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Global Capability Centers (GCCs) vs. Traditional IT Outsourcing: Which Is Right for Your Business?In an increasingly competitive global market, businesses must make strategic decisions about how to structure their operations for maximum efficiency, innovation, and resilience. Two prevalent models for managing IT and other back-office functions are Global Capability Centers (GCCs) and traditional IT outsourcing. While both have their merits, the choice between them depends on a company’s strategic goals, operational needs, and long-term vision. In this blog post, we will explore the differences between GCCs and traditional IT outsourcing, their unique advantages, and how to choose the right model for your business.  

 Understanding the Models: GCCs vs. Traditional IT Outsourcing

  Global Capability Centers (GCCs) are in-house units established by companies in strategic locations around the globe. These centers perform a wide range of activities, including IT services, research and development, finance, HR, and more. The primary focus of GCCs is on strategic functions and innovation, closely aligning with the parent organization’s goals and culture. They provide high control over processes and outputs, allowing companies to maintain direct influence on quality, innovation, and cultural alignment.   On the other hand, Traditional IT Outsourcing involves hiring external vendors to handle specific IT functions or other back-office tasks. This model is primarily cost-driven, with a focus on efficiency and cost savings. The scope of work is typically defined by service level agreements (SLAs) and contracts, which can provide predictable expenses but often result in limited integration with the client’s core business strategy.  

 Key Differences Between GCCs and Traditional IT Outsourcing

 

1. Strategic Control and Alignment:

– GCCs offer high strategic control, with companies having direct oversight of processes, quality, and innovation. This control facilitates a unified corporate culture and ensures that all operations are closely aligned with the organization’s overall strategy. – Traditional IT Outsourcing, however, involves shared control between the client and the vendor. While SLAs and compliance are crucial, maintaining alignment with the client’s corporate culture and strategic goals can be challenging due to the external nature of the relationship.  

2. Cost Efficiency:

– GCCs may require higher initial setup costs due to infrastructure investments and the establishment of new processes. However, they provide long-term cost benefits through process optimization, innovation, and better risk management. Companies that have set up GCCs often experience significant savings and value creation over time. – Traditional IT Outsourcing generally offers immediate cost savings, primarily through lower labor costs in regions with cheaper workforces. It also requires less capital investment upfront, making it an attractive option for companies looking for short-term cost reductions.  

3. Talent Management:

– GCCs enable companies to access global talent pools and customize training programs to align with specific company objectives. This approach often results in higher retention rates due to integrated career development opportunities within the company. – Traditional IT Outsourcing shifts the responsibility of recruitment and training to the vendor. While this can allow for rapid scalability, it may pose challenges in retaining specialized talent, especially if the vendor’s interests are not fully aligned with those of the client.  

4. Innovation and Agility:

– GCCs are deeply integrated within the company, allowing for direct involvement in strategic decision-making and fostering an environment conducive to innovation and agility. Cross-functional collaboration within the organization is often more fluid, enhancing the company’s ability to innovate and adapt to market changes. – Traditional IT Outsourcing relies on the vendor’s capabilities for innovation. While outsourcing can lead to efficiency, it might limit a company’s agility and responsiveness to market changes, as innovation is driven externally and may not be fully aligned with the client’s evolving needs.  

 Choosing the Right Model for Your Business

  The decision between establishing a GCC or opting for traditional IT outsourcing depends on several factors:   – Strategic Goals: If your company prioritizes strategic alignment, innovation, and long-term value creation, a GCC might be the better choice. GCCs provide a direct link to the company’s broader strategic goals and facilitate a unified corporate culture across global operations.   – Cost Considerations: For businesses looking for immediate cost savings and short-term flexibility, traditional IT outsourcing could be more suitable. This model allows for predictable expenses and requires less upfront investment, making it an attractive option for companies with limited capital resources or those seeking to manage costs tightly.   – Operational Flexibility and Scalability: GCCs offer greater flexibility and scalability in the long term, as companies have direct control over their operations and can adjust processes as needed. This adaptability is crucial for businesses looking to maintain a competitive edge in rapidly changing markets.   – Risk Management: GCCs provide better risk management capabilities by keeping core functions in-house and under direct control. This setup allows for more effective management of risks related to quality, compliance, and business continuity, which can be particularly important in highly regulated industries.  

