On a webinar, David Berliner, Senior Director of Product Management at Silk, sat down with Mike Fay, an IT and data management expert with experience from Wayfair, CGI and Verizon, to discuss how companies are navigating the value of cloud adoption in uncertain economic times. 

You can watch the discussion here or continue reading for a recap. 


Six Economic Challenges Facing Companies Today 

During the pandemic there was a rush to the cloud. And now, the business environment is facing a unique set of market forces globally. There are six economic forces that companies are dealing with that significantly affect how they do business, including changing demand, rising inflation, volatile foreign exchange rates, hiring challenges, supply chain pressure, and global uncertainty. On the webinar, David and Mike discussed how the cloud can help businesses mitigate and overcome these current economic challenges. Here’s an overview of each economic challenge to set the stage. 

1. Changing Demand  

The Gartner 2nd quarter IT spending forecast points out that IT investment will continue to grow at a rate of about 5.8%. The Federal Reserve Board members projected a median of 1.2% change in real GDP, which is down from a historic 2% in the last ten years. This means that some sectors will see continued demand while downstream customers will likely face diminished demand from end customers. 

2. Inflation  

In contrast to the slow demand, inflation is higher than in recent years. There has been an increase in nominal costs even as spending shrinks and puts pressure on profit margins from the rising input costs.   

3. Foreign Exchange Rates 

In the past year, nearly all currencies have decreased in value relative to the dollar. This can have many benefits and challenges depending on the direction of trade for your business. For international companies, the price of US goods is higher and continuing to rise, adding to the margin pressures while potentially further reducing demand. On the other hand, for US companies, the price of foreign goods produces greater returns in local currencies. The foreign exchange rates are most likely complicating forecasting and budgeting for your business regardless of where you are.  

 4. Hiring Challenges  

Two seemingly contradictory trends coexist around the labor market. According to the US Bureau of Labor Statistics, there were only a little more than half as many unemployed people as there were job openings in the past year. On the other hand, companies are laying off workers and slowing down hiring in the face of economic challenges.  

5. Supply Chain Pressure 

The global supply chain is still in turmoil. According to the New York Fed, the global supply chain pressure index has decreased for eight of the last ten months. As of October, the pressure index continued to rise and is still above the pre-pandemic levels. This pressure could return to historical levels; the past few years of supply chain pressure might have changed the risk tolerance for supply chain-dependent operations and data centers. The supply chain risk around power has increased, and contractions in the energy market are raising energy prices significantly. We are still facing all these ongoing and evolving challenges due to the pandemic.   

6. Global Uncertainty  

Companies are still facing ongoing challenges as a result of the pandemic. According to Gartner, one of the most important factors for your business to be successful in times of economic uncertainty is staying relevant. It is also important to remain part of the value chain for customers and enable them to do the same for their consumers. To stay relevant, businesses need agility and the ability to support innovation. This is impactful as companies and consumers continue to seek creative solutions. With the economic factors, cost competitiveness becomes increasingly important, and continues to be a significant need for operational improvements.   

Five Ways the Cloud Creates ROI  

Organizations are moving their applications and data away from on-premises data centers to the cloud. And there are many benefits to transitioning to the cloud. The cloud can help provide flexibility, predictability, outsourcing of supply chain risks, reduced operational burden, and price performance value. David and Mike discussed on the webinar how these benefits can negate the impact of economic forces bearing down on your company’s bottom line. 

1. Flexibility  

Flexibility is one of the main reasons why companies decide to move to the cloud. The cloud gives companies the ability to rapidly and near limitlessly scale. Cloud architectures can allow you to provision for lean times and grow rapidly when there is demand. Transitioning to the cloud gives you access to your data from anywhere, and you can scale up and down as needed. During the webinar, one of Mike Fay’s concerns was his company’s imminent data center closure and having to move infrastructure to the cloud by a hard deadline. His team was able to leverage cloud native services to help move their applications and data over to the cloud. There was a significant lift-and-shift that happened to move all of their data to the cloud.  

2. Predictability  

The cloud provides your company with reliable infrastructure and predictability in many ways. Performance and cost predictability are important aspects of having data stored in the cloud. Performance predictability helps you configure resources that are available when needed. Predicting costs helps you forecast the cost of resources that you are using in the cloud.  

3. Outsourcing Supply Chain Risks  

When working with a cloud vendor like Microsoft, Google, or AWS, you no longer need to procure hardware and other assets for on-prem data centers, which can take months to locate, contract for, and secure. Using the cloud vendor’s infrastructure reduces the risks of dealing with supply chain shortages on your own. It becomes the responsibility of the cloud provider to make the infrastructure available for customers, and they are often at the front of the line with suppliers.  

4. Reduced Operational Burden  

Another benefit that cloud architecture can provide is reduced operational burden. From Mike’s experience using Silk on the public cloud, Silk’s data services were easy to use by his team and helped them seamlessly move to the cloud. He could dedicate more resources to migration so they could beat their data center deadline. Mike had never seen anything move so seamlessly and quickly. They deployed well over 23 Silk data pods in roughly three months. With Silk, they were able to replicate their on-prem experiences in the cloud.  

5. Price Performance  

Transitioning over to the cloud can help your company save money. It is important to maximize your business benefits and optimize cloud spending. Mike said it is easy to oversubscribe SQL databases and as an online company they had difficulty forecasting growth. Using Silk snapshots and views helped them save millions per year. Having Silk in the cloud also helped mitigate operational costs for performance, which took a lot of pressure off of their database team to hit the SLAs they had from on-prem. 

Ways that Silk Guarantees Cloud ROI  

The Silk Cloud DB Virtualization Platform makes it easier to deliver better cloud performance at a much lower cost. Silk is a virtualized data layer that sits between your databases and cloud infrastructure. Its shared architecture keeps cloud resources to a minimum, which translates to a lower cloud bill. Silk offers up to 10x faster performance compared to the native public cloud alone to exceed even the fastest on-prem environments.   

Flexibility and Predictability  

Silk sits between your workloads and the cloud. It makes it easy for your company to be flexible on the cloud because of its ability to lift, shift, and evolve. With Silk, you can move mission-critical workloads to the cloud now, with no refactor. This makes it easier to achieve improvements sooner and more predictably and pursue further optimization. This helps reduce risk in uncertain times and enables organizations to get the benefits of using the cloud sooner and more predictably.  

Outsourcing of Supply Chain Risks 

Silk is available in the public cloud marketplaces and is deployed in your cloud tenant. Silk helps you quickly transition workloads to the cloud. We also help you right size workloads and avoid overprovisioning, which saves money and reduces waste. Customers are up and running in about one-third of the time they expected.  

Reduced Operational Burden  

Silk’s active-active architecture enables high availability while two-tier architecture enables scaling of performance, capacity, or both independently. And it makes it easy to scale on the storage or performance side. Silk’s self-healing abilities help reduce the management burden allowing you to rest and focus on other areas while Silk operates. You can proactively avoid disruptions and increase resiliency and recovery while reducing manual effort with data services and automation.  

Price Performance Value 

Being able to right size workloads and not spend on excess capacity just to hit IOPS and throughput targets, or vice versa, is important. Silk’s shared data architecture enables performance that us 10x faster compared than cloud native alone while reducing costs with flexible scalability. The platform’s enterprise data services and snapshot ability can help increase data efficiency and manageability. With Silk, you can get the performance your business needs without the excess cloud costs. Our data services will shrink your storage footprint and improve performance. 

Watch the full 25-minute interview between David and Mike here.