How the cloud can advance your business strategy depends on your situation. The cloud delivers fundamental technology benefits that can aid in executing multiple business strategies. Using cloud-based approaches can improve business agility, reduce costs, accelerate time to market, and even allow businesses to quickly expand into new markets.

As your organization moves forward in your cloud adoption journey, proper planning is key to your success. Your organization already has technology investments, so you must understand your current state and then develop a prioritization plan for your cloud journey.

In this stage, you focus on two main actions:

  • Rationalize your digital estate: Understand the organization's current digital estate to maximize return and minimize risks by running a workload assessment.
  • Create your cloud adoption plan: Develop a plan where prioritized workloads are defined and aligned with business outcomes.
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Rationalize your digital estate

A digital estate is the collection of IT assets that power business processes and supporting operations. To begin cloud rationalization of the digital estate, inventory all the digital assets the organization owns today. Then, evaluate each asset to determine the best way to migrate or modernize each component to the cloud.

During this process, we recommend that you proceed incrementally, application by application. Don't make decisions too broadly or too early across the entire application portfolio.

There are five options for cloud rationalization, sometimes referred to as the Five Rs:

Rationalization option

Expected business outcome

Share Rehost

Also known as a lift-and-shift migration, a rehost effort moves a current state asset to the chosen cloud provider, with minimal change to overall architecture.

  • Reduce capital expense.
  • Free up datacenter space.
  • Achieve rapid return on investment in the cloud.

Web design Refactor

Refactor also refers to the application development process of refactoring code to allow an application to deliver on new business opportunities.

  • Experience faster and shorter updates.
  • Benefit from code portability.
  • Achieve greater cloud efficiency in the areas of resources, speed, cost.

Playbook Rearchitect

When aging applications aren't compatible with the cloud, they might need to be rearchitected to produce cost and operational efficiencies in the cloud.

  • Gain application scale and agility.
  • Adopt new cloud capabilities more easily.
  • Use a mix of technology stacks.

Power Rebuild/New

Unsupported, misaligned, or out-of-date on-premises applications might be too expensive to carry forward. A new code base with a cloud-native design might be the most appropriate and efficient path.

  • Accelerate innovation.
  • Build applications faster.
  • Reduce operational cost.

Cloud computing Replace

Sometimes the best approach is to replace the current application with a hosted application that meets all functionality required in the cloud.

  • Standardize around industry best practices.
  • Accelerate adoption of business process-driven approaches.
  • Reallocate development investments into applications that create competitive differentiation or advantages.

Create your cloud adoption plan

As you develop a business justification model for your organization's cloud journey, identify business outcomes that can be mapped to specific cloud capabilities and business strategies to reach the desired state of transformation. Documenting all these outcomes and business strategies serves as the foundation for your organization's cloud adoption plan.

Key steps to build this plan are to:

  • Review sample business outcomes.
  • Identify the leading metrics that best represent progress toward the identified business outcomes.
  • Establish a financial model that aligns with the outcomes and learning metrics.


Links to sample business outcomes, the business outcome template, learning metrics, the financial model, and the digital estate document are available in the Summary and resources unit at the end of this module.

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Here are the key points from this unit:

  • In the plan stage, there are two major actions: rationalizing your digital estate and creating your cloud adoption plan.
  • In the Plan phase, there are five options for cloud rationalization: rehost, refactor, rearchitect, rebuild/new, and replace. During this process, we recommend that you proceed incrementally.

Let's talk next about how to prepare your organization, your business processes, and your environment for your cloud adoption journey.