ISACA White Paper lists 5 Hidden Costs of Cloud Migration

Grazed from MarketWatch. Author: PR Announcement.

Cloud computing promises low cost of entry and fast return on investment, but that ROI can fall short of expectations if hidden costs are left out of the equation. A new white paper from global IT association ISACA, "Calculating Cloud ROI: From the Customer Perspective," shows the true costs of cloud migration and offers a practical framework for calculating ROI.

The free paper outlines five hidden costs that enterprises may not anticipate when moving to cloud-based services:

— Bringing services back in-house due to stricter data privacy laws

— Implementing measures to mitigate risk…

— Initial migration of systems

— Loss of internal IT knowledge providing competitive differentiation

— Lock-in with cloud provider

"Cloud computing makes it easy to offer the same self-service that people love when they turn on their lights or air-conditioning–it’s on-demand and pay as you go," says Marc Vael, CISA, CISM, CGEIT, CRISC, international vice president of ISACA. "In reality, cloud computing is like every other innovation. Security, cost and complexity don’t disappear — they just need to be managed and accounted for."

Enterprises are achieving benefits by shifting cost from capital to operational, becoming more agile, and redeploying IT resources. This guidance from ISACA details a 12-step process that looks at the complexity of cloud computing options and the importance of making informed decisions about long-term costs and payback.

An example of positive ROI as a result of cloud migration is CA Technologies, which uses a private cloud to enable resource pooling and on-demand and scheduled resource acquisition, and to support data center consolidation and standardization.

"Early in our deployment we consolidated 44 locations and drove millions in real estate savings and in productivity gains, as well as a 25% reduction in budget," said George Watt, vice president of strategy, CA Technologies, who led the cloud deployment. "Yet, our newfound agility was the unsung hero. One of the most important steps in calculating ROI is ensuring second-order costs are considered so there is a legitimate understanding of the complete cost."

To effectively calculate ROI for cloud initiatives, the "Calculating Cloud ROI" white paper offers practical tips:

— Balance the need to be accurate with the need to reach a decision.

— Be aware that cloud is not right for every organizational need.

— ROI is a good start, but ensure that other financial indicators are calculated as well.

— Remember that it is far easier and less costly to change a decision when it is still on the drawing board.

"Calculating Cloud ROI: From the Customer Perspective" is available as a complimentary download at www.isaca.org/cloud-ROI .