 Real-World Success Stories

  Versitae and Systems Plus have successfully guided numerous global companies in setting up GCCs, particularly for global retail giants and organizations like Bright Horizons, DXL. These partnerships have enabled clients to achieve significant cost savings, enhance operational efficiency, and foster innovation. By leveraging deep expertise in GCC establishment and management, Versitae and Systems Plus have helped companies build resilient and scalable operations that thrive even in the face of economic challenges.   The success of these collaborations underscores the value that GCCs can bring to businesses looking to enhance their global operations and achieve strategic goals. Companies that partner with Versitae and Systems Plus benefit from tailored solutions that align with their unique needs, ensuring they maximize the advantages of the GCC model.  

 Conclusion

  Both Global Capability Centers and traditional IT outsourcing have their place in the modern business landscape. The right choice depends on your company’s specific needs, strategic goals, and long-term vision. GCCs offer strategic alignment, innovation, and long-term value, making them ideal for companies seeking to build resilient and adaptable operations. In contrast, traditional IT outsourcing provides cost-efficiency and flexibility, which can be beneficial for businesses looking for short-term solutions or managing immediate costs.   To make an informed decision, it’s crucial to understand your business’s unique needs and objectives. If you’re interested in exploring how GCCs can transform your business operations, enhance resilience, and drive innovation, contact Versitae today. Our experts will guide you in unlocking the full potential of GCCs and help you navigate the complexities of global operations effectively.    The GCC Advantage: Recession-Proofing and Driving ResilienceIn today’s rapidly changing economic landscape, businesses are continually seeking strategies to safeguard their operations and ensure resilience during economic downturns. One such strategy that has gained significant traction is the establishment of Global Capability Centers (GCCs). Formerly known as Global Captive Centers, GCCs are specialized units set up by multinational companies in strategic global locations to leverage local talent, enhance operational efficiencies, and drive innovation. In this blog post, we will explore the advantages of GCCs, particularly how they contribute to recession-proofing and driving resilience for businesses worldwide.  

The Rising Popularity of GCCs

  Global Capability Centers have emerged as a vital component of global business strategies, particularly for companies aiming to navigate economic uncertainties and capitalize on growth opportunities. The concept revolves around setting up dedicated hubs in talent-rich regions such as India, China, and Brazil, where the likelihood of a recession is significantly lower compared to Western economies. According to a Bloomberg report, the probability of a recession in India stands at 0%, while in China and Brazil, it is 12.5% and 15%, respectively. This contrasts sharply with the recession probabilities in the US (65%), the UK (75%), and Canada (60%).   This disparity in economic outlook highlights the strategic advantage of GCCs. By establishing centers in regions less affected by economic downturns, businesses can effectively diversify their operations and minimize the risks associated with a recession.  

Key Benefits of Establishing GCCs

 
  1. Access to a Diverse Talent Pool: One of the primary reasons companies establish GCCs is to tap into a diverse and skilled talent pool available in global hotspots. Countries like India and China are known for their vast pool of IT professionals, engineers, and other skilled workers. By leveraging this talent, businesses can innovate more rapidly, develop new products and services, and maintain a competitive edge in their respective markets.
 
  1. Increased Operational Efficiencies: GCCs enable companies to optimize their operations by centralizing key functions in cost-effective locations. This centralization leads to improved coordination, better resource allocation, and streamlined processes, ultimately resulting in increased operational efficiencies. For example, many companies have reported cost reductions of over 20% by consolidating operations in GCCs, which enhances their overall financial health during economic downturn.
 
  1. Enhanced Customer Experience: By setting up GCCs in different geographical locations, businesses can provide better customer support and services tailored to specific regions. This proximity to local markets allows companies to understand customer preferences better and deliver more personalized experiences, thereby enhancing customer satisfaction and loyalty.
 
