It’s no secret that cloud solutions have been gaining in popularity. By last year, enterprise cloud adoption had risen to 84 percent and was projected to continue its meteoric trajectory. Then COVID-19 hit, and all technology bets were off—except that one.
If anything, the pandemic accelerated cloud migration. Three in four C-suite, IoT, and DevOps leaders are currently modifying corporate strategies due to COVID-19, including increasing spend on cloud-based applications by 35 percent in the U.S. In another survey of tech buyers released in June, 59 percent of respondents now expect to move mostly or entirely to the cloud within 18 months, up from 38 percent who are so cloud-centric today.
Propelled by emerging resilience considerations and the needs of a suddenly remote workforce, many companies are shifting from a "cloud-first" mindset focused primarily on putting any new applications in the cloud to a “cloud now” approach intent on migrating as much of the ecosystem as possible STAT.
Often lost in the cloud migration discussions, however, are data center exit requirements. If overlooked or managed poorly, many facility wind-down tasks can result in harmful financial ramifications, which most businesses can hardly afford at present.
The good news, executing a successful, cost-efficient data center shutdown or downsizing is possible with the right planning.
The Financial Stakes are High
Cloud migrations are being pushed by countless finance leaders in their quest to shift from CapEx to OpEx spending while often increasing agility through the pay-as-you-scale models offered by many providers. This makes cloud budgets the beneficiary of otherwise rampant belt-tightening, but cost remains a significant concern.
A poor migration will undermine cloud advantages in the early days of implementation, at precisely the moment when organizations need the greatest financial benefit to help navigate through COVID-19. Already, a recent survey by Flexera found that most enterprises expect cloud usage to be higher than originally planned, and 79 percent of IT leaders are deeply concerned about managing that spend.
A Complex Task List
One way to lower costs is to attend to all the moving pieces, so to speak, of the move to the cloud. Service migration tends to receive the greatest focus, as IT teams are accustomed to managing application deployments and upgrades with an eye toward minimizing downtime and risk, and they readily apply those skills to the cloud transition. Similarly, lease end dates tend to put the heat on facility turnover necessities, although inadequate attention to site restoration obligations can lead to unexpected charges.
More likely to be put on the back burner are the IT assets themselves. Whether an entire data center is shuttering or only certain applications are being transferred to the cloud, it’s essential to compile a full accounting of the affected servers, storage systems, and networking hardware—and then to act appropriately on that information.
The “to do” list will include tasks like contacting support providers to discontinue any maintenance contracts, along with complex decisions, like determining the proper disposition for each piece of hardware. Many organizations punt on the latter and default to reclamation for all assets, merely selecting a vendor to remove the IT equipment and send it out for recycling.
Better than Reclamation
Unfortunately, a reclamation-only strategy represents a missed opportunity from both an environmental and financial standpoint. Ecologically speaking, it’s always best to reuse any item before disposing of it. This will maximally leverage the many hardware manufacturing inputs, which range from energy and freshwater to plastics and rare earth metals. Reuse also delays components’ entry into the already overflowing e-waste stream.
A company decommissioning its data center may not be able to reuse equipment internally, but this is where the Green Market comes into play. In a true win-win, other companies can frequently benefit from purchasing affordable, functional used equipment, while the original customer extracts residual value from these physical assets through resale.
Barriers to Green Market Success
There are two main barriers to leveraging the Green Market to recoup a portion of the IT equipment investment: expertise and time. It is typically challenging for IT organizations to evaluate equipment for potential resale, securely and permanently wipe all data, repair and refurbish systems that have a viable future with another customer, identify potential buyers, and reap the best price at sale. When the IT team lacks the necessary skills, market relationships, or time to complete these tasks, the hardware will often linger in a storage room or warehouse, steadily losing value until the organization gives up on it and sends it for recycling.
Finding a decommissioning partner with Green Market and data security expertise, along with R2 electronic recycling capabilities, can be invaluable in overcoming these hurdles. A full-service provider will relieve a company of the burdens of asset removal, consolidation, valuation, resale, and recycling. This makes a more profitable and sustainable outcome for decommissioned hardware no more complicated than reclamation.
Alternatively, companies can organize these tasks internally or with limited recourse to outsourcing providers. Greatest success can be achieved by applying project management best practices to the entire undertaking, assigning responsibilities, setting milestones, and monitoring progress toward goals—a process best commenced as soon as the cloud decision is made.
Facility wind-downs and on-premises downsizing necessitate a wide range of high-priority tasks. Organizations should be sure to address each of the following in detail:
- Service migration to shift existing services to the cloud, avoiding unnecessary downtime, data loss, and performance impacts
- Physical asset audit to provide an accounting of IT hardware being displaced by the cloud move
- Maintenance audit to ensure that all decommissioned assets are removed from costly technical support contracts
- Asset removal and consolidation to get equipment out of the data center or colocation space as quickly as possible to minimize additional real estate costs
- Facility restoration to meet any lease obligations for move-out or provide a clean slate for repurposing an owned space
- Equipment valuation and resale to profit from the hardware through the Green Market
- Data security to protect the private and confidential information stored on decommissioned hardware and provide the confidence of U.S. Department of Defense standards for data erasure
- Responsible recycling to process any damaged or unmarketable gear using an R2 electronic recycling process
A rapid and efficient data center exit will return substantial ROI from lease and maintenance contract savings, security risk reduction, resale revenues, and sustainability impacts. This makes the investment in planning and execution of all of these steps well worth the time and resources.