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How getting out of the data center business delivers exponential return on investment

Shifting IT workloads to the cloud can be a prudent, productive investment in the success of your company—if you play your cards right.

You’ll need to reorient your ideas about investing in technology. After all, cloud providers are the ones making significant investments in people, processes, and technology that support hundreds of clients at the same time.

By contrast, cloud services seem more about shaving today’s costs than investing in tomorrow’s profits. But that’s a limited view.

A savvy approach to cloud technologies can help you invest time and brainpower to gain the same kinds of advantages that used to require extensive outlays for hardware and software.

Let’s look at why the cloud presents a wealth of investment opportunities:

Switching from CapEx to OpEx

Somebody has to pay for data center hardware, software, and support. But it doesn’t have to be you.

That’s the fundamental appeal of shifting IT resources to the cloud. Cloud providers invest in designing, building, and provisioning powerful high availability, multi-tenant solutions of varying complexity. Clients cut costs and pay only for the IT resources they consume.

A consumption-based model is immensely attractive for:

  • Backup and disaster recovery
  • Seasonal businesses that need to burst capacity to meet demand
  • Organizations that are struggling to access the skill sets and don’t want to add headcount
  • Companies on the verge of replacing aging data center infrastructure
  • Tapping the benefits of cloud-hosted “as a service” technologies (software as a service, infrastructure as a service, etc.).

Moving all IT workloads to the cloud is not a cure-all. It may make sense to retain investments that have already been made in existing data center infrastructure and operations that have an extended lifespan.

These days, tech-savvy companies are adopting a nuanced, hybrid approach to the cloud. They’re keeping some IT operations on-premises while using the cloud where it makes the most sense.

This approach meets a prime investment objective: diversification. You’re strategically spreading your risks around and taking advantage of other people’s expertise and experience in dealing with other organizations such as yours

Letting somebody else chase the latest technology

Installing, configuring, and updating technology platforms is an endless challenge. Servers are quickly out of date almost the day you spin them up. Skipping an update or neglecting a patch gives cybercriminals an engraved invitation.

The high costs of legacy applications feel like financial handcuffs. You have to pay the software fees and hire IT people to configure and support the apps.

And sometimes, hardware manufacturers do their jobs too well. If you have a steady business whose IT needs remain within predictable parameters, you may find that each new generation of servers has more capacity than you need. You could spin up a new rack that uses about 10 percent of its capacity—blowing 90 percent of your investment.

Cloud providers take care of these concerns: They keep everything updated and running at peak capacity, so you don’t have to. That’s a wise investment of your scarce IT resources.

Scaling your enterprise

Scale can go both ways. Acquisitions often mean adding new locations, employees, and processes. Legacy companies need to wind down unprofitable divisions and build on their strengths.

In startup mode, many emerging enterprise organizations have a large magnifying glass over where they are investing and spending their scarce resources. If they don’t spend their dollars wisely they could be out of business in short order, so the consequences of not getting your cloud strategy can be a game changer.

In addition, private equity “carve-outs” can be both a challenge and an opportunity. Investment firms that have injected millions to acquire the assets of another company need to migrate the systems, applications, and data quickly and start to derive revenue from those systems as soon as possible. Time and again, an effective cloud strategy can gain the upper hand.

Ideally, technology investments yield flexibility and efficiencies that boost profitability and competitiveness. But that doesn’t mean you have to invest in physical hardware. The cloud lets you invest your time and expertise in finding the best tech solutions for your business.

Setting your IT people free

Which would you rather have your high-paid IT professionals doing—patching software or concentrating on the effectiveness of your customer service?

This simple model applies across the cloud ecosystem. Cloud providers take care of storage, backup, patching, monitoring, alerting, and remediation. They build data centers, buy servers, enforce security, and pay for electricity.

Lots of companies want out of the data center business. They prefer to let data center experts tend to the minute technology details and put their IT people to work strengthening the core business.

Finding talent is another thorny challenge. Older IT employees are retiring, and younger ones with the expertise you need are rare, expensive, or both.

Partnering with a cloud provider can give you access to top-tier talent you might not be able to hire on your own. For instance, the cloud allows companies of all sizes to deploy robust backup-and-recovery programs that have been fully tested and documented. However, it takes abundant expertise to design and implement a comprehensive disaster-recovery program. Many companies don’t have access to these experts.

The wiser investment: Partnering with the cloud experts at OnX. With decades of data center experience, we can make sure your cloud investment is the right fit for your market.

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