Building a business case to modernise your legacy data platform

I often talk to both existing clients and prospective clients who have a legacy on-premise data platform in place and are seeking to migrate to a modern cloud data platform architecture. During these discussions, I typically get asked questions around the approach for a modernisation initiative and the associated costs. In this article, I share my thoughts around the different approaches that technology / data & analytics leaders can take to secure funding for legacy to cloud data platform migrations.

Before I delve into these approaches, let me clarify what I mean by modernisation. In my opinion, lifting and shifting the existing solution into a cloud infrastructure as a service (IAAS) solution (e.g. running the same stack in cloud VMs) is not enough. To take advantage of the benefits of the cloud such as cheap storage, pay-as-you-go compute, scaling up and down on demand and the latest analytics capabilities, a proper re-platforming is almost always required. As part of the re-platforming, the legacy data models and associated business logic often need to be migrated to the cloud platform (something that Altis can help you achieve with our ALTIDA Data Load Accelerator framework).

“Tech for tech” migration

This is the most common approach that I see and it involves building a business case for the migration by focusing on the technology pain points. These usually include the following:

• The legacy technology stack is reaching end of life and becoming increasingly difficult to support and maintain. Often, the stack will either soon be (or may already be) out of support with the legacy software vendor(s).
• Further to the above, retaining existing resources (or finding new ones) with the required skills to operate and maintain the legacy solution is also challenging and with some stacks (e.g. SAP), can be very costly.

The main issue with this approach is that the financial benefits associated with the above usually don’t stack up against the re-platforming costs, especially if external specialist assistance is required. For a “tech for tech” migration to be viable on its own, one or more of the following is usually required:

• Resolving the technology pain points is a necessity to mitigate risk associated with critical functions that the legacy data platform may perform. For example, it could be generating mission-critical reports or outputs relating to core revenue-generating functions or required to meet regulatory compliance.
• There are highly skilled in-house resources who can assist in performing the migration progressively over time while juggling BAU activities (and they might be partially or fully funded under OPEX buckets which reduces the amount of CAPEX funding required).
• There may be some partner funding available from the cloud vendors to offset a small portion of the migration costs (depending on the level of spend by the organisation with these vendors).

Riding the business transformation wave

When an organisation embarks on a business or digital transformation program, this oftens presents an excellent opportunity to execute the data platform modernisation program at the same time. There are compelling reasons why this approach should be taken if an organisation has started the business transformation journey:

• If one or more core operational systems are being retired as part of that program and new systems are being introduced, the impact to the legacy data platform is likely to be high, with a significant amount of effort required to just interface with the new systems.
• Most transformation programs are not just changing operational systems from a technical perspective but business processes are also being re-engineered. This means that the data models on the data platform also require changes, along with the business logic that populate these models. And these changed data models mean that all downstream reporting & analytics also need refactoring.

Based on the above, the business case to modernise the data platform as part of the business transformation is usually a no-brainer because the organisation will most likely need to rebuild most of the existing data platform anyway.

New high-value use cases

If a “tech for tech” business case doesn’t stack up on its own and there is no broader transformation program in sight to leverage, then the only other approach remaining is to identify one or more high-value use cases which are not yet implemented on the legacy platform. Including such use cases in the migration business case can introduce the additional quantitative benefits required to make it financially viable. However, this is often easier said than done and often requires the things below to happen:

• Finding these use cases can be challenging. It requires data & analytics teams to step out of the technology space and partner with business units, understand what they are doing to meet their strategic objectives, what challenges they are facing and how data & analytics can assist in accelerating the delivery of these objectives. As one of my long-term clients, a seasoned data & analytics executive, often puts it: “To be successful in the data space, you need to understand the business better than the business.”
• Once the use cases are identified and understood, the business needs to be convinced to firstly make the investments to fund the use case delivery and secondly, once these are delivered and operational, to be accountable for utilising the solution to realise the benefits. This requires the data & analytics leader to secure proper c-level sponsorship and when given the funds to execute, ensure that solution delivery is coupled with strong business engagement as well as adequate change management.

For data & analytics teams who are struggling to achieve the above using internal resources and capability, it is worth seeking external help and engaging consultants who can bring their experience and expertise across all of the different approaches mentioned. At Altis, we have successfully executed many such legacy to cloud data platform migrations. Furthermore, our deep experience across several industry verticals also allows us to help with the identification, grooming and delivery of these new high-value use cases.

So, if you’re currently considering a business case for migrating your legacy data platform to the cloud and need help, please connect with us and start the conversation on how Altis can help you.