As we explored in the introduction to this series, a comprehensive build phase is a critical component in any successful cloud migration. One of the first key steps in successful cloud migration is to establish a Cloud Centre of Excellence (CCoE). This is made up of a cross-functional team with a strong C-level mandate to lead the cloud journey.
The team should include both internal resources and external experts to compensate for any skills that are not yet developed in-house. Empowerment is key to enabling this team to focus on the most critical elements of this phase: target design, migration strategy and cloud risk management.
Target design
To ensure a swift start in your cloud journey, we recommend starting by developing a target design across three dimensions: Baseline & Cornerstones, Target Architecture, and Business Case.
The Baseline & Cornerstones dimension focuses on examining your current infrastructure to identify toxic assets, tech debt, and other priority areas that could yield quick wins. This assessment is also essential for identifying key dependencies and constraints that may be obstacles during the migration, and for building your cloud business case.
The target architecture dimension should consider all technical and business requirements collected during the baseline phase to ensure proper performance and security.
It should not only focus on IT infrastructure modernization, but also on the implementation of a comprehensive approach to drive application and business transformation.
One key outcome of this step is a comprehensive top-down target technological landscape, defining the standard list of technologies and platforms with an outlook of 3-5 years.
This vision, and the resulting “no-regret moves”, provides the available options for the second key outcome: the definition of the migration approach for each app in the current application map. The combination of these two outcomes will provide a clear target state for the current application map and the app-specific indication on “how” to reach it.
Moreover, the business case of the cloud journey is complex and can be misleading, so it needs to be developed holistically. It should include both technology and business dimensions to ensure all benefits and costs are considered, such as increased innovation, lower time to modernize applications, and easier access to advanced technologies.
As described in BCG’s article on Cloud computing, the quantifiable benefits could include 15% to 40% lower infrastructure costs, 30% to 60% faster time to market, and 25% to 50% increases in productivity. The business case should be broken down into major milestones to be achieved throughout the journey as guidance for the migration.
Migration strategy
One way for companies to minimize risks during a cloud migration is to start with a slow approach, migrating only single applications or running proofs-of-concept (POCs) on temporary infrastructure. However, this approach may not provide enough data to validate the business case and create enough momentum to kick-start the migration.
An alternative approach that has been successful for many clients is to launch a pilot on a subset of connected applications in production. This subset should be large enough to validate the different dimensions of the business case, as well as the benefits of having interdependent applications on the same infrastructure. The applications should be selected strategically to validate the project cornerstones, key target architecture design, and migration assumptions. Another option is to adopt an agile approach, starting small and iterating frequently. This will help build momentum quickly.
The pilot is a strategic investment that aims at setting up the cloud technology backbone, accelerating employee learning, and identifying knowledge and process gaps. It is an opportunity for employees to experiment and learn new tools and ways of working. Business users should be involved in defining the scope of the pilot and testing the outcomes, to ensure the business value of the transformation is demonstrated and understood.
C-suite stakeholders from IT and business should be engaged to establish the right level of availability and focus of resources on the pilot. Expectations for the pilot should be clearly defined and tracked as key performance indicators (KPIs) and presented regularly.
Cloud Service Providers (CSPs) offer standard frameworks and guided paths to accelerate the build phase, which typically includes CSP resources. These methods are designed to support in the tools setup and to oversee the availability of discounts and credits for the pilot.
Cloud risk management
It is especially important to draft a robust cloud risk management strategy during the build phase. This is required to effectively manage cloud risks, ensure confidentiality, and the availability of data and applications in the cloud.
During this phase, the company is still experimenting and adapting to the modern technology. It is during this initial stage that teams are more likely to face various challenges, such as data breaches, unauthorized access, and service disruptions. These events can cause considerable damage to the company’s reputation, financial stability, and regulatory compliance.
A cloud risk management strategy can help companies to identify risks and implement appropriate mitigations, especially when the shared responsibility model between the cloud provider and the company is well understood. Other vital factors include implementing strong access and identifying management controls, monitoring cloud activity and performance, and having a comprehensive resilience framework to deal with contingencies. These are frequently associated with vendor failures, cyber incidents, and natural disasters.
Next steps
With the right target design, migration strategy and cloud risk management in place, a robust build phase will be achieved.
At this stage in the process, organisations will be in a strong position to begin preparing to scale up and expand their approach.
In the next part of this series, we will explore the technical and operating model considerations that an effective scale-up phase entail.
Find out how to master all the three phases in our article series.
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About the Authors
Combining experience in top consulting firms and major corporations, Gianfranco is highly successful in delivering complex IT transformation and restructuring. Gianfranco joined BCG Platinion in 2017 to lead the recently founded Italian branch. He is in charge of promoting the business objectives as well as the development of staff and office activities. Before joining, Gianfranco covered key leadership positions within renowned consulting firms, and held managerial positions as CTO for one major Italian Utilities and as COO for an Italian Telco operator. His professional experience is primarily dedicated to IT strategy, transformation and restructuring, IT application & infrastructure optimization, as well as digital architecture, cloud strategy and complex digital transformation programs mainly in the Energy & Utilities and TMT industries. Gianfranco received his degree in Economics with Honor from Università degli Studi di Bari, Italy in 1999.
Alessandro has 20 years of consulting experience, with a focus on Technology & Digital transformations in several industries, including Energy and Consumer Products. He also serves as the Global Lead for TDA (Tech and Digital Advantage) in Energy. In his BCG career, he gained significant experience in several Digital & Technology core topics such as Data Platform and Next generation IT Architecture, ERP and Enterprise software, leading Customer Journey transformations, and Data Science use cases realization. Moreover, he helped many companies in many sectors in their journey to Cloud.
As a manager at BCG Platinion’s Milan office, Antonio Spanò has eight years of experience in consulting. He specializes in leading projects for the industrial goods and energy practice areas, ranging from IT strategy to digital and cloud transformation implementation, across Europe and the Middle East.
Michele Colombo is a Principal at BCG Platinion based out of Milan and focusing on IT Strategy, Cloud & Data projects for clients in the Financial Institutions, Energy and Private Equity industries across Europe, Middle East and Asia.
Marco Tassiero is a Manager at BCG Platinion with more than 7 years of experience in Digital Transformation and Application Landscape Modernization projects. He joined the firm after a previous experience in another consultancy company focused on Customer Journey Automation and Customer Service Excellence. In his role in BCG Platinion Marco has supported clients from different industries, such as Energy and Consumer Goods, in designing, launching and managing their Cloud Journeys.
Federico is a Senior Consultant at BCG Platinion with 7 years of experience and a focus on cloud & data strategy projects as well as IT transformations. Since he joined BCG Platinion in 2019, Federico has supported clients across several industries, from Energy and Consumer Goods to Financial Institutions. Today Federico is specialized on supporting the development of the IT & digital agenda of clients in the Industrial Goods industry practice area, across Europe and Asia.
Abhinav Gupta is a Knowledge Expert at BCG based out of Bangaluru. He has 8 years of experience working with clients in addressing challenges with respect to cloud migration journey, IT Sourcing, IT cost optimization & Infrastructure transformation.