  1. Flexibility and Scalability: GCCs offer companies the flexibility to scale their operations up or down based on market conditions. This agility is particularly crucial during a recession when businesses may need to adjust their operations quickly to respond to changing economic conditions. By having GCCs in multiple locations, companies can redistribute workloads and resources to regions less affected by economic downturns, thereby maintaining continuity and minimizing disruption.
 
  1. Boosted Innovation: GCCs are often established in innovation hubs, where companies can collaborate with local universities, research institutions, and startups. This collaboration fosters a culture of innovation and enables companies to stay ahead of the technological curve. Moreover, the diverse talent pool in GCCs brings fresh perspectives and ideas, driving innovation and creativity within the organization.
 

 GCCs as a Defensive Barrier Against Economic Downturns

In addition to these benefits, GCCs act as a defensive barrier against economic downturns. During a recession, businesses with operations concentrated in a single market are highly vulnerable to economic shocks. However, companies with a global footprint, supported by GCCs, are better positioned to withstand these shocks. By spreading operations across multiple regions, businesses can mitigate the impact of a recession in any single market and continue to operate efficiently.   Furthermore, GCCs enable businesses to achieve significant cost savings through lower labor and operational costs in countries like India and Brazil. These cost savings can be reinvested into the business to fund innovation, enhance product offerings, or expand into new markets, further strengthening the company’s resilience during challenging economic times.  

 Real-World Examples of GCC Success

Several multinational companies have successfully leveraged GCCs to enhance their resilience and drive growth. For instance, tech giants like Microsoft, IBM, and Google have established GCCs in India to tap into the country’s rich talent pool and innovation ecosystem. These centers have become critical to their global operations, contributing to product development, research, and customer support. By diversifying their operations through GCCs, these companies have managed to maintain steady growth and innovation, even during periods of economic uncertainty. Similarly, financial institutions such as JPMorgan Chase and Goldman Sachs have set up GCCs in India and other global locations to manage their back-office operations, risk management, and compliance functions. This strategic move has enabled these institutions to achieve operational efficiencies, reduce costs, and maintain a robust risk management framework, which is crucial during economic downturns. In addition to these global giants, Versitae and Systems Plus have played a significant role in setting up more than 20 GCCs, primarily for global retail giants and organizations like Bright Horizons, DXL, and more. These GCCs have been instrumental in providing specialized services, improving operational efficiency, and fostering innovation tailored to the unique needs of each client. The collaboration between Versitae, Systems Plus, and these organizations has helped build resilient and scalable operations that drive business success even in the face of economic challenges. By partnering with companies like Versitae and Systems Plus, businesses can leverage deep expertise and experience in setting up and managing GCCs, ensuring they maximize the benefits of this strategic approach to global operations. Whether it’s enhancing customer experience, streamlining operations, or driving innovation, these partnerships have proven effective in supporting companies in their quest for resilience and growth in uncertain economic climates.

