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Why Migrate to the Cloud: 11 Benefits to Your Business

Mike Chen | Content Strategist | March 20, 2023

If you still rely primarily on an on-premises data center, moving to cloud computing delivers many business benefits and a range of technical capabilities, with price tiers designed to fit nearly any use case or budget. Even if your organization faces traditional barriers to cloud migration, such as highly sensitive data or high-performance needs, one of the several cloud computing operating models can deliver capacity, scalability, performance, security, and costs similar to, or likely better than, your on-premises data center, without the up-front cost and employee overhead.

What Is the Cloud?

Cloud computing refers to computing resources, data, and applications that run on servers in a data center maintained by a cloud vendor and are accessed over the internet.

Moving to a cloud computing model can deliver benefits well beyond IT operations and provide a return on investment across an organization. The cloud can lower the up-front capital expenditure and ongoing staffing costs required to equip and run an on-premises data center. It can let IT teams focus more on new projects and development and less on manual, repetitive work. More broadly, using the industry best practices that are built into cloud applications can help improve business processes and increase employee productivity. Cloud apps and infrastructure can be accessed remotely, which can improve efficiency and facilitate remote work, which, in turn, can help boost employee satisfaction and retention. And being able to quickly add (or cut) computing capacity or adopt new capabilities can help an organization better seize opportunities or respond to downturns.

Cloud technology can be delivered via public, private, and hybrid cloud models.

Public Cloud
A public cloud is where the cloud provider offers computing capacity and applications over the internet, the computing infrastructure resides in the vendor’s data center, and cloud customers share the vendor’s IT infrastructure. That means multiple organizations might have workloads running on any given public cloud server. Public cloud providers usually offer a tiered pay-per-use model with standards for availability, performance, and speed (called service level agreements or SLAs). Organizations are relieved from maintenance and upkeep duties, such as security patches and hardware upgrades, as these are the responsibility of the provider. This means organizations and their IT staff can spend their energy on more creative work, such as developing new applications or exploring the capabilities of cloud-enabled features such as artificial intelligence and machine learning.

Private Cloud
With a private cloud, a single organization uses a dedicated portion of the cloud vendor’s computing resources. Those resources might be dedicated hardware in the cloud provider’s data center or they may be hosted in the customer organization’s data center and run by the provider. Organizations often choose a private cloud to handle sensitive data or meet specific performance criteria, data control requirements, or other business needs that justify the cost, which is higher than the cost of sharing resources on a public cloud. Depending on the private cloud vendor, data mobility, feature availability, and scalability may be limited, so these factors should be part of any decision to use a private cloud.

Hybrid Cloud
Hybrid clouds make use of public and private clouds, and in some cases, they also integrate on-premises data centers. Hybrid clouds can be configured in numerous ways to meet an organization’s unique needs, and the final design is often based on what data needs to be tightly controlled and what data can be stored using shared resources. For example, an organization may choose to run predictable internal operations, such as finance and supply chain, on a private cloud while running customer-facing web applications on a public cloud so they can scale up and down as demand changes. Or an organization might use the public cloud to house nonproprietary, less sensitive data and a private cloud for data such as health records or sensitive customer information with higher regulatory obligations. When using a hybrid cloud, it’s most important to have a clear plan for the functionality, security, and performance of each element to help ensure a highly available and smooth operation.

Cloud Service Models

Cloud computing refers to software, hardware, and data that’s accessible over the internet and that an organization rents using a pay-as-you-go or subscription model. There are three main types of cloud services.

  • Infrastructure as a service (IaaS): IaaS includes the fundamental computing, storage, and networking services of a data center, provisioned and delivered via the internet. Moving to IaaS frees IT staff from having to run and maintain data center equipment, and it enables them to easily scale capacity up and down.
  • Platform as a service (PaaS): PaaS takes the IaaS environment and adds cloud-based capabilities, such as databases, operating systems, integration, and the management needed for application development. With PaaS, users have the cloud technology to build applications without having to worry about the underlying infrastructure. IaaS and PaaS are generally sold using a pay-for-use pricing model.
  • Software as a service (SaaS): SaaS involves an application that users access via the internet. SaaS applications are run, patched, and updated by the cloud provider. Users usually engage through a web browser or mobile app, and organizations usually pay by subscription. SaaS application examples include business software such as ERP and CRM systems, social media or streaming services, and videoconferencing.

