Organisations are increasingly spending more on cloud computing, with public cloud services being a key focus for many companies. Worldwide end-user spending on public cloud services is expected to grow 20.7% to $591.8 billion in 2023, up from $490.3 billion in 2022. 

More and more businesses are moving applications from on-premises and colocation to multi and hybrid cloud solutions. There are many reasons for this: affordable security, scalability, flexibility and business agility, to name a few. Data from our 2022 Cloud Impact Study indicated that hybrid cloud dominated cloud approaches, with 86% of companies adopting or planning to adopt a hybrid or multi-cloud strategy. For context, a hybrid cloud is defined as a mix of traditional infrastructure environments with at least one cloud provider, while multi-cloud includes at least two cloud providers in the mix.  

But, despite these benefits, this migration must be carried out carefully. There are certain challenges and hurdles that businesses need to consider when developing an effective cloud strategy, particularly a multi/hybrid cloud approach that spans different locations. 

Changing cost landscapes 

The move from traditional IT infrastructure to the cloud brings with it the possibility for cost savings as organisations make the well-documented shift in approach to IT spend from the Capital Expenditure model (CapEx) to the Operational Expenditure model (OpEx). 

Companies are presented with opportunities to only pay for resources that are actively in use in the cloud rather than ‘over-purchase’ equipment in year one of a CapEx procurement cycle, ensuring that they don’t run low on resources in year five of that same cycle. This same model presents the possibility to ‘burst’ resources at times of peak demand, allowing organisations to ensure that resource constraints don’t adversely impact the user experience of their customers. 

Poorly planned migrations 

With this changing cloud landscape and the shift from CapEx to OpEx, we have seen many businesses make the mistake of attempting a simple ‘lift and shift’ approach to migrations – something that is often not-so-simple. This involves businesses replicating their legacy infrastructure, like-for-like in the public cloud. This is often where many businesses trip up by not using the cloud to its full potential.  

The applications that migrate to the cloud need to be scalable for a start. This usually requires re-architecting them, planning deployment and making sure applications are cloud-ready to be scaled effectively. The main problem with this is that this takes time and skill to do so correctly but can also be costly further down the line if not done properly.  

Increasingly, organisations are realising that by doing this lift and shift to the public cloud, they haven’t achieved the results they wanted. The promised cost savings often fail to materialise and organisations are left disillusioned by their public cloud experience. This problem is largely due to the fact that they haven’t re-architected their ecosystems effectively. This frequently results in non-elastic solutions or the realisation that there is a more appropriate approach that could be used in their deployments.

For example, organisations often reflect on decisions, such as storage location choices, as they realise that the incorrect storage tier or location means that they are unable to meet SLAs or data residency requirements. This can result in a retrospective re-architecting of an organisation’s environment, which often reveals that a hybrid approach to service delivery is more appropriate. Concerns with integrating cloud and legacy applications were evident in our 2022 study as 44% of respondents worried about carrying this out properly.  

Specialised skills gap 

In the UK, there is a large digital skills shortage at the moment with only 11% of UK workers possessing advanced digital skills. In 2022, seven in 10 businesses said they wanted to accelerate their cloud adoption but lacked the internal expertise to do so. 

The problem is that many infrastructure engineers are very familiar with and skilled at working in colocation but haven’t yet been upskilled to manage hybrid cloud. If businesses don’t have the right talent internally, it is very difficult to manage this migration to a hybrid cloud correctly and effectively. This is why organisations tend to turn towards and lean on the help and support of third-party providers such as MSPs and Managed Hosting Providers. They offer the skills and talent that internally a business lacks and can help bridge the gap between colocation and cloud.  

Hybrid: the best of both worlds? 

Businesses that opted for the lift and shift approach a few years back are frequently realising they haven’t made the cost savings they expected from their move to OpEx. Their decision to put off the re-engineering of software systems during their cloud migrations, which at the time is often seen as a cost saving, ultimately means that legacy systems are shoe-horned over to the public cloud when they’re really not designed to work effectively on public cloud infrastructure. 

Although this does perhaps extend the life of legacy systems, it doesn’t fundamentally deliver any improvement in customer experience – indeed the users sometimes encounter an inferior experience. When reviewing their software systems, companies often decide to dovetail the application modernisation with the introduction of a cloud-based ERP or CRM system to ensure both effective cloud utilisation and delivery of an up-to-date software system and experience for their users. 

The flexibility and scalability that hybrid cloud offers is one of the main reasons that enterprises are moving towards hybrid cloud environments. The ability to choose where to host each part of your applications in order to deliver optimum performance and meet specific data sovereignty and security requirements, all while carrying this out in the most cost-effective way, is a compelling case for what hybrid cloud can offer. Application modernisation also affords organisations the opportunity to re-evaluate market offerings, sometimes providing the option of replacing part of their infrastructure with a SaaS solution and removing the requirement for infrastructure.  

Which way is right? 

The transition from colocation to hybrid that we are seeing many businesses carrying out should by no means be seen as an ‘easy’ method. Hybrid cloud has many benefits, but these can only be realised if carried out correctly and with forethought and planning. There are also of course hurdles to hybrid cloud such as scaling up and re-architecting programmes, which can be costly — particularly if done incorrectly. A lack of internal specialised skills is the main cause of this and is a big challenge for many businesses. 

But the transition doesn’t have to be so taxing on businesses. Employing the skills and support of MSPs will help enterprises to make the most of the cloud in terms of data residency, cost and flexibility.