Executive Q&A: What’s Driving the Multicloud Move?
It used to be that moving to the cloud was a struggle. Now it’s moving to multiple clouds that is the challenge. We asked Jon Cyr, VP of product management at Virtana, to review results from their latest survey of multicloud environments.
- By Upside Staff
- August 3, 2022
Upside: It seems as if organizations have gone from “kicking the tires” of the cloud to adopting a multicloud strategy almost overnight. Your survey found that 82 percent of organizations already had a multicloud strategy. What’s driving this move? What benefits did enterprises expect and are they realizing those benefits?
Jon Cyr: Though most organizations have a multicloud strategy, over half of respondents are maintaining a hybrid cloud strategy -- private or co-located data centers alongside their public cloud instances. What’s driving these enterprises to move to the cloud is improved availability (due to cloud service provider (CSP) reach), agility (speed of deployment), and efficiency (both in terms of cost and people).
Shifting workloads to the cloud brings the agility they need to maximize resources and cost -- and with improved availability, the cloud can streamline processes, making them more efficient and avoiding idle resources. Additionally, by moving to the cloud, companies can embrace a remote workforce because teams can connect and collaborate from all over the globe -- something that COVID-19 has required.
Gartner says, "Organizations with little or no cloud cost optimization plans rush into cloud technology investments. They end up overspending on cloud services by up to 70 percent without deriving the expected value from it. Executive leaders must use this research to realize cost savings and avoid cloud overspend." (See Note 1.) When moving to the cloud, enterprises expect lower costs and the ability to maximize resources and system and data availability.
With the abundance of tools used to optimize public cloud instances, 83 percent of organizations are expending manual effort to consolidate their tools, decreasing efficiency. It’s crucial for these organizations to automate the data consolidation process in order to realize these benefits and the full potential of the cloud. That starts with gaining a comprehensive and complete view of their infrastructure.
I was surprised to learn that 38 percent of respondents that don’t currently use multiple clouds plan to not just move to the cloud but use three or more by the end of the year. That’s a pretty big move full of risks. What best practices can you suggest to make them successful?
The best way to succeed in moving to the cloud is by truly understanding your workloads before you move and then implementing cloud governance controls once you’re there. By doing this, you make the most of the space and resources you have available in the cloud and the money you have invested in the project. However, as you point out, 75 percent of organizations do not have this type of strategy.
Companies could also leverage workload portability or serverless computing to help enhance their cloud deployment. Workload portability is the ability to easily move workloads between on-premises systems and across multiple CSPs. Our research has found that 96 percent of organizations see the value it provides because it can maximize cost savings, but it’s still problematic for most because applications are not built to do this. Additionally, 95 percent of organizations see value in a serverless strategy, which offers the ability to allocate resources on demand, for its ability to scale and reduce costs.
As a company, our focus is on what we call “day zero”, the planning aspect of a customer’s migration to the cloud. This way the customer is not surprised by the deployment itself, costs or idle resources.
By “multiple” cloud providers you don’t just mean two. Your survey found that more than three-quarters of those surveyed have workloads deployed in more than three public clouds. How are enterprises splitting the workload?
There are a few reasons. In talking to our customer base, they do not make this decision lightly because every additional cloud incurs costs, so selection is usually tied to need and capabilities offered. For example, if a company was in need of a CSP in Asia they may be looking at a particular provider or if they had a need for a call center software package, they may be looking at a different provider.
What’s a bit concerning is that half of respondents say they plan to increase the number of public cloud instances by the end of the year, yet 75 percent say they lack cloud governance to guide their cloud management. Isn’t that dangerous? What recommendations do you have for organizations facing this governance problem?
Yes, the lack of governance is a big risk when moving to the cloud. Customers should put governance plans and policies in place before they move to the cloud or risk having to go back and retrofit their deployments.
If an organization is looking to control costs and risks, and maximize the benefits of migrating to the cloud, unified visibility and cloud management are critical to enforcing cross-functional accountability and formal governance. Companies need to have a complete view of their infrastructure to make the best cloud decisions for their organization.
As a first step, companies need to get a consolidated view of their performance and availability needs. These can then be costed out and tracked to make sure the company is not overspending while providing at least the same or better experience. Our latest research found that 73 percent of organizations have siloed efforts that are limiting their ability to realize the full potential of the cloud. In order to have a complete view of an organization’s infrastructure, the key is building a strong FinOps team, and this was further evident in our findings -- 87 percent seeing the value of having such a team.