 Conclusion

As businesses continue to navigate the complexities of the global economy, the establishment of Global Capability Centers offers a robust strategy for recession-proofing and driving resilience. By leveraging diverse talent pools, enhancing operational efficiencies, and fostering innovation, GCCs provide companies with the tools they need to thrive, even in uncertain times. As the likelihood of a global recession looms, businesses that have already embraced the GCC model are well-positioned to weather the storm and emerge stronger on the other side.   For companies looking to explore the benefits of setting up GCCs, now is the time to act. By strategically positioning themselves in global talent hotspots, businesses can not only safeguard their operations against economic downturns but also unlock new opportunities for growth and innovation. To learn more about how your company can leverage global talent hotspots and recession-proof your business through GCC setup, reach out to us.India’s GCC Revolution: Shaping the Global Business LandscapeIn recent years, India has established itself as a dominant force in the realm of Global Capability Centers (GCCs). Leveraging its vast talent pool and fostering a culture of innovation, India is transforming how global businesses operate. This blog explores the key elements driving India’s success in the GCC arena, the industries benefiting the most, major GCC hubs, future potentials, and the challenges and opportunities that lie ahead.   The Key Drivers of India’s GCC Success India’s ascent in the GCC sector is fueled by several critical factors:  
  1. Skilled Workforce: India boasts a highly skilled and diverse workforce, which is a significant draw for multinational companies setting up GCCs.
  2. Cost Advantage: The cost-effective environment in India allows companies to optimize their operations without compromising on quality.
  3. Innovative Ecosystem: A strong focus on innovation and technology adoption positions India as a leader in developing advanced solutions for global markets.
  Impressive Statistics The scale of India’s GCC operations is impressive. With over 1500 GCCs employing more than 1.3 million professionals, India has become an essential hub for global business services. These centers contribute significantly to the operational efficiencies and strategic capabilities of multinational corporations.   Benefiting Industries Several industries have harnessed the potential of India’s GCCs:
  1. Information Technology (IT) Services: Leading the charge with cutting-edge technological solutions and services.
  2. Banking, Financial Services, and Insurance (BFSI): Transforming financial operations and services through innovative solutions.
  3. Healthcare: Driving advancements in medical research, health technology, and patient care.
  Major GCC Hubs in India India’s GCC landscape is characterized by several key cities:
  1. Bengaluru: Often referred to as the Silicon Valley of India, Bengaluru is a hub for tech innovation and IT services.
  2. Hyderabad: Known for its rapid growth, Hyderabad is emerging as a significant player in the tech and GCC space.
  3. Pune: Gaining prominence as a preferred destination for setting up GCCs due to its favorable business environment.
  Future Potential The future of India’s GCCs is bright, with significant potential in several areas:
  1. Artificial Intelligence (AI) and Machine Learning (ML): India is at the forefront of developing AI and ML technologies, driving innovation and efficiency.
  2. Digital Transformation: Enabling seamless integration and operation of global business processes.
  3. Research and Development (R&D): Fueling the next wave of innovation and growth through robust R&D initiatives.
  Challenges and Opportunities Despite its successes, India’s GCC sector faces several challenges, including the need for continuous skill development and infrastructure enhancements. However, these challenges also present opportunities for growth, particularly in expanding into new industries and providing higher value-added services.   Conclusion India’s GCCs are not merely support centers; they are strategic partners driving the transformation of global businesses. As India continues to innovate and expand its capabilities, it is set to play an increasingly pivotal role in shaping the future of global business operations.  Leveraging Global Capability Centers (GCCs) to Build Resilient and Agile OrganizationsIn the face of today’s ever-evolving business landscape, characterized by economic uncertainty, geopolitical tensions, and disruptive technological advancements, organizations must adapt and innovate to stay ahead. One strategic approach gaining prominence in this context is the establishment of Global Capability Centers (GCCs). Formerly known as Global Captive Centers, GCCs are proving to be invaluable assets for businesses looking to future-proof their operations, drive innovation, and realize cost efficiencies. In this comprehensive guide, we delve deeper into the concept of GCCs, exploring their benefits, implementation strategies, and the transformative impact they can have on organizations of all sizes and industries.

Understanding Global Capability Centers (GCCs)

At its core, a Global Capability Center (GCC) is an offshore entity established by a company to leverage global talent pools for various functions, including IT, finance, customer service, research and development, and more. These centers serve as extensions of the parent company, providing specialized services while benefiting from lower operational costs, access to diverse talent, and favorable regulatory environments in offshore locations.

Embracing Globalization for Resilience and Growth

In an interconnected world where economic downturns and geopolitical uncertainties are commonplace, businesses are increasingly turning to globalization as a means of diversifying their operations and mitigating risks. By establishing GCCs in strategic offshore locations, organizations can tap into resilient talent ecosystems and shield themselves from the adverse effects of regional economic fluctuations. Moreover, GCCs enable companies to expand their global footprint, access new markets, and drive growth opportunities in a competitive landscape.

