How To Reduce The Risks Of Cloud Supplier Lock-In

13th January, 2017 by
We’ve looked at why cloud supplier lock-in happens even to the best teams, and how it can impact your entire business. Now, let’s talk about how you can reduce the risks of cloud supplier lock-in to stop worrying and take full advantage of the cloud.

But those companies that aren’t embracing all the cloud has to offer are missing growth opportunities. A 2016 report, by consulting firm, Vanson Bourne, found that companies using cloud services move faster are able to reduce IT spending and see a 20% increase in company growth.

  • 20.66% average improvement in time to market,
  • 18.80% average increase in process efficiency
  • 15.07% reduction in IT spending
  • 19.63% increase in company growth.

Have you been holding back from committing to the cloud? It’s time to stop worrying. Be smart about adoption and embrace the benefits of the cloud – while minimizing the risks of cloud supplier lock-in.

Reducing The Dangers Of Cloud Lock-In

Cloud lock-in can happen to anyone, but everyone can avoid the major risks by thinking ahead and knowing what to look for. Think of it as the need to measure twice, and cut once. Anytime you’re building something new, both carpenters and developers need to be proactive to avoid future troubles.

Ask The Right Questions During Procurement:

When you’re examining suppliers for cloud services, don’t be afraid to ask questions. Sales teams are well armed with marketing prepared answers, so ask for references and proof of answers. Otherwise, you might find that the “Yes” you got while shopping turns into a “Yes, but” later down the line. When assessing lock-in, there are three things to examine in particular: data, APIs and services.

#1. How easy is it to migrate your data from your supplier’s platform?

  1. Interoperability: Can you use open source database standards? Or do you have to conform to their proprietary data format? Unusual data formatting can cause issues when migrating in the future.
  2. Portability: Is there a standardized way to export your data so it can be smoothly moved to another cloud supplier? What tools do they offer and what are the costs or limitations of them? Test, test and test some more, even if you’re not currently looking to migrate.  

#2. Does the supplier have an open API that fits with your workflow and technology stack?

When you’re committed to a cloud supplier, you still need to be building supplier agnostic tools. This means taking full advantages of their API to create integrations to internal tools – rather than relying exclusively on their own native tools.  A thorough and API first environment will make this process a pleasure instead of a painful necessity.

#3. Will you become reliant on services specific to your supplier?

In order to make the most of their solution, do you have to become reliant on their own services? Are there open source alternatives available? Are there comparable services at other providers? Think about what your development roadmap and operational needs will look like a year down the road before you commit.

Anticipate Future Costs

What got you here, won’t get you there. If you’re not trying to grow your business, stop reading now. If you’re like most of us, you’re hoping to continue growing. This growth brings additional costs and scale requirements that your supplier might be hoping to exploit.

Many suppliers will have an attractive entry-level offer to entice customers while they are small. But as you add more customers, more requirements and services, you might find that you aren’t getting as good a deal.  If you’ve jumped in with one supplier for a quick win, you need to go back and reevaluate your contract. An attractive entry-level offer can quickly transform into an unwieldy beast that chips away at your credit card. Bring in your procurement team or a second set of eyes to help ask the financial questions you might not have considered at the beginning of a project.

To Anticipate Future Costs:

  • Project your business at five times its current size. Where will your limitations be with your existing suppliers?
  • Now consider your business needs at 50x your current size. Where does the cost structure break?

To add insult to injury, in the event you do need to leave your supplier, there may be financial costs that hit you on the way out. Many suppliers will charge you to export your data or early termination fees on contracts. Get a firm grip on any associated costs with migrating the data and plan them into any budgets early.

Create a risk management plan now

Most risks can be managed simply by thinking ahead. Costs spiral because they are not scoped correctly or not correctly controlled over time, and then grow out of control.  No matter which supplier you choose, performing cost reviews at regular intervals will ensure that your costs stay manageable.

Having a supplier exit strategy is a core part of a robust Disaster Recovery plan. Planning early where the issues will arise can help you navigate around them. Are you finding yourself too reliant on a supplier’s monitoring tools? See if you can start building a platform agnostic tool in house to prevent lock-in.

Don’t start thinking about data migration when you decide to move. It’s already too late! Having a migration strategy and risk reduction plan early will ease any migration plans you decide to undertake – or perhaps prevent the need entirely!

Next Steps

Did this post get your brain turning about your current risk levels? Great – we want to get you thinking! We’re here to help get you sorted with reducing your risk with cloud supplier lock-in. Here’s what you’ll need to do next:

#1. Download our whitepaper on Cloud Supplier Lock-In.

#2. Book your complimentary 30-minute consultation with our highly skilled cloud experts.

#3. Evaluate your own cloud supplier lock-in risk.

Commitment can be scary, but it’s possible to have the best of both worlds – full cloud benefits with minimal supplier lock-in risk. You can do this!