Building a Better Business Case for Migrating to Cloud

© 2019, Amazon Web Services, Inc. or its affiliates. All rights reserved.S U M M I T
Building a Better Business Case for
Migrating to Cloud
Shahbaz Alam
Senior Practice Manager
AWS Professional Services
B U S 0 0 4

Agenda
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On-premises Challenges
Inflexible physical assets Costs are rarely in sync
Migration and
expansion costs
are high
Cost of
unexpected
inefficiencies

Cloud Value Framework
Typical Focus is on Cost Savings, But Compelling Benefits Go Beyond Cost
Cost Savings
(TCO)
Staff
Productivity
Business
Agility
Operational
Resilience
Infrastructure cost
savings/avoidance
from moving to the
cloud
Efficiency
improvement by
function on a
task-by-task basis
Benefit of improving
SLAs and reducing
unplanned outages
Deploying new
features/ applications
faster and reducing
errors
Typical
Focus
Compelling Cloud
Benefits

Migration Focused Business Case
Cost Savings
(TCO)
Technology
Optimization
Organizational
Transformation
Inputs
Operational
Resilience
Business
Agility
Staff
Productivity
Outputs

Types of Business Cases
Directional Refined Detailed
Objective
• Provide directional estimates for
migrations to AWS based on high-
level inputs and assumptions.
• Make available, presentation
materials that are Board and CFO
friendly that a customer sponsor
can draw from to create their
business case.
• Provide a refined business case for
migrations to AWS based on more
refined inputs and assumptions.
materials and backing data that
are Board and CFO friendly that a
customer sponsor can draw from
to create their business case.
• Provide a detailed business case
setting out the case for migrations
to AWS based on detailed data
point discovery.
materials and backing data that
are Board and CFO friendly that a
customer sponsor can draw from
to create their business case.
Effort 1 – 2 days 3 – 5 weeks 6 – 10 weeks
Output High-level business case presentation
with data
Detailed multi-year business case. Detailed multi-year business case
Accuracy + / - 30% + / - 10% Highly accurate and precise

The Right Time to Build a Business Case
At any stage of adoption:
• Project
• Foundation
• Migration
• Reinvention
Develop any type of business case
and refine as needed throughout the
stages.
Here
Here
Here
Here

TCO = Acquisition + Migration + Operational Cost
Hardware – Server, Rack Chassis
PDUs, ToR Switches (+Maintenance)
Software - OS, Virtualization
Licenses
(+Maintenance)
Server Costs1
Facilities Cost
Space Power Cooling
Hardware – Storage Disks, SAN/FC
Switches
Software - BackupStorage Costs2
Facilities Cost
Space Power Cooling
Network Hardware – LAN Switches,
Load Balancer
Bandwidth costs
Software – Network MonitoringNetwork Costs3
Facilities Cost
Space Power Cooling
3rd Party tools – network discovery,
migration, storage, database
Labor costs – FTE, ConsultantsMigration Costs4
Duplicate Environment
Lease Penalties
IT Labor Costs5
Extras6
Server Admin, Virtualization Admin, Storage Admin, Network Admin, Support Team
Project Planning, Managed Services, Training, Legal, Cost of Capital

The First Rule of Technology Optimization
Compare your current on-premises environment to your future state re-
architected AWS environment, NOT a replica of what exists today.
≠

Imagine
A world free of managing infrastructure

5 Pillars of Technology Optimization
Fit Price Scale IterateServices
Purchasing Options
Licensing Options
Instance Type
Instance Family
Storage Type
Storage Class
Managed Services
Higher Value Services
Time Based
Event Based
Periodic Reviews
Periodic Updates

Simplify Your Technology Stack
Application
Operating System
Hypervisor
Storage
Servers
SAN
Networking
Power
Facilities
Real Estate
Application
EC2 (Servers)
S3 (Object Storage)
EBS (Block Storage)
Application
AWS Serverless
On-Premises
Cloud Foundations
Higher Value Services

Business Transformation
Business Transformation
• Realigning IT Strategy
• Vendor Management / Sourcing
Strategies
• Line of Business IT Realignment

People and Governance Transformation
People
• Cloud Competency Center
• Agile Development / DevOps
• AWS Training and Skills Development
Governance
• Standards and Controls
• AWS Consumption Model
• Financial Management
• Capacity Management
• Asset Management

Platform, Security, and Operations Transformation
Platform Evolution
• Legacy Modernization
• Application Refactoring
• Application Re-Architecture
Security Enhancements
• Security Tooling
• Security Policies and Controls
Integration with Existing Tools/Processes
• AWS Native Services
• Cloud Operating Model
• Cloud Operations

Cost of Inaction
Software
Licensing
Best of Breed
Integration
Hardware
Refresh
Application
Modernization
True AWS
Optimized
Total Cost of
Inaction
Cost

Migration focused business case
Cost Savings
(TCO)
Technology
Optimization
Organizational
Transformation
Inputs
Operational
Resilience
Business
Agility
Staff
Productivity
Outputs
• Improved system
performance
• Less downtime
• Improved security
posture
• More incremental
changes = reduced
bugs
• Individual task
productivity
• Self-service
culture
• Increased
automation
• Developer
satisfaction =
higher retention
• Rapid and less
expensive
experimentation
• Faster application
development
• Faster business
decisions = faster
time to market

Assessing Staff Productivity
Server Network
Storage
ApplicationFacilities Security
Infrastructure
Staff
Productivity

