Despite the cloud’s popularity, there are still some companies that have a single “cloud cheerleader” who is fervently extolling the benefits of managed cloud hosting to their senior executives. It can be challenging for them to get a green light from the right decision makers, especially if they’re focusing on the wrong benefits or meeting with a lot of resistance from their colleagues. If you’re selling the cloud to your C-suite, HOSTING has you covered. Keep reading for tips on building a strong cloud business case.
Focus on the top three cloud benefits – cash flow, cost savings and agility
The explosion of data and mobile apps have many executives wondering how they can cost-effectively store, access and manage their critical information assets. A key benefit of the cloud is the ability to reduce capital expenses which can improve cash flow. In the past, IT teams simply purchased additional servers and other hardware assets. However, these assets don’t allow you to auto-scale your environments. So if you’re an e-commerce site, you may need to significantly increase your storage capabilities during peak shopping periods such as Black Friday and Cyber Monday. But during the remaining 363 days of the year, these extra resources are under utilized. With the cloud, IT can purchase computing resources as they need them.
Another perk of investing in the cloud is that is can be expensed – the full annual cost of cloud computing services can be written off against business revenue. If your organization purchases computers, servers and the like, they must be normally depreciated. So while your company pays the full prices for these assets, it can only deduct a portion of the purchase price per year.
Check out our blog post, Calculating Cloud Computing Costs – CapEx vs. OpEx, for my information on how cloud computing investments impact your organization’s balance sheet.
Another key benefit of the cloud is the ability to offload support, maintenance and licensing costs to the cloud service provider. If your company purchases additional servers, they must invest additional resources into ensuring they are properly monitored and maintained – not to mention having enough space to store, power and cool them. When you invest in the cloud, you are mainly investing in services. So the cloud provider is responsible for maintaining its data centers, servers and other equipment. In most cases, security and support services are also the cloud provider’s responsibility, as outlined in their service level agreements (SLAs). This arrangement can result in significant cost savings.
The cloud also provides organizations with business agility. By investing in managed cloud services, the cloud provider often assumes the “daily duties” of securing, monitoring and patching your organization’s IT assets. This can free up IT teams to focus on more strategic, revenue generating activities. Additionally, cloud computing services allow you spin up resources and applications quickly to support new business initiatives and/or variable workloads.
Determine the total cost of ownership
Cloud cheerleaders often make the mistake of pitching the cloud to those who hold the company’s purse strings. Consider getting buy-in from your key stakeholders first – your IT team and departments that will be impacted by a cloud migration. Find out whose budgets the cloud costs will come from and prepare a pitch based on the total cost of ownership (TCO) of the cloud. Your TCO pitch should show the cost of acquiring, sustaining and supporting the cloud over the course of a fixed period of time such as the amount of time computers and servers are kept in your company. It should also show expected savings from using the cloud with a focus on capital cost savings and operational savings.
Finally, factor in agility into your pitch. You can do this by asking your department heads how they currently respond to sudden or unanticipated changes to their business – such as a surge in customer demand for widgets or a decrease in sales from a particular product line.
Need help in crafting your TCO chart? Our blog post, Calculating the TCO (total cost of ownership) of Cloud Computing, can help.
HOSTING cloud experts stand ready to help you successfully sell the cloud to your C-suite. Contact us anytime to discuss your specific goals. And view our on-demand webinar, Selling the Cloud to Your C-Suite, to help you craft a winning pitch.