AWS Cloud Enterprise Strategy Blog

Taking charge: Cloud-Enabled Insourcing as a Digital Strategy

by John Brigden, VP of AWS Managed Services
Introduction by Mark Schwartz

In the digital world, speed is all-important. Short lead times allow companies to get products to market faster; build their products in fast, low-risk increments that incorporate customer feedback; respond quickly to disruption; and reduce risk through rapid customer testing and timely response to security threats. But enterprises with a large legacy estate—especially systems that are not strategic and do not provide them with competitive differentiation—may find themselves held back from moving into the digital world as they spend valuable time trying to learn to operate those legacy systems in the cloud.

In this article, John Brigden, VP of AWS Managed Services, shows how working with a Managed Service Provider like AMS can speed up the migration to the cloud, introduce best practices for operating and securing these legacy systems, and free up the enterprise to focus on the IT capabilities that really differentiate it. The key is to carefully consider what to insource and what to outsource. When the right balance is struck, the enterprise can avoid spending time on those “run the business” workloads and instead direct their resources to innovation and strategic capability-building.

Mark


Taking charge: Cloud-enabled insourcing as a digital strategy

by John Brigden,  VP of AWS Managed Services

For years, businesses have outsourced their IT environment as much as possible—from infrastructure to support to application management. It wasn’t viewed as differentiating their core business and, as a result, was managed as a commodity operational cost of the business.

Digital transformation puts a new spin on things. Leaders today are looking to their IT estate and digital assets to help them drive value and differentiate their businesses. For many, the risk of being disrupted by a digital-native business also shapes their strategy. Moving to the cloud can empower business and technology professionals to focus on these areas. Cloud-enabled IoT, machine learning, blockchain, and other new technologies enable organizations to create unique offerings and experiences faster than ever before.

However, many traditionally outsourced organizations find it difficult to regain the control and speed needed to transform their IT environment when they move to the cloud. They find themselves still mired in the tedious labor associated with managing infrastructure, which prevents them from focusing on value-added activities. The ability to focus on areas with the greatest leverage is critical, because few organizations can afford to dramatically increase IT headcount, and skilled cloud professionals are in short supply.

For these reasons, many organizations are deciding to “insource” aspects of their IT estate that have the biggest impact on their business. A powerful approach to cloud adoption is to use managed solutions to gain a head start on innovation, while insourcing areas where the enterprise wants to focus on true transformation. Doing so offers the opportunity to standardize and automate infrastructure management, putting limited resources and people with hard-to-find skills to work on strategic activities.

Moving the cloud in a way that enables strategic insourcing requires rethinking IT operations across people and technology—and choosing the right partners to handle the aspects of infrastructure that have high stakes and low rewards. The decision is no longer whether to use expensive in-house IT resources or cheap offshore ones to keep the lights on. It’s how to minimize the time and cost associated with undifferentiated work to liberate IT talent to focus on innovation.

Rethinking operations

When considering what to insource, decide what differentiates your digital business and automate or outsource the rest. Networking is an example of an operational task that rarely adds much value yet is essential to the smooth functioning of your cloud environment, where networks underlie every activity. Errors in mundane tasks, such as managing IP addresses, ports, network connectivity, and access control, can lead to costly problems. The proliferation of settings can also make it difficult to enforce security and operational controls, and can complicate routine activities such as patching and backup. It’s the kind of high-stakes, low-reward work that benefits from automation and standardization, using approaches such as infrastructure as code.

Alert management and response can also create overwhelming challenges when approached with a traditional mindset. The interconnected nature of cloud services can dramatically increase alert volumes, especially when using large numbers of microservices or when alert rules are poorly tuned.

Organizations need solutions for intelligently correlating alerts to discover and mitigate real incidents. Such solutions help operations professionals focus on activities that optimize the digital estate, safely ignoring irrelevant data while discovering the alarms most likely to cause an outage.

If you’re looking to outsource functions such as these, look for providers who take a cloud-first approach, using automation and data to create efficiency. If they’re just throwing human labor at the problem without changing how they operate, they’re only going to slow you down. Another option is to work with Amazon Managed Services (AMS) for the initial setup of infrastructure as code, intelligent alerting, and other cloud ops fundamentals. Your IT professionals can take over maintaining these systems if desired, as they will be much more efficient and take less of their precious time.

Prioritize transparency

Moving from on-premises infrastructure to the cloud is already challenging. Outsourced infrastructure limits visibility and control, adding to the difficulty. This transition presents an opportunity to free yourself from the “black box” management style of traditional outsourcing.

By adopting open toolsets that deliver end-to-end visibility into your environment, you can stay on top of what’s going on with your infrastructure and capture data to help you optimize. Your team doesn’t have to manage everything, but they should be able to see everything. Having toolsets in common with vendors and partners puts everyone on a level playing field. This kind of transparency gives you control and decision-making power, which is essential when insourcing valuable IT functions.

Taking control also means a shift in security and access management. Traditional, centralized IT prioritized security and control over speed and flexibility. Outsourced IT could exacerbate this problem by adding layers of bureaucracy to the system. The predictable result was massive growth in shadow IT. Cloud-native, role-based solutions such as AWS Identity and Access Manager (AWS IAM), Amazon CloudWatch, and Amazon CloudTrail work together to enable enterprise governance and security with appropriate flexibility and control for users. They let you empower people to innovate and optimize safely and securely.

Accelerate automation with the right partnerships

Once low-level tasks are automated, your team doesn’t have to think about them as much. But getting there can be challenging. It takes time and crosses several technical domains that application developers traditionally relied on centralized IT to manage. It’s also not the kind of work that keeps cloud-savvy IT pros engaged. Achieving highly streamlined and automated infrastructure operations allows them to focus on the hard problems—crucial for retaining them and making the most of their skills.

Unfortunately, the labor-centric model of traditional outsourcing works against these benefits, even in a cloud environment. It doesn’t matter whether your partners are traditional outsourcers, system integrators, or cloud managed services. Their business models must align with your digital strategy and not introduce unneeded complexity that slows you down. They should be obsessed with the success of your strategic business outcomes in the cloud—not just keeping the lights on. Finally, they need to demonstrate a passion for teaching and empowering your people to learn the technology and solve business challenges.

Focus on innovation

Ideally, the decision to insource or outsource a given function should be based on whether that function drives innovation. Every business needs to move faster. IT must transform from anchor to engine. The cloud offers new ways to draw the line between commodity, value-added activities, and new approaches to driving value. Skill and creativity matter more than ever. The crucial decision is how to give your most talented people the right levers to effect powerful change.

Learn more about how AWS Managed Services can help you automate the mundane and insource innovation.

 

John Brigden is General Manager and Vice President of AWS Managed Services (AMS). AMS helps Enterprises adopt AWS at scale by providing an end-to-end well-operated experience on AWS.

 

Mark Schwartz

Mark Schwartz

Mark Schwartz is an Enterprise Strategist at Amazon Web Services and the author of The Art of Business Value and A Seat at the Table: IT Leadership in the Age of Agility. Before joining AWS he was the CIO of US Citizenship and Immigration Service (part of the Department of Homeland Security), CIO of Intrax, and CEO of Auctiva. He has an MBA from Wharton, a BS in Computer Science from Yale, and an MA in Philosophy from Yale.