AWS Benchmark: Staff Productivity
Cloud improves efficiency… This value accelerates with AWS maturity
Increase in # of VMs
managed per admin
2x
Increase in # of TBs
managed per admin
1.8x
Increase in # of VMs
managed per admin
over time
3.3x
Increase in # of TB
managed per admin over
time
3.2x
Staff
Productivity

Measuring operational resilience
Category Definition
Third Parties Cost of third parties (contractors, consultants, specialists, etc.) engaged to help resolve unplanned outages
Equipment Cost of purchasing new equipment or repairing existing equipment
Ex-post activities After the fact incidental cost associated with business disruption
Recovery Activities and associated costs to bring the organization’s IT environment (network, servers, systems,
applications, etc.) back to a state of functioning
Analysis Activities associated to perform the initial discovery (and any follow-up) of the incident
IT Productivity Lost time and any additional expenses incurred with IT personnel downtime
End user productivity Lost time and any additional expenses incurred with end user downtime
Lost Revenue Total revenue loss from existing customers and potential customers because of their inability to access
relevant systems during the downtime
Business Disruption Additional economic loss including reputational damage, customer churn, and lost business opportunity
Operational
Resilience

Operational Resilience: Downtime Cost
Annual Fortune 1000
application downtime
costs
(IDC)
$1.25B
To $2.5B
Average cost of a
data breach
(Ponemon Institute)
$3.6M
Cost per hour of
a critical
application
failure (IDC)
$500K
to $1M
Average cost/hr of
network downtime
(Gartner)
$336K
Average cost/hr of
downtime
(Ponemon Institute)
$474K

AWS Benchmark: Operational Resilience Operational
Resilience

Measuring Business Agility
Development and Deployment Operations Customer
• Time to Market for new Applications
• Features per release
• New applications launched this year
• % of new applications launched on time
• Time to provision new applications
• Deployment frequency (revs / year)
• Time to deploy to test (days)
• Time to deploy to production (weeks)
• % failed deployments
• Total number of incidents /
defects
• % total defects found in test
• Mean time to resolution (MTTR)
• Response time to defects (hours)
• Adoption of new features (%)
• Value per release (i.e. revenue
potential)
• Customer retention (%)
• Employee retention
• Employee absenteeism (%)
• Employee NPS
• Customer NPS

AWS Benchmark: Business Agility Business
Agility

Examples of realized value
STAFF PRODUCTIVITYCOST SAVINGS OPERATIONAL RESILIENCE BUSINESS AGILITY
80% reduction in software R&D times
(Apeejay Stya & Svrán)
50% reduction in infrastructure
management (Graze)
Calc and reporting time cut from 10 days to
10 minutes (Aon Benfield)
Deployment frequency increased from once
very 6 weeks to once every week, soon to
be multiple deployments per day (3M)
Clinical simulations 98% faster than on-
premise (Bristol-Myers Squibb)
Image processing completed in hours vs 15
days (NASA JPL)
R&D RFS times reduced from 6 months to 1
day (NewsCorp)
Provisioning time cut from 3–4 weeks to 2
days (ENEL)
Test-run time cut to 10 minutes, from up to
2 hours (Yelp)
Launch new products 75% faster (Unilever)
62% increase in speed of deployment
(TAOlight)
DC footprint from 13 to 6 (The Weather Co.)
DC footprint reduced from 8 to 3 by 2018
(CapitalOne)
Migrated from Akamai CDN to Cloudfront to
save $140K annually (Allergan)
Over 50% reduction in costs (GE)
DC footprint from 45 to 6 (News Corp)
50% reduction in app costs (Time Inc.)
Cost savings of $20M p.a. (FINRA)
Computational cost reduced by 20%+
(ENEL)
Cloud deployment has saved US$34 million
in CAPEX and reduced OPEX by 85%
(Samsung)
Cost reduction of $40k p.a. (Dow Jones )
Savings of $1.5M p.a. (Trainline)
30% reduction in OPEX (MacMillan)
HBX is saving $1.8M annually in hosting
costs + $250K annually in data-center space
(DC Health Benefit Exchange Authority)
Scaled to handle a 400% increase in page
views (Kurt Geiger)
Remediation time reduced from 3 days to
80 minutes (GE Appliances)
8600 transactions/second (McDonalds)
Transfer of over 750 TB of data from
pipeline inspection machinery (GE)
Processing over 75 billion market events
daily (FINRA)
Critical applications run in multiple AZs, x-
Regions for robust disaster recovery
(Expedia)
Supports over 300,000 requests per minute
to its API (Easy Taxi)
60% reduced downtime (Trainline)
Migration of SAP on Oracle to AWS with
zero unplanned downtime across five
countries (Kellogg’s)
HIPAA & FedRAMP compliance & EHNAC
accreditation eliminated need for data
center inspections (FigMD)
Average annual staffing savings of $3m
(Adroll)
Energy Marketing business prepared for
acquisition in only 6 months rather than 12
(Hess Corp)
Reduced management time by 80%
compared to prior cloud platform, and
redeployed 3 IT staff to development
efforts (iFit)
Performance targets over-achieved by 43–
66% (McDonalds)
IT Infra consolidation completed in 20% of
expected time (Hearst)
60% of IT working on data proliferation,
lack of standards, security hardening all of
which AWS is addressing. (Intuit)
Over 500 hours per year of server
configuration time saved (Sage)
Reduced DevOps team by 50% with AWS
(Avizia)
10% of IT admin time now dedicated to
development efforts (Dr. Lal Pathlabs)

Creating the Right Business Case Enables You To
Quantify your business value
Accurately reflect your cloud transition
Envision the art of the possible
Correctly define your current and future costs

Building a Better Business Case for Migrating to Cloud

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