The Talent Advantage: Accessing Global Hotspots

One of the primary drivers behind the adoption of GCCs is access to a vast and diverse talent pool. Countries like India, the Philippines, China, Brazil, and Eastern European nations have emerged as key global talent hotspots, boasting skilled professionals across a wide range of industries and domains. By establishing GCCs in these regions, companies gain access to specialized expertise, language proficiency, cultural insights, and innovation capabilities that can fuel organizational growth and competitiveness.

Enhancing Operational Efficiency and Customer Experience

GCCs are instrumental in driving operational efficiency and improving customer experiences through streamlined processes, optimized workflows, and advanced technologies. By centralizing certain functions within GCCs, organizations can achieve cost savings, standardize operations, and scale resources more effectively. Additionally, GCCs enable companies to deliver enhanced customer service, leveraging multilingual support, round-the-clock availability, and personalized interactions to meet the evolving needs of global clientele.

Accelerating Innovation and Digital Transformation

Innovation lies at the heart of GCC strategy, enabling companies to stay ahead of market trends, disrupt traditional business models, and drive digital transformation initiatives. By tapping into global talent pools and fostering a culture of creativity and collaboration, GCCs become hubs for innovation, experimentation, and knowledge exchange. Through initiatives such as hackathons, innovation labs, and cross-functional projects, organizations can harness the collective expertise of their GCC teams to develop cutting-edge solutions and drive business value.

Realizing Cost Savings and Competitiveness

One of the most compelling benefits of GCC setup is the significant cost savings it offers. By leveraging lower labor costs, favorable tax regimes, and economies of scale, companies can achieve substantial cost reductions across various operational functions. Many organizations report cost savings of over 20% through GCCs, enabling them to reinvest resources into strategic initiatives, R&D efforts, and expansion opportunities. Moreover, these cost efficiencies enhance the organization’s competitiveness in the market, enabling them to offer competitive pricing, invest in quality improvements, and drive shareholder value.

Implementing GCC Strategy: Key Considerations

While the benefits of GCCs are undeniable, implementing a successful GCC strategy requires careful planning, collaboration, and execution. Some key considerations include:
  1. Strategic Alignment: Align GCC objectives with overall business strategy and long-term goals to ensure synergy and maximize value creation.
 
  1. Location Selection: Conduct thorough research to identify optimal offshore locations based on factors such as talent availability, infrastructure, regulatory environment, and geopolitical stability.
 
  1. Governance and Compliance: Establish robust governance frameworks and compliance mechanisms to ensure adherence to legal, regulatory, and ethical standards across GCC operations.
 
  1. Talent Management: Invest in talent acquisition, development, and retention strategies to build high-performing teams and foster a culture of excellence within GCCs.
 
  1. Technology Enablement: Leverage cutting-edge technologies such as AI, automation, analytics, and cloud computing to drive operational efficiency, innovation, and scalability within GCC operations.
 
  1. Risk Management: Implement robust risk management practices to identify, assess, and mitigate potential risks associated with GCC operations, including geopolitical, operational, and cybersecurity risks.
 

Conclusion: Unlocking Growth with GCCs

In conclusion, Global Capability Centers (GCCs) represent a powerful strategic asset for organizations seeking to build resilient, agile, and competitive businesses in an increasingly uncertain world. By tapping into global talent hotspots, driving operational efficiencies, accelerating innovation, and realizing cost savings, GCCs enable companies to navigate economic challenges, capitalize on growth opportunities, and drive sustainable value creation. As businesses continue to embrace globalization and digital transformation, GCCs will play an increasingly pivotal role in shaping the future of work and driving organizational success on a global scale.

Reach Out to Us

If you’re interested in learning more about how your organization can leverage Global Capability Centers (GCCs) to drive growth, innovation, and resilience, reach out to our team of experts. We’re here to help you unlock the full potential of GCC strategy and chart a course toward sustainable success in today’s dynamic business environment.Navigating Cost Efficiency in IT: The Strategic Role of Digital Transformation and Cloud Services

In the fast-evolving landscape of technology, Chief Information Officers (CIOs) are not merely stewards of IT infrastructure but strategic leaders driving digital transformation and innovation. Understanding the pivotal role of cloud providers in delivering cost-efficient services has become imperative for organizations aiming to stay competitive and agile.

