The importance of cloud adoption for South African businesses

November 29, 2022

Between economic hardships, regular interrupted power supply, and frequent protests, businesses in South Africa certainly have their work cut out for them. These challenges impact businesses across the spectrum, from start-ups to SMEs to large enterprises. 

Cloud adoption and services are uniquely positioned to address these concerns, but also unlocks a world of business agility and innovation which, if adopted correctly, can help solidify and exponentially fast track business growth in South Africa.

What is cloud adoption in any way?

Hosting your IT infrastructure on well-known cloud hyperscalers, like Google Drive, Amazon, Microsoft or Oracle does not mean you have “moved to the cloud”. 

What it means, is that you are now simply hosting your business data centre with a different provider of a well-known brand. This is the equivalent to hosting your data centre with a range of infrastructure providers who rent out rack space with core services attached. 

With that said, there are immediate benefits (low-hanging fruit) of the original lift-and-shift approach that large corporations often take. For example, subscribing to reserved instances, (which realises immediate cost savings), leveraging the multi-region and multi-zone capabilities for backup and disaster recovery planning, and enjoying the incredible infrastructure uptime commitments from these large cloud service providers.

For large corporations it is important to understand that the initial cloud migration is not the end goal, but simply the first step. Once your production workloads run in the cloud, it is important to modernise your IT landscape to adopt cloud native best practices which will in-turn maximise the benefits of the cloud, far beyond simply lowering your existing IT operational costs. 

This brings us to another benefit of an “op-ex” centric cost model. Combined with modern DevOps and Cloud Engineering practises, using automated deployment pipelines and infrastructure-as-code, extreme business agility and innovation is unlocked. Cloud native businesses are no longer locked into static architectures. 

You can spin up IT infrastructure and deploy innovative business services, then simply decommission it as soon as the business experiment is concluded. Throughout, you only paid for the services used during the lifetime of the resources deployed! This is a major benefit which businesses often overlook!

So, embracing the cloud means updating your organisation’s operating model, including processes, systems, and technology, to embrace a cloud first approach. This includes cloud native services such as PaaS (Platform-as-a-Service) offerings, and not just SaaS (Software-as-a-service), but also adopting a dynamic architecture approach through operational automations, leveraging infrastructure-as-code and deployment pipelines both for infrastructure and line-of-business applications.

How cloud adoption cost structures can benefit your business

Cloud adoption effectively swaps capital expenditure on IT infrastructure for operational expenditure, based on services hired, whether it be infrastructure, platforms, or cloud native applications. 

On top of this, there are an abundance of free tier service offerings from each of the cloud providers. For smaller businesses, this means they can host their business services for little, or even no-costs!

 As your business grows, these free tiered offerings can be further maximised through a multi-cloud strategy which can exploit the additional discounted rates and offerings during the first year with a cloud provider. Innovative start-ups have avoided all cloud hosting costs for the first four years using this strategy!

As with any IT decision, there are both advantages and disadvantages of adopting an OpEx centric cost model. You need to ensure the benefits of cloud adoption supports your business and IT strategy and has a strong business case. 

One of the key considerations of how the cloud works is to understand that you need to actively monitor and manage your expenditure. Cost optimization is realised not only through right-sizing your resources, but also through employment of FinOps automations. Examples of this are automating the process, shutting down non-production workloads outside business hours, architecting your applications to support auto-scaling, and having a well-defined tagging policy which feeds into clearly defined budgets and alerts, according to business units.

How cloud adoption can protect your business

Hyperscaler service provider data centres need to adhere to extremely strict rules to ensure service uptime. This includes multiple local or private power sources, and strategically selecting physical sites to minimise environmental risks. 

With all the cloud providers, there is the concept of zones and regions (taxonomy may differ slightly between the cloud providers). A Region is a specific geographic (for example Cape Town, Johannesburg, London, Frankfurt). Within each region there needs to be deployed at least two (often there are three) Zones. 

A Zone is a physical data centre. Each Zone needs to be placed a significant distance from each other to mitigate risk of natural or man-made disaster (like protests, sabotage, or bombing). Most managed services have multi-zone replication built-in by default, but it is important to understand and take these factors into account when planning your cloud architecture. 

Planned correctly, your IT services will be highly resilient, easily weathering the natural and non-so-natural storms that our country can throw at your business!

So why adopt the cloud for your business?

Cloud adoption does not only protect businesses from catastrophic failures of IT backed business services and data loss, but also lowers the barrier to entry for low-income entrepreneurs and start-ups to gain access to enterprise level IT services at a fraction of the traditional costs. The cloud can scale with your business, offering a consistently excellent user experience, whether it is one user or a million users.

Regardless of business size, cloud services support your core business drivers by lowering operational costs, stabilising and creating predictable cash flow, protecting your gross-profits, and increasing your revenue.

Restack is a cloud and digital transformation partner, powering cloud adoption for Africa. 

For more information on cloud architecture, cloud solutions, cloud security or cloud managed services, contact us today!