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How Do You Calculate the ROI of Cloud Migration Services?

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Micro Age

Migrating business systems and infrastructure to the cloud promises tremendous potential benefits around flexibility, scalability, Cybersecurity Consulting Services, and lowered IT costs. However, embarking on a major cloud migration also represents a serious investment into planning, platform procurement, data and application transitions, testing, training, and change management.


Prudent executives rightfully want to quantify the return on investment (ROI) of such endeavors through detailed analysis rather than assumptions. 

This article explores key considerations around calculating ROI for cloud migration services.


Cost Savings


For most organizations, the primary motivation behind large-scale cloud migration comes down to hard cost reductions. Transitioning physical servers, storage, networking gear, and hosted applications to cloud infrastructure as a service (IaaS) and platform as a service (PaaS) eliminates the heavy capital expenditures needed for on-premise environments.


Instead, businesses pay only for actual cloud capacity consumed. Staff resources needed to maintain equipment and manage data centers also see significant reductions post-migration. Tally all direct savings from retiring owned infrastructure and data centers to reveal considerable benefits.

Productivity Improvements


Migrating to the dynamic Azure cloud also unlocks considerable productivity gains thanks to the inherent flexibility, scalability, and efficiency cloud platforms offer. Easy ability to spin resources up or down on-demand matches usage needs closely for minimizing waste. Staff also configure and access computing resources faster. 


Evaluate key metrics like server optimization rates, page load times, and average provisioning time’s pre and post-migration to quantify productivity gains. Faster access and processing speed compound workforce productivity.


Risk Reduction


While harder to directly quantify ROI, migrating services like email, collaboration tools, and vital business systems to secure the Azure cloud platforms greatly curtail risk. Top-tier data centers operated by Microsoft Consulting Services provide physical and network protection impossible for most companies to replicate on-premise. 


Built-in redundancy and automated failover fortify uptime and data integrity. Although expenses related to third-party migration services from partner experts must be accounted for, risk mitigation should remain central in ROI discussions to showcase the cloud’s indirect value.


Accounting Challenges


Migrating individual applications on a targeted basis allows a fairly direct comparison of costs for accurate ROI reporting. But altogether transforming backend infrastructure and adopting broad platform services create difficulties in precisely tying ROI to specific cloud implementations. Isolate performance metrics around impactful apps first before branching into wider cloud adoption. Cleanly delineating ROI requires analyzing the granular differences in speed, capability, and consumption of resources before and after the migration of services.


Conducting Cost Analysis


Financial leaders weighing cloud migration ROI must incorporate detailed cost analysis considering all factors over multi-year horizons. Map out all anticipated costs over the next three to five years for maintaining current on-premise infrastructure across hardware, software, facilities, and labor.


Contrast this with projected investments into cloud platforms and services over the same period. Weigh productivity, efficiency, and risk adjustments as noted above. The figure may justify higher short-term costs. Seek outside consulting support from experienced IT advisers like MicroAge to produce accurate projections.


Wisdom Nuggets 


  • Calculate hard IT cost reductions from retiring owned infrastructure
  • Evaluate productivity improvements around efficiency
  • Consider risk reduction and continuity safeguards
  • Isolate app-specific Data Migration Services for the clearest ROI measurement
  • Project long-term cost analysis spanning 3-5 years


Wrapping up 


It determines the return on investment from significant Cloud Migration Services. It initiates spans well beyond a simple formula. Rigorously quantify both ongoing expenses eliminated through retiring on-premise systems and new costs incurred for cloud services over multi-year time horizons for comparison. 


An experienced managed IT services provider like MicroAge brings invaluable analytics and benchmarking guidance to produce credible ROI case studies supporting strategic migration decisions. 


Reach out to their experts today to take the first steps toward revealing the hard cost justification behind migrating technology infrastructure and Azure Migration Services secure, scalable cloud platform.

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