Banks and financial institutions have a number of options to choose from when deciding which cloud migration strategy to adopt. How institutions make their decision will depend on a series of factors which should be considered as part of a formulated migration strategy. This strategy must establish core business requirements and goals, business constraints and a list of cloud options available. The most important factors that will influence this decision will be cost, time, and appetite for risk but also the level of knowledge and experience of cloud technology inside of an organization.
The following options are valid whether your organization is considering using single or multiple cloud providers. Using multiple cloud providers can reduce single vendor risk but introduces additional complexities.
The simplest migration option available is the hybrid model and involves a partial migration to the cloud, usually for a subset of non-functional requirements (e.g. archiving, backup, disaster recovery, etc.). In this model, the on premise application remains active; therefore this would not be considered a full migration. This option can achieve some infrastructure savings and leverage basic cloud infrastructure services by reducing the need for large storage or stand-by servers on-premises. This strategy allows your organization to start “testing the waters” and begin getting comfortable with your chosen cloud provider.
Another migration option available is rehosting also known as “lift and shift”. This involves the redeployment of the application from on premise to a cloud infrastructure. Rehosting saves time and money by replicating applications in the cloud. It allows for configuration changes to take place without rewriting the application code. It is ideal for organizations wanting to migrate quickly. However, rehosting will not leverage all the advantages offered by the cloud provider. If rehosting is done without changes to application architecture, the scalability benefits may not be seen and experienced.
A more resource-intensive option is refactoring. This involves the re-writing of applications that would run on the cloud provider’s infrastructure. Refactoring allows a business to take full advantage of the cloud’s infrastructure. The ability to add features and improve performance and scale are enhanced, which are difficult to achieve in the existing environment. These business benefits are what make refactoring an appealing option. However, the time, cost, and risk of refactoring are higher. This migration strategy requires good experience and familiarity with the cloud. Re-writing application code to connect the application to the new infrastructure requires firm knowledge and expertise in what an application is doing.
Yet another possible strategy is repurchasing. Repurchasing involves a move to a different product, such as buying an application from a SaaS (software as a service) vendor. This is a relatively low-risk approach that is recommended when there is a package on the market that offers a good functional match at an acceptable price.
When considering the options for migrating applications to the cloud, banks and financial institutions should consider which platform and migration techniques offer them the best chance to optimize applications that support business and IT goals.
Time, costs, and resources are the three crucial factors when it comes to deciding which migration strategy should be adopted. Of the various options, refactoring is the most strategic option available. As this requires re-writing an application it will allow you to leverage the cloud to the fullest though implementing such a strategy comes with risks. With this important factor to consider, hybrid and rehosting provide more tactical and lower risk options for organisations seeking a quick migration process.
These options are not exclusive. Yet another valid alternative could be to start with hybrid as a sort of PoC (proof of concept), then evolve into rehosting in the interim, and finally into refactoring for the longer term. This would allow for a gradual build-up of cloud skills and expertise and confidence in the organization at the expense of time and costs.
There is no one right answer. The right choice for your institution will depend on how effective a migration strategy and framework is developed and implemented. It will allow for an analysis and evaluation of the business needs, capabilities, and timeframes. GFT has a breadth of experience with each of these migration strategies and can help you identify the best approach for your organization.