Study on Cloud Migration: Expectation versus reality

Companies have high expectations of cloud migration, even when it comes to just getting started in the cloud: greater agility and lower costs are at the top of the list. The reality is different for many: Unrealistic cost estimates and unexpected complexity increase the time-to-value of cloud migration projects. For example, only 28 percent of companies say they have already comprehensively integrated cloud infrastructures into their companies.

The most important results at a glance:

• The majority of companies describe migration to the cloud as a "crucial" or "very important" project in their annual strategic planning
• Although the journey to the cloud takes longer than two years for many companies, 40 percent underestimate the cost of migration
• 74 percent of companies only discover during migration that they lack the necessary internal knowledge
• Only 28 percent of respondents say that the cloud is comprehensively integrated in their company

71 percent of business and IT decision makers surveyed in the UK, France, Germany and the US have been migrating to the cloud for more than two years. For 80 percent of business leaders, migration to a public or private cloud environment remains a "critical" or "very important" project in their planning for the next twelve months. Jens Puhle, Sales Director Germany at Rackspace, says: "The cloud is the driving force behind digital transformation: it makes innovative business models possible and companies can reduce costs at the same time. The only thing is that most companies are not aware of the challenges that come with migrating to the cloud."

Cost planning

Half of the business and IT decision-makers see significant cost reduction as the main driver for cloud adoption. In contrast, 40 percent of companies say that the costs of cloud migration are still higher than expected, even after several years. The biggest discrepancy was in upgrading, consolidating and/or replacing existing business applications and systems. Here, 40 percent of respondents described the costs as higher than expected.

Complex migration

The survey also found that companies had massively underestimated the scope of the migration in advance. They were apparently unaware of a number of technical as well as other internal obstacles: During the planning and execution phase, the biggest challenges were the capture, cleansing and governance of data assets (40 percent), followed by process management in the cloud (34 percent) and the definition of a targeted strategy.

When asked about the biggest challenges, during and after migration, 77 percent cited poor user training, cultural resistance to cloud migration, and inadequate change management programs as the biggest obstacles (44 percent, 37 percent, and 36 percent, respectively).

Plan and implement strategy with partners

58 percent of respondents identify the lack of a focused strategy as a problem before and during migration to the cloud. For good reason: companies need a clear strategy that links business and IT. In this way, they minimize the obstacles on the way to the cloud and reap the benefits of cloud systems more quickly. Those who start the journey to the cloud without external partners will face even greater obstacles. A large proportion of respondents are aware of this situation: for example, 77 percent already value service partners as support when it comes to setting up workflows that help them implement their cloud strategy. When asked what they would do differently in retrospect, 51 percent would hire experienced cloud experts for migration projects today.

Thinking about cultural change

"When it comes to introducing new technologies, today's generation of entrepreneurs is acting faster and faster. The only thing is that many fail to correctly assess the requirements of the technology and, above all: to know the limits of their own company. As always, when people, processes and new technologies are supposed to work together, challenges arise. This also applies to the entry into the cloud. Closing the gap between expectation and reality at this point plays a major role in the success of the program. Companies should therefore critically examine both their technological status quo and their attitude towards change. Only then can we begin to reliably forecast costs and complexity," Puhle continues.

About the study

For the survey, Forrester asked 326 companies in the UK, France, Germany and the US about their experiences migrating to cloud environments. Both business and IT decision makers participated in the survey. Download the full study here.