Cloud Deployment Models

IaaS, PaaS, and SaaS are all services that run on clouds, but what about the bones underneath? To meet the varied requirements of different organizations, cloud technology offers several deployment models, including the following:

  • Public: A shared cloud with multiple customers using the server’s resources. Public clouds are the most common.
  • Private: A cloud in which one customer has dedicated access to all the server’s resources. Private clouds can exist in the provider’s cloud data center or sometimes on the customer’s premises—in either case, they’re maintained by the vendor.
  • Hybrid: A configuration that uses public and private cloud resources. This model also sometimes includes on-premises data centers. Successful hybrid clouds require clear delineations between public, private, and on-premises workloads, and any appropriate integration and networking capabilities must be secured.
  • Multicloud: A configuration that uses multiple cloud vendors, allowing organizations to choose the cloud best suited to run a given workload. For example, an application and the related analytics might run on one cloud, while the supporting database runs on another. The success of a multicloud environment is dependent on strong connectivity and secure data sharing.

Key Takeaways

  • Cloud computing can reduce an IT department’s total cost of ownership while automating repetitive manual tasks so teams can focus on more-valuable work.
  • Cloud technology can help organizations improve data security to mitigate potential risks.
  • A cloud environment can offer more-robust disaster recovery capabilities than an on-premises data center at a lower cost.
  • Cloud computing enables growing organizations to add infrastructure and capabilities to keep pace with their needs—and scale back if growth slows.
  • With cloud resources, staff can access applications, databases, and infrastructure from anywhere in the world, providing more-flexible remote access that can help improve collaboration.
OCI delivers high business value

According to IDC, OCI can provide a 474% five-year ROI and a 53% reduction in TCO.

11 Benefits of Moving to the Cloud

Speed, cost savings, scalability—these are just three of the reasons why businesses are moving to the cloud. The 11 benefits below capture the wide range of possible gains.

1. Cost reduction

For many organizations, the primary reason to use cloud services is simple: It costs less than running an on-premises data center. Instead of heavy up-front costs, cloud customers pay for IT as an operating expense. Cloud vendors benefit from economies of scale—savings they can pass on to customers. And a cloud customer organization needs fewer maintenance-focused IT pros since they don’t have to run the data center, maintain hardware, and patch and upgrade software. Instead, IT staff can spend their time and energy on more-strategic work.

2. Agility

Cloud infrastructure and applications let organizations quickly respond to new opportunities and problems by tapping into technology innovations. IT teams can implement new cloud applications faster because there’s no data center hardware to buy and deploy or software to install. After going live on cloud apps, users regularly gain access to new cloud app capabilities without having to install software upgrades. As teams no longer have to worry about buying and provisioning hardware, databases, and containers, new development projects can be set up in AppDev environments in minutes.

3. Flexibility and scalability

Cloud infrastructure lets organizations increase or decrease their computing power as demands change. For example, the world’s shift to hybrid and remote work during the early days of the COVID-19 pandemic required a sudden reliance on videoconferencing; video providers, such as Zoom, were able to ramp up their capacity to meet that surge in demand by tapping cloud-based infrastructure. More broadly, cloud vendors enable many organizations to successfully ramp up resources to meet surges in online sales and scale back computing resources if sales slump, thus lowering operating costs. It would be impossible to accomplish such an increase or reduction in available resources as quickly using a company-owned data center.

4. Security

No matter how talented or large an on-premises data center’s IT team is, it’s almost impossible to match the resources that a cloud vendor can dedicate to security monitoring, patching, and research and development. A cloud vendor is constantly monitoring for security threats and patching and upgrading systems, often using automation, in ways only feasible in the cloud. In contrast, many IT organizations struggle to keep hardware and software patches up to date, leading to vulnerabilities and breaches. In addition, many cloud environments provide built-in security functions that can make it easier to implement tools such as two-factor authentication and data encryption.

5. Sustainability

Cloud vendors run a given server at a much higher utilization rate—meaning they use more of the capacity of a given machine—than conventional on-premises data centers. Traditional data centers have low utilization rates, which means a lot of energy is wasted running servers with idle capacity, either to meet occasional peaks in demand or because of the complexity of load balancing workloads across servers. Cloud vendors’ high utilization rate leads to a more efficient use of electricity. In addition, many cloud vendors have committed to reducing their carbon emissions substantially within the decade, with many pledging to get to net-zero emissions by using renewable energy sources.

6. Reliability

Sudden spikes in demand can slow IT systems to a crawl, creating a ripple effect that hinders employees’ work and impedes productivity. A complete outage is even worse. A cloud solution offers layers of mitigation, including a combination of failover options and automated resource management to help keep applications running. For example, if a cloud provider gets a spike in demand from one application, it can automatically shift some resources from applications with lower demand. This type of real-time automation maximizes reliability without taxing an organization’s IT staff.

