CIO playbook: Rebalancing your portfolio in a multicloud world

Financial investors perform a fascinating, yet delicate dance.

Consider assets such as stocks. To weather volatile stock markets, investors rebalance their portfolios often, dumping some stocks while picking up others based on trends. Professional investors factor in certain financial targets and risk tolerance as they pursue maximum ROI.

IT leaders can relate to this dance.

Just as investors play financial markets, IT leaders navigate technology trends. Like investors, they seek optimal outcomes while minimizing risks. And like their financial counterparts, IT leaders must also regularly rebalance their portfolios. This includes migrating to different tools, based on changing requirements such as performance, latency, resiliency, and security, as well as cost efficiency.

This has never been truer than in the digital era, where IT leaders consume a variety of on-premises and cloud technologies as they continually modernize their businesses.

The rebalancing act

With applications requirements changing as business needs evolve, IT leaders are reassessing the value they are getting from their solutions, including the best locations in which to run their application workloads. And they are rebalancing their workloads.

Fifty-three percent of IT decision makers said they were moving workloads out of public clouds to other locations, compared to 45% of respondents who are moving from datacenters, 40% from colos, and 34% from edge environments, according to an internal Dell survey1.

Their thinking: Distributing workloads across multiple IT estates, such as on-premises systems, public and private clouds, colos and edge networks, affords them the best opportunity to achieve competitive advantages.

Other micro-trends are emerging. Private clouds are enjoying something of a resurgence. Once viewed with skepticism by IT practitioners who have experienced failures due to mismatched or aging infrastructure, poor governance and escalating costs, the private cloud is getting love from the CIO cohort.

While interviewing 22 CIOs, Constellation Research analyst Dion Hinchcliffe learned that CIOs who incorporated private clouds found them 65% more performant, 50% less expensive, and twice as agile for application development and DevOps cycles compared to similar workloads running in public clouds2.

It’s a small sample size, but the results underscore the broader rebalancing act that CIOs are undertaking as they seek the balance between optimal performance, security, and cost efficiency.

“Private cloud today in fact is often as sleek and contemporary as public cloud from a technology and run-time perspective,” Hinchcliffe wrote in a recent blog post calling out his research. “And it turns out that in particular use cases, it can genuinely shine.”

The public cloud as master instructor

No surprise there.

With nearly 20 years of technical groundwork laid by hyperscalers, the public cloud has been an invaluable instructor for IT organizations, which leverage its best practices and blueprints to build world-class modern infrastructure.

Take, for example, application portability. No longer are public cloud purveyors the sole consumers of containerized applications. Most enterprise IT departments are familiar with Kubernetes and other tools that help orchestrate and manage containers.

And they’re deploying these tools in private clouds and other environments to gain portability, performance, security, compliance, and other benefits that are essential for meeting go-to-market goals.

Pretty much any class of functionality created in a public cloud has been or can be replicated on-premises in private clouds through software-defined infrastructure and automation.

Cloud rebalancing or optimization? It’s both.

Note that Hinchcliffe framed the architectural decision between public and private cloud as a “rebalancing.” This is fair and appropriate.

Rebalancing is broader than cloud optimization, which industry experts have been using to describe how they are reallocating workloads to achieve a more optimal IT estate, while helping them spend down.

Regardless of which phrase you prefer—cloud rebalancing or optimization—gauging the proper placement for your workloads remains critical. It can mean the difference between hemorrhaging money for running applications in the wrong location, performance degradation, or even an inadequate security profile that leaves you open to liabilities.

If you do decide to rebalance your IT portfolios, be sure to reinvest in a multicloud architecture designed to run workloads in public and private clouds, on-premises systems, colos and edge networks. In that vein, a multicloud-by-design strategy is the best bet for your technology portfolio.

Our Dell APEX suite of solutions facilitates the multicloud-by-design strategy that can help IT organizations enjoy consistency, agility, and control while achieving desired business outcomes—without the constraints associated with siloed ecosystems and proprietary tools.

Also, Dell APEX provides more deployment flexibility while reducing operational friction through common orchestration, automation, governance, and security for traditional workloads, as well as cloud-native and edge-native workloads that drive new digital business initiatives.

Whether you’re optimizing or rebalancing your portfolio, don your financial investor hat and ask yourself: How and where are you going to invest your dollars?

Learn more about how Dell APEX can help you apply a multicloud-by-design approach to your IT strategy.

1 Multicloud Architecture: Workload Movement Considerations, Dell, April 2023.
2 The New 2023 Cloud Reality: A Rebalancing Between Private and Public Cloud, Constellation Research, June 2023.

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