Cloud for Core Enterprise Applications

Making a Successful Move to the Cloud for Core Enterprise Applications

The cloud architecture makes a difference for core enterprise applications strengths and migration success.

Where Do Core Enterprise Applications Belong?

IT leaders are caught in a dilemma when it comes to deployment of core enterprise applications. One side is continuing the expensive and time-intensive effort to maintain and adapt legacy applications, even though it seems they increasingly hinder business activity rather than help it.

The other side is adopting new applications that run in the cloud—an environment that offers promising potential, but is also unfamiliar and may be perceived as risky.

Until recently, enterprises used the cloud only for new applications or for those specific to an individual department or business unit. Now, with the growing strength of cloud application offerings, enterprises are starting to consider replacing the core enterprise applications traditionally hosted in on-premises systems and put those in the cloud, too.
The success of any move to the cloud depends in part on the architecture that underlies the cloud service or application. When looking at potential cloud solutions for core systems, it is important to understand the different cloud architectures and how they impact application capabilities and performance—and the difference that makes for migration from current systems.

How Today’s Cloud Offerings Address IT Concerns

There are many reasons why IT organizations have been cautious in the past about making the switch to cloud for core applications. Yet the benefits of today’s cloud offerings mitigate those concerns.

Existing systems. Initial resistance to cloud adoption often comes from the idea of abandoning large investments in
existing systems. Many core enterprise applications encompass years of expense, staffing, data center infrastructure,
user training, and a CIO’s internal political capital.

This level of investment can make it hard to embrace a complete replacement of current systems, as long as their performance and flexibility are perceived as adequate and users are willing to tolerate them. However, the upgrade process for on-premises systems is so costly and complex that organizations may also be slow to adopt newer versions.

This factor makes the cloud attractive because of system maintenance and updates are performed by the vendor.
Typically, IT waits until an application reaches the end of vendor support or when its limitations are no longer
acceptable.

At that point, IT begins the process of looking for a new solution that will completely replace the old and may consider either a replacement on-premises system or a cloud solution.

For this decision, it is important to determine what the replacement solution must encompass. Because of core enterprise systems (e.g., finance and HR) include multiple applications, a gradual migration of individual applications may seem to be an easier and less costly path.

However, running multiple, disparate applications from different solutions in parallel can create confusion for users and management headaches for IT. Management control. It’s an understandable reaction: If an application isn’t running on internal servers, that must mean you have a reduced ability to manage it.

However, it has traditionally been difficult for IT to manage system availability, scalability, and performance with the level of resource and infrastructure investment necessary to accomplish business goals. By using a software as a  solution (SaaS) offering, this balance is managed by the vendor and delivered through contractual service level agreements (SLAs).

In turn, IT can focus resources on delivering the services required by the business. Security. Another unsubstantiated fear about replacing applications is that they will be less secure when running in the cloud than on in-house servers. In fact, the security capabilities of a cloud provider can be stronger than what is feasible or affordable for an IT  organization to maintain itself.

But it is important to understand a provider’s security capabilities, especially the model used by the application
for data storage and access. Customization. Any application will need to be customized to fit the specific needs of the business.

But there are important differences in how vendors support those customizations, and for maintaining that support in new versions of the cloud application. Look for a vendor that sustains customizations in new software releases.

The Importance of Cloud Architecture – Core Enterprise Applications

When implementing core enterprise systems, the architecture makes a difference. Today IT has a choice of three application architectures: legacy infrastructure, hybrid cloud, and native cloud.

Legacy Infrastructure Architecture – Core Enterprise Applications

A legacy architecture typically describes a traditional, on-premises application deployment. This architecture offers
the benefits of established investment in IT systems, training, and support resources, as well as extensive application
customization for business needs.

Yet today many IT organizations feel increasingly constrained by the costs and complexity of legacy architectures, especially when trying to meet business requirements for fast, flexible, and scalable change.

Some organizations may try to replicate the on-premises architecture in the cloud. However, this approach is simply a hosted model and doesn’t provide the benefits of a true cloud architecture.