7. Accessibility

Moving an organization’s data center and applications to the cloud helps facilitate remote work, which has become an important consideration for many job seekers. Cloud apps and infrastructure let organizations transition to remote work more easily, since employees can access critical apps, such as accounting, supply chain, and HR apps, via their browsers. Even workers who need access to high performance workloads—such as engineering, machine learning, and digital simulations—can access them via cloud infrastructure.

8. Availability

A data center is only as good as its disaster recovery and business continuity plan. Cloud providers maximize availability with strong redundancy and distribution through separate zones within their data centers and across multiple cloud facilities. Disaster recovery is inherently built into an organization’s cloud computing strategy without requiring a major additional investment.

9. Efficiency

By moving to the cloud, IT departments no longer have to handle time-consuming maintenance or upkeep tasks, since they’re now handled by their cloud vendor. Automation is a key efficiency driver across an organization, and cloud applications can help streamline repetitive and routine tasks in areas such as finance, HR, supply chain, marketing, and sales.

10. Collaboration

Cloud technology has significantly changed the way people collaborate online. Cloud applications enable more-effective remote access, as noted above. But even more importantly, because all employees are accessing the same cloud-based application instance and data via a browser, people from every part of the organization can collaborate knowing they’re all working with the same information, enabling faster, better-informed decision-making.

11. Growth

The speed at which companies can add and adopt cloud infrastructure and applications can help them seize new business opportunities and build the capacity to support rapid growth. As companies outgrow their legacy systems for internal operations (for example, finance, HR, or customer service), they can implement cloud-based applications more quickly than they could implement conventional, on-premises apps. Likewise, by using cloud-based infrastructure and platform services, when a company’s growth plans kick in, cloud providers can scale up to accommodate spikes in demand and keep customer-facing, sales-driving systems running.

Migrate to the Cloud with Oracle

If you’re considering a move to the cloud, start by assessing your data center needs, including capacity growth, upcoming hardware refreshes, disaster recovery capabilities, and business responsiveness. Once you have that information, it’s time to identify the best cloud service models and deployment options for your organization and weigh them against the status quo. Whether you pick a public, private, or hybrid model, moving to the cloud is proven to provide measurable business benefits in areas that include cost savings, time to market, and system performance and reliability.

Oracle Cloud Infrastructure (OCI) is a second-generation cloud that delivers all the services required to migrate, build, and run the applications and infrastructure you need to solve your toughest problems. From running on-premises enterprise software to developing new cloud native applications, OCI allows organizations to move workloads to the cloud without costly rearchitecting. OCI also supports multicloud architectures; for example, Oracle Database Service for Microsoft Azure enables organizations to run mission-critical enterprise workloads across OCI and Azure. OCI offers services from more than 40 cloud regions around the world, helping organizations address data residency requirements. It also offers several Oracle Cloud@Customer options for organizations that need to deploy cloud services in their own data centers, giving customers even greater control over their data. For organizations deploying SaaS applications, Oracle Fusion Cloud Applications offer the industry’s broadest suite of cloud apps, including ERP, HCM, supply chain, marketing, and sales apps, as well as industry-specific apps for life sciences, financial services, telecommunications, and many other sectors.

Moving to the Cloud FAQs

How does a cloud environment help our end users?
Cloud technology is often more responsive than an on-premises data center, and it’s often more secure, with stronger disaster recovery capabilities. For end users, cloud-based apps and infrastructure can create a faster, more stable user experience that also incorporates updates and makes new features available faster.

What will IT staff do when data moves to a cloud vendor?
By migrating from a company-run data center to cloud infrastructure, IT staff no longer have to worry about the physical maintenance involved with servers, routers, and cables. Instead, they can spend their time focusing on developing new applications, exploring opportunities unlocked by emerging technologies, such as machine learning, improving processes, and responding to new business needs.

What happens when disaster strikes a cloud provider’s data center?
Any data center is vulnerable to problems, from hardware failures to natural disasters. Disaster recovery and business continuity are two of the strengths of cloud technology. Because clouds are built with numerous layers of redundancy and failover, with availability zones within cloud regions and options to spread workloads across geographically distant data centers, there is no single point of failure.

Delivering on the Promise of Modern Cloud Economics

Learn more about how OCI's approach creates a differentiated cloud experience and delivers on the promise of modern cloud economics.