Three ways to optimize your hybrid cloud strategy to be future-ready
As we enter the third decade of cloud implementation, figuring out hybrid cloud should be on every organization’s agenda to take advantage of the promise of digital and Generative AI (GenAI). Whether it be for faster product development, greater agility and security, hosting large data models, or simply modernizing legacy systems – hybrid cloud will continue to power enterprise applications and processes.
Deloitte’s 2024 study on technology value found that legacy systems dependency with related technical debt is one of the top challenges faced by nearly 60% of almost 400 US respondents in the pursuit of their digital transformation. Hybrid cloud might very well be the bridge to overcome these challenges and build a future-ready tech strategy. Indeed, hybrid cloud allows for interoperability across multiple cloud providers as well as between cloud and on-premises (on-prem) systems, providing a high-speed, low throughput flow of information expected from modern technology platforms.
Hybrid cloud strategies will need to evolve for the next generation of cloud architecture and will be important for companies looking to succeed in the digital Edge Resource Allocator (ERA). Therefore, CIOs, CTOs, and other cloud leaders can focus on three actions to optimize their hybrid cloud strategy: invest in horizontal platform infrastructure and architecture strategies to address legacy infrastructure challenges, evaluate how hybrid cloud strategies verticalize to support full stack GenAI and cyber capabilities, and measure short-term and long-term success across the entire cloud ecosystem using a holistic Key Performance indicator (KPI) framework.
Invest in horizontal platform strategies to address legacy infrastructure challenges
In 2024, US respondents are investing 13% more of their annual digital transformation budgets year over year in data and platform strategies, per a Deloitte survey. This indicates an increased market focus on digitizing information and modernizing computing capabilities across their businesses. Prevalent among those investments are cloud platforms, where 57% of US respondents invested in 2024, and cloud native applications.
For leaders investing in any type of cloud capability, even if it is just with one provider, developing a hybrid cloud strategy grounded in intentional architecture decisions becomes even more important. Why? Hybrid cloud is the backbone to connecting cloud-enabled data, services, applications, and infrastructure and thus the key to building a robust data foundation and modernizing computing platforms for the future. A future-focused ‘horizontal architecture’ can help bring together public, private, on-prem, and even mainframe components for a more efficient and secure flow of information. For example, 'cloud bursting’ is one horizontal solution employed in hybrid-cloud models where, based on demand, processing automatically scales out to the public cloud for additional compute power, and then seamlessly scales back to on-prem infrastructure once the demand tempers. A common example is during a Black Friday sale – a retail application can burst to the public cloud to meet the surge in customer demand, and then scale back to on-prem infrastructure once the surge demand has been met. This variability in cloud computing needs is more important than ever now with GenAI, which can have large spikes in computing demand.
Evaluate how hybrid cloud strategies support GenAI and cyber capabilities
Hybrid cloud strategies will require leaders to think vertically as well about critical interaction points with other technology capabilities like Artificial Intelligence (AI) and Cyber. For example, cloud services and platforms are essential to support GenAI training/tuning and computing demand. However, given GenAI technology ecosystems are still maturing, leaders should build interoperable technology components to manage the risk of vendor lock-in and scale cloud usage to support GenAI computational needs and security risks.
Seventy-three percent of respondents in a Deloitte study say that increasing investments in intertwined technologies like GenAI are expected to fuel investments in cloud. And rightly so. Cloud-enabled systems can drive training data into large language models (LLMs) that live on-prem and/or in the cloud to process and output the model’s intended results. Organizations will need to account for variable consumption costs that can often come with surge demand if they plan to build and scale effective GenAI systems.
Similarly, cybersecurity continues to play a large role in cloud application and infrastructure security across hybrid cloud environments. In 2024, we have seen that cybersecurity spend has become tightly integrated with the cloud budget.
Thus, as leaders think through their cloud investments and strategies, they need to intentionally factor in other technologies, reassess their cloud infrastructure and capital allocation, and set short-term and long-term objectives grounded in both.
Measure short-term and long-term success from hybrid cloud using a holistic KPI framework
After horizontal platform and vertical strategies, leaders will also need to think about how they measure success against key milestones in the short and long term. Hybrid cloud can come in many forms across applications and infrastructure, cloud to cloud, as well as cloud to on-prem environments, with benefits cascading across the entire organization.
Deloitte research shows that the majority of respondents who invest in cloud measure ROI quarterly or annually, while only about a third measure it every 2-5 years. Leaders need to develop a consistent, holistic KPI framework that measures both the short-term and long-term value of cloud across the whole enterprise. Adopting a dual time-horizon strategy with a broad measurement framework ensures that you maximize value from your hybrid cloud strategy.
CIOs, CTOs, and other cloud leaders are uniquely positioned to guide their organizations through the transformative ERA of cloud computing because they own the horizontal architecture decisions, the verticalization of the tech stack, and how it all comes together to drive short and long-term ROI. A hybrid-cloud strategy grounded in all three of these factors can help the organization to be ‘built to adapt and scale.’
Originally published on SDxCentral