Improvements in application availability, scalability, and performance are often difficult to achieve in this architecture because all updates are specific to individual customers.

Hybrid Legacy and Cloud Architecture – Core Enterprise Applications

Some enterprise system vendors have adapted their applications for the cloud, maintaining many aspects of the legacy architecture in an attempt to retain the comfort and investments of current systems.

This type of hybrid architecture can be an easy way to begin exploring cloud options. But it also has two significant
drawbacks. First, it keeps the limitations of the legacy architecture and cannot fully leverage the advantages of
cloud, especially for quickly accommodating business and technology change.

Second, a hybrid approach actually increases the management complexity of the IT environment. Functions split between on-premises and on-demand in the cloud also increase the need for additional integrations among systems.

Both a legacy and hybrid architecture can continue to be valid choices for maintaining the enterprise status quo.
But given the increasing digitalization of all business activity, that status quo will become increasingly unacceptable. For this case, the cloud-native architecture offers advantages in several critical areas for application deployment.

Cloud-Native Architecture – Core Enterprise Applications

A cloud-native architecture provides for full implementation of the application and data storage in the cloud. In
this architecture, the application is designed from the start to take advantage of cloud infrastructure and services,
with a single version of the software for all users and integrated applications.

The Advantages of a Cloud-Native Application Architecture

A cloud-native approach offers several significant benefits over legacy and hybrid architectures. Application deployment. In a legacy or hybrid cloud architecture, users around the world may be working with different software versions because of differences in the local application infrastructure.

This deployment also creates differences in capabilities and user experience, which in turn creates confusion for the users’ work and increased demands on IT for training and support.

With a cloud-native architecture, all users access a single and current software version. Users are able to work together easily and productively, managers and executives can have greater confidence in application data and functionality, and IT resources can be redirected to more strategic projects.

Additionally, all customers benefit from improvements to the cloud system at the same time. For example, a performance improvement provided by the vendor to meet the needs of one customer is available to all customers.

Application and data security. A legacy architecture simply hasn’t been designed to be compatible with security in the cloud. This design impedes security protections in a hybrid approach as well.
In contrast, a cloud-native architecture is better able to mitigate security risks because it uses a single, central security model. This model simplifies:
• Managing security consistently across geographies
• Maintaining compliance with regulatory requirements for data confidentiality, privacy controls, and application security
• Enforcing policy controls on user access to data and application features Application scalability and management.

The complexity of a legacy architecture complicates the management of a core enterprise system. Even in a hybrid cloud solution, the customer may still be responsible for maintaining some of the server, data storage, and network infrastructure for running the application.

This design typically means significant costs and complexity, although these levels may be lower than in a fully legacy architecture. In a cloud-native architecture, all application infrastructure is owned and managed by the cloud service or application vendor.

The cloud architecture makes it easy for the application vendor to scale computing and storage resources up or down as needed in order to meet customer SLAs and extend application access to new users and locations.

Application flexibility and integration. Implementing new capabilities in a core system has traditionally involved
lengthy software release cycles and upgrades that disrupt system availability and user experience.

This complexity becomes even more challenging for integrating that the system with other applications such as business intelligence, business process management, and collaboration for business activity, or recruiting and payroll applications for human capital management.

These applications often must be “bolted on” for basic connectivity. Cloud-native applications, such as those from Workday, were built from the ground up utilizing a standard application program interfaces (APIs) and web services, which in turn are exposed to customers to leverage for customizations and integrations with other systems.

This approach is in contrast to legacy systems where APIs and web services were added after development, which limits what can be done with applications. The ability to integrate more applications also allow IT to deliver more value such as better information, higher operational efficiency, and process automation.

Another consideration: What to do with customizations and configurations that tailor the application to specific
business operations. “It’s important to ask whether your customizations and configurations for the cloud application
will be sustained in the vendor’s ongoing software updates,” says Stan Swete, chief technology officer for Workday.

“You don’t want to lose the advantage of continuous improvements in a cloud application just because of the vendor’s current software release is no longer compatible with your customizations.”

Contact Musato Technologies to learn more about our cloud computing services that empower businesses and organizations.

Content provided by Workday.