While cloud has become the new normal for organisations of all sizes, many IT executives and budget owners continue to struggle to articulate the business value of moving to the cloud in terms that resonate with the board and c-suite. In this session, we will walk through the impact of cloud computing on the overall IT cost base. We will also cover what the typical non-cost benefits are, and how they can be measured and communicated. Finally, we will provide an overview of the tools and support to help you on the journey.

1. S U M M I T
SYDNEY

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Building the business case for
migrating to AWS
Sudith Devan
ANZ Business Value Lead
Amazon Web Services

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baseline

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Customers move to AWS for multiple reasons…
Data Center
Consolidation
Acquisitions
or Divestitures
Large scale compute
intensive workloads
Facility or
Real Estate decisions
Agility/Dev
Productivity
Cost ReductionInnovation &
Digital
Transformation
Colocation or
outsourcing contract
changes
Data Center
Consolidation
Acquisitions
or Divestitures
Large scale compute
intensive workloads
Facility or
Real Estate decisions
Agility/Dev
Productivity
Cost ReductionInnovation &
Digital
Transformation
Colocation or
outsourcing contract
changes
Data Center
Consolidation
Acquisitions
or Divestitures
Large scale compute
intensive workloads
Facility or
Real Estate decisions
Agility/Dev
Productivity
Innovation &
Digital
Transformation
o
Data Center
Consolidation
Large scale compute
intensive workloads
Facility or
Real Estate decisions
Cost ReductionInnovation &
Digital
Transformation
Colocation or
outsourcing contract
changes
Data Center
Consolidation
Acquisitions
or Divestitures
Large scale compute
intensive workloads
Facility or
Real Estate decisions
Agility/Dev
Productivity
CInnovation &
Digital
Transformation
outs
Data Center
Consolidation
Acquisitions
or Divestitures
Large scale compute
intensive workloads
Facility or
Real Estate decisions
Agility/Dev
Productivity
Cost ReductionInnovation &
Digital
Transformation
Colocation or
outsourcing contract
changes

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Their experiences helped us create a value framework
Cloud value framework
Cost savings (TCO)
Cost impact
Business agility
Business value impact
Staff productivity Operational resilience

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The economics of cloud are real
Infrastructure cost $
Time
Large
capital
expenditure
Opportunity
cost
Predicted demand
Traditional hardware
Actual demand
AWS
Key:
Lost
opportunity

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There are many factors that help customers
achieve cost savings on AWS
Source: IDC Whitepaper, sponsored by Amazon, “Fostering Business and Organisational Transformation to Generate Business Value with
Amazon Web Services” February 2018
Pricing model choice
to support variable &
stable workloads
On-Demand
Reserved
Spot
1
Save more money
as you grow bigger
Tiered pricing
Volume discounts
Programs
4
72 Price
Reductions
Economies of
scale allow AWS
to continually
lower costs
3
“51% lower cost
of operations”
Remove over
provisioning and pay
for what you need
2

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There are many factors that help customers
achieve cost savings on AWS
Source: IDC Whitepaper, sponsored by Amazon, “Fostering Business and Organisational Transformation to
Generate Business Value with Amazon Web Services” February 2018
Pricing model choice
to support variable &
stable workloads
Save more money
as you grow bigger
On-Demand
Reserved
Spot
Tiered pricing
Volume discounts
Programs
1 4
72 Price
Reductions
Economies of
scale allow AWS
to continually
lower costs
3
“51% lower cost
of operations”
Remove over
provisioning and pay
for what you need
2

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Lever 1: Lever 2: Lever 3:
Pick the right
pricing model
Right size your
resources
Introduce
elasticity
What does that mean for you?

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Lever 2: Lever 3:
“Right-size” your
resources
Introduce
elasticity
What does that mean for you?
Example

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Lever 3:
Introduce elasticity
What does that mean for you?

