“The number of companies that are either on a path to or are already running most of their IT in the cloud is increasing,” says Deepak Mohan, research director for cloud infrastructure services at IDC.
Several factors are propelling the trend, according to IDC: better partnerships between cloud infrastructure and traditional IT providers, more cloud offerings from traditional IT providers, and a change in understanding around the cloud.
The Benefits of Cloud Agility
Walgreens Boots Alliance, owner of the Walgreens and Duane Reade pharmacy chains, is in the middle of a transformational shift to the cloud. In the age of COVID-19, it’s already seeing benefits.
“We’d been underinvested in technology for many years,” explains Dan Regalado, the company’s vice president of global technology transformation and strategic partner management. “We have a significant amount of infrastructure that, although well architected, is starting to show its age and become an inhibitor for us becoming an innovative company.”
WBA began an ambitious, four-phase effort to adopt a cloud-first approach, including a massive migration of its 100-terabyte (and growing) corporate SAP environment to Microsoft Azure. The move to SAP S/4HANA on Azure took place over just 20 hours in January 2020.
WATCH: Learn how to deploy a multicloud strategy to control costs and increase agility.
“We want to go to the cloud to get the agility that comes with it and we’re starting to see the payoff,” Regalado says. “When we went into lockdown, we had to make significant changes in the way we serve our customers. Within a matter of weeks, we were able to give them the ability to buy online and pick up in-store or buy online and pick up curbside. We also established a partnership with DoorDash across many of our stores that was enabled by the cloud.”
If agility has been a key driver of WBA’s cloud migration, so has cost efficiency, Regalado says. The Deerfield, Ill.-based company is attempting to modernize everything in its IT portfolio — roughly 800 applications in all. Since the company now pays only for the computing power it needs, it can invest more strategically.
“By going from heavy, heavy CAPEX to OPEX, we’re able to use our money wisely and enjoy speed to market,” explains Regalado. “We can very quickly, in a matter of weeks, show up with different value propositions for our customers, when historically it would take us months.”
A Business's Roadmap to Full Cloud
Going all-in on cloud may not be for every company just yet. So, how does a business know it’s ready to move aggressively?
“A good indicator is how easily the company has adopted new technologies in the past,” says IDC’s Mohan. “For example, has it adopted open-source software and unstructured databases?”
Even if the answer is yes, not all businesses can move all workloads smoothly to the cloud.
“A lot of companies with historically big IT footprints, like in banking and even healthcare and government, have workloads that have been built on and run on mainframes and Fortran, which can’t easily move to the cloud yet,” Mohan says. “As a function of scale, those will probably stay on-premises for some time.”
Mohan says that typically, web-facing and secondary storage workloads are good candidates for the cloud. So is any workload that needs to expand over time. “Data-intensive workloads like databases tend to be good workloads for the cloud because then you can take advantage of adjacent cloud services like artificial intelligence markup language and analytics to drive insights.”