Typically, when buying a car, there’s a sticker price that you agree to pay over time to drive it off the lot. Then there are a list of expenses required to keep the car on the road—monthly payments, licensing, maintenance, insurance, etc.
Just about any big purchase includes a lot more than just the sticker price. Smart buyers consider the price of the car along with available interest rates and terms. In some cases, a car might be priced higher but at a lower interest rate so that you could end up paying less in the long run. Insurance rates also vary depending on the type of car as well as the cost for routine maintenance that can be significantly higher for some vehicles.
All of these factors play a role in the Total Cost of Ownership (TCO) for a vehicle. Considering the price and interest rate as well as expenses can influence your decision. The TCO for any item you use regularly can have a huge impact on your life. If you buy a bigger house with more land and swimming pool, your TCO will obviously be much higher than for a more modest home. As the benefits are what you’re likely after, you might want to pay more for something realizing that the TCO is higher than another option.
Hybrid Cloud TCO
Similarly, for enterprise hybrid cloud initiatives, there’s going to be an initial cost for cloud resources and accompanying IT tools and processes based on a combination of one or more of the following: licensing fees, subscription rates, consumption rates, and metered usage.
Each cloud provider will have competitive rates to offer for various IT resources on a subscription basis, and then they’ll have costs for various enterprise IT tools associated with delivering and maintaining the consumption of these resources by end users.
For example, you might have a ticketing system like ServiceNow or Cherwell and enterprise monitoring from AppDynamics or Datadog. For backup and disaster recovery, you could be using Commvault or Veeam. There will be no shortage of complexity.
Some IT tools and Infrastructure or Software-as-a-Service (IaaS or SaaS) offerings will require customizations, training, and various levels of ongoing support. Cloud delivery and management software will be complementary and considered as part of the TCO for most enterprises. As you consider the complexity and the choices you have, consider these top-5 critical factors for TCO.
Top-5 Critical Factors for TCO
When considering any solution that becomes part of your IT resource investment in the cloud or on-premises, make sure you evaluate your choices based on a set of factors similar to the following:
- Implementation—This includes where and how the software solution is installed and maintained. In some cases, the architecture of the solution might require agents and services running from multiple nodes that require extra support. Take into account this more complex type of architecture compared to a lighter weight solution that might be implemented as SaaS or as an all-in-one virtual appliance.
- Training—The cost of training can include purchasing the training units themselves and the seat time to learn the material. Find out how the vendor suggests learning how to be proficient in using the software. Some solutions are more intuitive than others and might have enough online community support or very responsive technical support so that more formal training might be less of a need.
- Time to Value—This is an overlapping consideration based on the training, implementation and other factors related to the usability of the software. How long does it take to get the solution up and running? It might just be a matter of integrating secure, role-based access and the connection settings to various cloud providers and other complementary IT tools. In other cases, it could require a six-month engagement of professional services to get started. Both are equally valid depending on what you’re after for your hybrid cloud initiative.
- Extensibility—This includes the ability of the software to interoperate with other solutions with programmable access to other REST APIs along with any built-in support for the most common best-practice connections to cloud service providers and other IT tools. The idea is that if the solution does not automatically connect to another system, can it be easily programmed to do so? Likewise, does the solution itself have an API to be called by other systems?
- Upgrading—Because of the fast pace of digital innovation and new business requirements, technologies are being added and enhanced while new features are implemented everywhere in the digital ecosystem. A solution participating in this digital ecosystem must be able to keep up with changes and support any new and enhanced technologies as they emerge. Therefore, an upgrade process that occurs more frequently and is easy to achieve will contribute to a lower TCO.
Other factors to consider for TCO include the cost for Professional Services when necessary, as well as the efficiency and effectiveness of Technical Support. CloudBolt as an enterprise hybrid cloud delivery and management solution has been purpose-built to make sure that all five of these factors affecting TCO are continually being addressed and prioritized for customers without compromise.