Embracing Digital Transformation

Digital transformation is more than just a buzzword; it’s a strategic imperative for organizations looking to thrive in the digital age. CIOs recognize that embracing innovation is not an option but a necessity to stay relevant. This paradigm shift involves leveraging technology to streamline processes, enhance customer experiences, and drive overall business growth.

One key enabler of digital transformation is the adoption of cloud services. Cloud providers offer scalable, flexible, and cost-effective solutions that empower businesses to adapt to changing market demands swiftly.

The Cost-Efficiency Paradigm

Traditionally, maintaining on-premises infrastructure demanded significant capital investment and ongoing operational costs. The associated skills required for managing these systems added another layer of complexity and expense. Here, the strategic role of cloud services becomes evident.

Cloud providers offer a pay-as-you-go model, allowing organizations to scale resources up or down based on demand. This flexibility eliminates the need for large upfront investments in hardware and provides a more predictable cost structure. CIOs appreciate the agility and cost-efficiency that cloud services bring to the table, allowing them to allocate resources more strategically.

Data Center Exits and Cloud Migration

According to a recent CIO Pulse Survey 2023 of IT leaders, a striking 40% emphasized the critical importance of continued migration to the cloud and data center exits in the next 12 months. This highlights a collective recognition among IT decision-makers that reducing IT costs hinges on embracing cloud solutions and gradually moving away from traditional on-premises data centers.

Data center exits not only align with cost-efficiency goals but also reflect a broader industry trend toward leveraging the scalability and performance benefits offered by cloud providers. By entrusting certain functions to the cloud, organizations can redirect resources to core business activities, enhance innovation, and maintain a competitive edge.

Shifting IT Cost Paradigms

The cost implications of cloud adoption extend beyond the obvious operational advantages. With the cloud, organizations can benefit from regular updates and improvements to infrastructure without the burden of managing these upgrades internally. This dynamic shift in cost paradigms allows CIOs to focus on innovation and strategic initiatives rather than being bogged down by the intricacies of infrastructure maintenance.

Furthermore, the cloud facilitates a shift from a capital expenditure (CapEx) model to an operational expenditure (OpEx) model. This transition aligns IT costs with business outcomes, providing a more transparent view of how resources are allocated and enabling better budget management.

Leveraging Cloud for Innovation

Beyond cost considerations, CIOs recognize the intrinsic link between cloud services and innovation. Cloud providers offer a rich ecosystem of tools and services that empower organizations to experiment, iterate, and bring new ideas to the market faster.

The ability to access cutting-edge technologies, such as artificial intelligence, machine learning, and data analytics, via the cloud, enables businesses to stay at the forefront of innovation. CIOs understand that innovation is not only a driver of growth but also a means to differentiate their organizations in a competitive landscape.

Looking Ahead

As we navigate the ever-changing terrain of technology, it is evident that CIOs are steering their organizations toward a future where digital transformation and cloud services are not just advantageous but imperative. The strategic importance of these initiatives lies not only in cost reduction but in fostering a culture of innovation, adaptability, and sustained business growth.

In the coming months and years, we can anticipate a continued shift toward cloud-centric strategies, with organizations leveraging the expertise of cloud providers to enhance efficiency, reduce costs, and unlock new possibilities. For CIOs, the journey involves not just embracing technology but harnessing it strategically to propel their organizations into a future where innovation and cost-efficiency go hand in hand. Learn how we can help your organization navigate the digital skies with wisdom and foresight, ensuring a seamless journey toward innovation and success.

Optimizing Your Cloud Game One Step At A Time!

