of the systems of architected on multi-building zones resiliency of the cloud I can quantify that as increased bottom line or top line okay reduced bug so this one is one that Amazon itself sort of lives and breeds right our CI CD sort continuous integration because development methodology means in an in a year we're actually releasing 50 million changes on amazon.com right like the numbers are mind-blowing it's all relevant it's all relative depending on the organization you're in but you're able to iterate faster talked about the whole DevOps culture versus agile right less bugs and what do bugs what are bugs they're not free they cost money okay how much does it cost to fix something that was developed wrong in production and our traditional on-premise system okay pick one example you have you have the data in front of you pick one example put a dollar amount to it right that's all that comprehensiveness can get built into that business case where this is a great thing for you to sort of think about is at the end the day right how you continue to enhance business value and the whole concept of experimentation and experimenting frequently is the whole AWS value lower the cost of ink if you want to increase innovation if you want to increase innovation lower the cost of experimentation right developers have access to a set of primitives based on everything you've helped them built built or consumed they can go out and turn on products and services and develop and if it doesn't work shut it down right what's the cost of that right you typically have accounted for that cost in your IT organizations you are paying for it okay you're paying for eight months of that project that it took to build those servers higher than rack them by the software and that project for net to get launched how many of those do we have on an average 15% of IT projects are actually successful okay are you accounting for that 75% failure because there's a huge cost to that guess what it's hidden in your IT budget put a cost to it right and show that you're still probably going to have that type of nobody's saying that you're gonna get 30% more success of your projects on on AWS but the cost of those experiments is much lower okay quantify that put a dollar amount to it and here's an example right we want to share this and say at the end of day you know in a tradition environment how does this work all these are gates for developers builders want to build they don't want to be blocked they want to innovate how easy is it for them to do this today okay they have an idea they have six gates before they get through someone's supporting them and the ones who push through will push through because they have the the fortitude and sort of the motivation determination right they'll get told we're too busy this year do it next year oh you really want to do that that's a change order someone's gonna charge more for that or when it's put in production well you're gonna have to support of yourself we don't do that right so all those things plus the previous slide I said quantify that put a dollar amount to what those cost of experiments mean to you okay so at the end of day when we think about your entire business case and the four things we've talked about the tape right the right business case enables you to do a few things the first one is correctly define your current and future costs so some of the things I've described today are really your future costs regardless of which way you're operating whether you move into a calm model or not you're still gonna have to modernize when you think about moving to the cloud you're going to have to put the cost of your trends your transformation in there don't forget it because it doesn't custom come for free it will it will be something you have to spend money on so in that case we're telling you the cloud case becomes a bit less attractive but put those costs in because at the end of the day someone's going to go back and ask you well you didn't include the cost of training build it in okay envision the Ardo possible lecture bob said think of the future state that doesn't look like your current state from a technology perspective okay you have the five pillars of technology optimization at your hand at your fingertips now right it will help you envision a much different future state so you're not lifting and shifting what your current products look like they might be refactoring there might be we architecture but you're you're envisioning a future state reflect the cloud transition the migration cost we talked about using the six perspectives of the caf right it might be a lot it might be more than you thought but at least it's accurate right and then finally we talked about both quantifying your tangible and intangible benefits and I hope we've given you some thoughts on both the tangible intangible benefits that you may not have thought of before it came in today especially the intangible benefits we find so many customers that sort of open their eyes and says wow I hadn't thought of that before right definitely something different another way to look at it and more and more refining business cases are really really need a lot of rigor they need a lot of sort of work upfront because you're comparing against environments that you know people know very well okay people have spent a lot of time building private clouds or data centers you know they're they're sort of motion attached to them and they know those costs very well okay there's a cost of transition we talked about the cost of transformation right you need to accurately reflect that right and sometimes and at the end the day what we see always is the business case is just one element of your transition journey it's just one element cost is one of the drivers but really really important for you to reflect the cost correctly and we hope we've given you enough things here today to think about and that this this session was valuable so thank you for your time it's been a pleasure you have [Applause]

Channel: Amazon Web Services

Views: 14,330

Keywords: AWS re:Invent 2017, Amazon, Qureshi, Enterprise, ENT203, AI, Migration

Id: CcspJkc7zqg

Length: 49min 57sec (2997 seconds)

Published: Tue Nov 28 2017