Darren Deehan ponders when is the right time for you to abandon your on-premises applications.
Do you recognise this scenario?
You are the Operations Manager of a growing business or organisation and you have been writing business cases and lobbying the directors for approval to invest in a new application that will dramatically improve efficiency and profitability. You took great satisfaction in finally winning the support of your colleagues to proceed with a product selection process.
After months of lengthy discussions with stakeholders and input from concerned IT colleagues, it has been agreed (reluctantly by you, of course) that an RFP process would get the best result and the best deal for the business.
Now it’s 18 months in and the vendor has been selected, some of the people involved in the initial requirement building have moved on, but expectations of the success of this deployment are huge. The chosen vendor was not your first or even second choice and your initial enthusiasm has waned because of all the internal politics and you worry that the failure of this implementation will be blamed on you.
Regardless of your trepidation and stress, the implementation goes ahead, granted way over budget and 24 months after your initial suggestion that this was an urgent requirement. The first results are fairly positive, and after another 3 months of training and hardware conflict issues, it settles down and you begin the 3-year ROI cycle that has been demanded by the Finance Director.
Now it is 3 years since you originally proposed this new application. Year 1 of using the system is over and the first annual maintenance payment is due.
You have 2 more years to make the targets for the original business case. After a long and tedious IT implementation process, lots of project meetings and a couple of escalations with the vendor, the system is starting to deliver benefits. With a following wind you will deliver the ROI that you promised. So what’s the problem?
You read on an industry e-zine [We hope this was Call Centre Helper – Editor] about a vendor you spoke to some 3 years ago. They have since launched an application in the cloud and the costs are broadly similar to your annual maintenance but continuous functionality improvements, zero-effort updates and guaranteed uptime put the cloud application far ahead of the system you laboured so hard to implement.
With the cloud application, employees can even ‘Bring their Own Device’ (BYOD) to the office and you don’t need to worry about compatibility with your 6-year-old network.
You can see a huge win from one component alone within the cloud application. To switch to the cloud application would have a neutral cost implication, yet because of the sunk cost in on-premises kit that is not yet written off, your suggestion to switch will get a frosty reception from the FD.
Which is the smarter business decision?
- To run with an outdated, sub-optimal solution just to satisfy a historic business case?
- Or, to be agile, leverage innovation, cut your losses and leap ahead of your competitors?
Cloud applications enable business people to identify and deploy the best application for their operation, at low cost and with low risk.
And because you don’t need to make a big capital investment or enter a multi-year agreement, you can switch at any time without major disruption. The cloud vendor has a vested interest in keeping you happy.
Darren Deehan
On the other hand, your on-premises supplier solution may work for now, but since the vendor received a big upfront payment for software licences, they have a limited incentive to innovate.
There is a strong argument to conclude that on-premises applications are now too much of a risk for any organisation. It is no surprise that sales of cloud applications are growing exponentially; it’s time to move on from the old ways of procuring software.
With thanks to Darren Deehan at injixo
Author: Megan Jones
Published On: 17th Dec 2014 - Last modified: 22nd Mar 2017
Read more about - Archived Content, Peopleware