According to Gartner, IT spending backed by the cloud will cross $3.7 trillion in the next two years or so. While that’s a huge number it’s not that surprising. Ever heard of organizations taking up digital transformation without using the cloud? I surely haven’t. Everyone is understanding the true value of disruption, and technologies like AI and IoT are seeing increased consumer demand today. This means that the demand to leverage the cloud within organizations is also on the rise. Public cloud platforms like AWS, Microsoft Azure, Google and Alibaba Cloud have already made a mark for themselves in this rapidly changing technological landscape, and rightly so. They offer businesses a chance at better investment value, higher delivery speeds, increased agility, better storage options, and typically costs less. Works like a charm, right?

It sounds simple, but really, it isn’t. I’ll tell you why. Most businesses look at the cloud as one entity, but that’s not the case. The cloud is not just one platform. It is an integrated system of different hardware, software and logical links that work together to collate data and bring it to the end-user. Many organizations also feel that migrating legacy infrastructures on to the cloud may be a boon for them, and hence, rush into it. This is where they lose out.

Let’s talk about spend first. For example, AWS offers pay-as-you-use services along with easy scalability, which is a great or obvious reasons. You only pay for what you use, so spends are ideally optimized. But here’s the catch. Without technical experts on board, analyzing cloud costs to run a given service becomes difficult. You may end up paying for unneeded options, and forego ones that would actually be beneficial. Sometimes, cloud-service bills may also be vague, so you simply don’t get the data you need to understand what’s driving the spikes and dips in costs. Research says that almost half of compute resources that organizations sign up for are used for non-production purposes, and the majority of servers used for these functions only need to run during the typical 40-hour work week, not 24/7. If that’s the case, you may end up losing out on a lot of money!

Moving on to the utilization front, while a key advantage of moving to cloud is that you have unlimited capacity, enterprises often buy more capacity than they need, to ensure that they have enough resources to handle technological expansion. Then come applications. While planning computing resources, application owners will typically go by the data they have in hand from physical server days (because they don’t really have a precedent) as well as some assumptions around perceived business needs they see coming. And, since this estimation is made keeping in mind the worst disaster and the best growth scenarios, there is ample risk of over provisioning. In fact, no resource restriction actually serves as a motivator for over provisioning.

Published analysis suggests that in the current scenario, many organizations that take up cloud migration do not utilize more than 10 percent of its potential. The best case scenario is a utilization of 30 to 40%. Right Size Cloud Capacity is therefore a necessary consideration, if you really want to maximize cloud value.

So how do you make sure that your cloud resources are being utilized optimally?

A few critical things need to be kept in mind before taking this leap: how much are you spending now and hence willing to spend, how you will sustain peak efficiency with business drivers, and how will automation impact the day to day functioning of your organization?

The first step to solving the puzzle is to choose what kind of a cloud model you would want for your business. For eg: If you are a large scale multinationals, the hybrid cloud could be the most viable.  It gives you better flexibility in terms of deciding on the best combination of pay-per-use public cloud, private cloud and an on premise presence. For one, the migration itself becomes staggered and you get the space to decide on a pace, including, giving your internal team the time to come up the curve. To add to that, cloud automation and monitoring tools help you control extra costs and maximize resource utilization. For example: following the capacity versus utilization curve by AWS might be a good start for you to draw a parallel between your demands, budgets and the level of scalability that you are looking at for your business. This will also guide you to move from an infrastructural mindset to an overall IT centric approach.

All of this sounds easy on paper but when you start getting your hands dirty and implementing these changes, it can get really complicated. You can have all the tools and automated processes set in place, but if you don’t have a core, skilled team driving the move, it can very quickly turn into a veritable battleground. Yes, technology has overtaken every other industry with the pace at which it is evolving, but human learning and understanding is irreplaceable.

A lesson learnt in our three decades of experience within the traditional IT framework, with legacy systems, and now with the digital tech following a more agile development model. When it comes to the cloud there will always be difficult questions, but we have managed to answer them all, right from cloud architecture management, cloud migration to enterprise cloud solutions and cloud consulting. We’ve been helping our clients #GetITRight for decades!