Research Report

Cloud Migration Strategies 2026

8-MINUTE READ
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NOVEMBER 27, 2025
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In brief

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Cloud migration refers to the process of transferring data, applications, and workloads from on-premises infrastructures to cloud-based environments, enabling organizations to leverage the benefits of cloud computing, such as scalability, flexibility, and cost-efficiency. This shift is notable as it allows businesses to reduce operational costs and improve their agility in responding to market demands, making cloud migration a pivotal component of digital transformation strategies across various industries.

The migration process typically involves several strategies, often summarized as the "6 R's": rehosting (lift and shift), replatforming, refactoring, repurchasing, retiring, and retaining. Each of these approaches addresses specific organizational needs and technical requirements, allowing for tailored solutions that optimize performance and resource management.

While cloud migration presents significant advantages, it also poses challenges, including data security concerns, potential vendor lock-in, and the need for effective change management strategies to overcome organizational resistance. Prominent case studies, such as Netflix, Capital One, and Unilever, illustrate how successful cloud migration can lead to enhanced operational capabilities, improved customer experiences, and accelerated innovation cycles.

Types of Cloud Migration

Cloud migration encompasses various strategies for transferring IT workloads, applications, and data from on-premises environments to cloud-based solutions. Understanding these different types of migrations is crucial for organizations aiming to leverage the benefits of cloud computing while aligning with their specific operational goals.

Refactoring

Refactoring, or rearchitecting, involves modifying an application's architecture to better utilize cloud-native capabilities. This process may include changing the application's code or structure to incorporate more efficient, scalable features such as microservices or serverless computing. Refactoring aims to enhance the application's performance and flexibility while addressing the evolving needs of the business.

Replacing

Replacing, also known as repurchasing, entails discarding custom-built applications and opting for third-party Software as a Service (SaaS) solutions. This drastic change can streamline operations and reduce maintenance efforts, as the organization relies on the cloud vendor's services and infrastructure.

Rehosting

Rehosting, often referred to as "lift and shift," is a common strategy that involves moving applications to a cloud provider's data center with minimal modifications. This approach allows organizations to quickly transition existing workloads without the need for significant redesign or redevelopment, making it a relatively straightforward option.

Replatforming

Replatforming is a middle-ground strategy that enhances an application without completely redesigning it. This method focuses on optimizing the workload for cloud environments by making necessary adjustments, such as adopting managed services or utilizing Platform-as-a-Service (PaaS) offerings. Replatforming can offer improved performance and resource management, allowing organizations to leverage cloud features while minimizing disruptions during migration.

Retiring

The retiring strategy involves identifying and deprecating on-premises applications that are no longer needed or relevant. This approach allows organizations to streamline their IT portfolios and focus on more efficient, cloud-based solutions. By retiring unnecessary applications, businesses can reduce costs and complexities associated with maintaining outdated systems.

Hybrid Migration

Hybrid migration strategies combine various approaches, allowing organizations to adopt cloud services incrementally while retaining some on-premises infrastructure. This method enables a tailored migration process that aligns with specific business requirements and operational capabilities. Hybrid strategies can help organizations balance cloud benefits with existing resources, providing flexibility during the transition.

Benefits of Cloud Migration

Cloud migration offers a multitude of advantages for businesses looking to enhance their operational efficiency, reduce costs, and innovate at a faster pace. As organizations increasingly transition their IT workloads to cloud environments, the benefits become evident across various dimensions of business performance.

Cost Efficiency and Reduced Operational Expenses

One of the most significant advantages of cloud migration is the potential for substantial cost savings. By shifting from traditional on-premises infrastructure to cloud solutions, businesses can reduce their capital expenditure (CapEx) and instead operate on a more predictable operating expenditure (OpEx) model. This change allows organizations to reallocate budgets towards growth initiatives rather than hardware maintenance, ultimately leading to operational expenses being reduced by 20-40% post-migration.

Enhanced Security and Compliance

Beyond cost savings, cloud migration enhances security measures significantly. Cloud providers offer built-in security features, such as multi-layered protection, encryption, and compliance management, that many organizations cannot implement on their own due to budget constraints. With 24/7 monitoring and automated patching, cloud solutions are designed to keep sensitive data secure, allowing businesses to comply with regulations like GDPR or ISO 27001 more efficiently.

Scalability and Flexibility

The cloud's inherent scalability is another major benefit, enabling organizations to adjust their IT resources in response to fluctuating workloads. This adaptability means businesses can expand their digital capacity seamlessly without the need for costly infrastructure upgrades. During peak periods, applications can maintain optimal performance without wasted resources during off-peak times.

Improved Business Agility and Operational Continuity

Cloud migration fosters operational agility, which is crucial for businesses to thrive in today's competitive environment. By leveraging cloud infrastructure, organizations can restore systems quickly in the event of a failure, minimizing downtime and ensuring that core services remain available. The ability to operate smoothly even under unexpected stress enhances business resilience.

Access to Advanced Technologies

Migrating to the cloud provides organizations access to cutting-edge technologies such as artificial intelligence (AI), machine learning (ML), and big data analytics, which can drive innovation and improve decision-making processes. Cloud platforms typically offer a broader range of services and tools than what an organization might set up independently.

Environmental Sustainability and Energy Efficiency

Cloud migration also contributes to environmental sustainability. Traditional on-premises infrastructure often leads to high energy consumption due to underutilized hardware and inefficient cooling systems. By migrating to the cloud, organizations can consolidate their operations, significantly reduce energy costs, and decrease their carbon footprint.