Additionally, implementing workload portability and/or serverless computing is another way to improve management capabilities, and many organizations see the value in each approach. As I mentioned, 96 percent of enterprises see the value in workload portability because they hope to achieve cost savings, reduced risks from changes in CSP quality and performance, and increased business agility. Additionally, 95 percent of enterprises see the value of a serverless computing offering for its ability to support increased scalability and reduced costs.
It’s imperative that cloud management vendors offer these types of approaches and make it easy for enterprises to implement them, because only about one-quarter of enterprises have actually implemented either workload portability (29 percent) or serverless computing (24 percent) to improve their cloud management.
Enterprises seem increasingly concerned about cloud costs, yet your survey found that although 87 percent of respondents say there’s value in financial management of cloud costs, your report calls it “early days” because 70 percent have started but have not yet developed a mature practice. Why not?
According to The State of FinOps Report 2021, most organizations are still navigating how to manage their FinOps practice, and although many are in the early stage of their FinOps journey, it’s expected to grow by 75 percent next year as more companies prioritize this. Most enterprises also have different names for their FinOps practice, some calling it cloud cost management, cloud financial management, or cloud economics/cost optimization -- which is further evidence that having this department is not yet standard practice.
Many organizations also don’t have the resources -- or have limited resources -- to implement a proper FinOps practice. There is also fear that by automating the process, employees will be too far removed from the action and might not fully grasp the data. Organizations need to find the proper balance of removing highly manual tasks while simultaneously empowering employees with the right information and understanding so they feel connected to the process.
Lastly, many organizations feel that a standard FinOps team lacks real-time cost analysis, foundational education, reporting capabilities, the full cloud spending picture, and the ability to start conversations and enact change about cloud management. Clearly, the industry has not formulated a standardized way of creating a FinOps practice and creating guidelines to address its role in the organization. Until that happens, companies will be hesitant to start their own.
Nearly two in three respondents said they use five or more separate tools for migration, cloud cost optimization, IPM, APM, and cloud infrastructure monitoring. Even worse, 83 percent say they are expending manual effort to consolidate data from all of these tools, and of organizations using 20 or more tools, over half still are using manual processes for these tasks. Why so many tools, and why all the manual effort?
The amount of data is ever growing, and you need to have the data integrated or consolidated. In order to do that you need to have automation (AI or machine learning) that will sift through the data and deduplicate, correlate and detect anomalies, and point out the problem and automate actions. Humans simply cannot process this much information and more specifically, if it's not integrated, you can’t do it at all.
Having too many tools isn’t the problem, because each tool has a very specific function -- and as you might expect, teams have built processes around these tools and they don't want to change. Data consolidation, volume of data, correlation, and a lack of automation are the issues and this is where organizations are expending the manual effort to do this.
If you can’t consolidate or integrate your data across the five or more tools you have, you’re not getting a complete view of your cloud infrastructure, which can expose you to excess cost, performance issues, and other related risks. The problem with manual consolidation is it creates gaps and limits visibility and control. The key to consolidation is having an automated process, but as you said, only 17 percent of organizations have this in place.
Enterprises need to start here: consolidate data across the tools you have in place so that they talk to one another -- regardless of how many you have -- and build in automation as the process becomes more complicated.
What results of the survey were in line with your expectations?
Multicloud is here -- we knew this and the survey lined up with our expectations. We also expected the metric around how many companies had FinOps teams -- as I mentioned earlier, it's driven by maturity. There are a lot of mature companies, but a majority of them are still in early days.
What results surprised you?
What surprised us I think was the number of companies with greater than three CSPs. Given the maturity again, we expected the "big three" but the research showed that 78 percent of companies are using upwards of three CSPs, which was pretty shocking. In addition, companies are only growing their public cloud portfolio as the percentage of enterprises that have used five or more CSPs has increased 17 percent year over year. Furthermore, 78 percent of enterprises plan to include public cloud in their future cloud migration strategy.
[Editor’s note: Jon Cyr is the VP of product management at Virtana where he is responsible for the overall strategy and product direction of the Virtana portfolio of “ITOM” products. You can reach Mr. Cyr on LinkedIn.]
1. Gartner, "Realize Cost Savings After Migrating to the Cloud," April 28, 2021.