In most companies Facilities and IT have historically operated far more separately than in alignment. Most observers understand that this is not the best way to operate but that organizational barrier has been resistant to change. Now, however, the simple economics associated with adoption of cloud computing is forcing the issue.
When a data center sourcing strategy includes a cloud component, it is no longer possible to plan facilities and IT independently.
Cloud computing pricing includes both the facilities costs and the IT costs. That means cloud costs need to be measured against any offsets on both the IT budget (licensing, hardware, etc.) and the facilities costs (data center, colo costs, etc.). The implication is that previously distinct facilities and IT spending must now be considered and budgeted jointly. When a company is choosing between on-prem and the cloud it is a decision that impacts many areas or departments that do not typically work well together.
Let’s imagine a cloud initiative that is large enough to move the needle for all departments:
1. Facility: Reduced loads force or enable data center reduction or consolidation. In this case, some costs are getting saved in the Facilities budget while some corresponding costs are being added to the Application Owners’ costs. i.e. cloud cost hitting their budget directly or indirectly.
2. Compute: Fewer VMs, ESX hosts, lower hardware and licensing costs. Where are these costs budgeted vs. where do the cloud costs hit?
3. Applications: App transformation costs. There will be one-time development costs to make applications cloud compatible.
4. Staffing: Smaller facilities, Bigger cloud and IT governance, more developers. Again, these cloud impacts span multiple budgeting areas.
As this incomplete list implies, when a data center sourcing strategy includes a cloud component, it is no longer possible to plan facilities and IT independently.
Without sacrificing our mission critical roots, EYP MCF has broadened its expertise footprint to help our clients develop integrated strategies that both dive into the functional area details without losing the collective view of Facilities, IT, and Cloud.
As this new reality affects our clients, it has similarly forced EYP MCF to evolve and invest in new expertise and skills that go far beyond the traditional world of facilities. To enable our strategy service to encompass IT, Cloud adoption analysis, and the resulting deeper and more complex financial analysis we’ve done the following:
· Invested in further developing our own staff with cloud expertise.
· Developed a partnership and joint data center strategy and Application Analysis service with a Cloud Adoption partner.
· Invested in our finance expertise in order to perform comprehensive total cost analyses that incorporates the newly intertwined facilities, IT, cloud, and staffing cost elements.
Without sacrificing our mission critical roots, EYP MCF has broadened its expertise footprint to help our clients develop integrated strategies that both dive into the functional area details without losing the collective view of Facilities, IT, and Cloud.