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How does that impact your business case?
100%
40-50%
30-40%
20-30%
1 2 3 4

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How does that impact your business case?
100%
40-50%
30-40%
20-30%
1 2 3 4

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100%
40-50%
30-40%
20-30%
1 2 3 4
How does that impact your business case?

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How does that impact your business case?
100%
40-50%
30-40%
20-30%
1 2 3 4

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Staff productivity
Source: n = 500 AWS Customers. AWS Cloud Economics Benchmarking, August 2018.
Cloud improves efficiency… This value accelerates with AWS maturity
2x
Increase in # of VMs
managed per admin
3.2x
Increase in # of TB
managed per
admin over time
1.8x
Increase in # of TBs
managed per admin
3.3x
Increase in # of VMs
managed per admin
over time
VMs managed on-prem vs. cloud TB managed per administrator TB managed over timeVMs managed over time
On-premises In cloud On-premises In cloud 1–2 years on AWS 3+ years on AWS 1–2 years on AWS 3+ years on AWS
Source: n = 500 AWS Customers. AWS Cloud Economics Benchmarking, August 2018.
Customer benchmarking insights

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Staff productivity example: server administrator
Server Budgeting &
Planning
Server purchasing process Long term capacity
planning
90% 75% 75%

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Software changes Server purchasing process
Hardware repair in occasion
of failure
50% 75% 100%
Staff productivity example: server administrator

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Staff productivity example: server administrator
Software changes Hardware purchasing
Hardware repair in occasion
of failure
50% 75% 100%

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Software changes Hardware purchasing Hardware failure
50% 75% 100%
Staff productivity example: server administrator

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Operational resilience
Customer benchmarking insights
Source: n = 500 AWS Customers. AWS Cloud Economics Benchmarking, August 2018.
# of total monthly incidents
43.4%
Reduction total
monthly incidents
Before AWS After AWS

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Every minute of downtime has a
material impact
on your business

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Operational resilience
Cost of downtime and security of incidents
Annual Fortune
1000 application
downtime costs
(IDC)
$1.25 to
$2.5B
Average cost of a
data breach
(Ponemon
Institute)
$3.6M
Cost/hr of a
critical
application
failure (IDC)
$500K to
$1M
Average cost/hr
of downtime
(Ponemon
Institute)
$474K
Average cost per
lost or stolen
record (Ponemon
Institute)
$141

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Business agility
With AWS, you can
innovate faster while
reducing failure costs

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Business agility
AWS benefits
Traditionalsoftware delivery lifecycle and
average % of time spent at each step *
* Meta Group / Gartner research
Simplify requirement design
Increase the speed
Eliminate deployment “wait time”
15%Design
23%Build
17%Integration & Test
22%Requirements & Analysis
12%Deploy
11%Maintain Reduce maintenance cost

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Organisations have achieved
real and tangible outcomes with AWS
across all these pillars

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Case study

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Case study: Globe Telecom
Scale of usage
2,600+ 7.5+ PB

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Case study: Globe Telecom
Benefits Realised
30%
TCO savings
15x
increase in
app
performance
99.99%
uptime
3 months to
2 days
reduction in
provisioning
times

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Analysis approach
First call Data gathering
Executive
presentation
Analysis
Refinement

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33. TSO Logic quickly delivers an optimised business case for AWS
It enables business and IT leaders to:
Determine the most cost-effective path to cloud
Maximise Microsoft licenses for even bigger savings

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Resources to get you started
AWS TCO Calculator
https://awstcocalculator.com
AWS Economics Center
aws.amazon.com/economics/
Case Studies and Research
aws.amazon.com/solutions/case-studies
Value Realisation Studies
Available now

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Key learnings
• The AWS business case is your baseline
• Cloud is a commercial transition: move from “pay for
what you have” to “pay for what you need”
• There’s more to the business case than cost savings

37. Thank you!
S U M M I T © 2019, Amazon Web Services, Inc. or its affiliates. All rights reserved.
Sudith Devan