This post is the first part of a series on The Cloud Native Enterprise.

It took some time, but it seems digital disruption has finally broken through the barriers and arrived in the Philippines full force.

Everyone is realizing the need to transform: Last month, Summit Media, the nation’s largest print magazine publisher, rebranded itself as a digital media company and subsequently launched a Content Lab for branded storytelling across physical and digital channels. Last year, PLDT began a massive pivot away from its dwindling long-distance revenue, prompting PhilStar to spell out its (and soon every giant’s) unofficial mantra: “adapt or perish.”

So it’s safe to say that the pressure is on for corporations to innovate and go digital. The question is how — how to transition culture, systems, and processes in institutions that employ tens of thousands and serve tens of millions of people.

The IT Dilemma

The initial barriers to digital transformation are often strategic and cultural: making a commitment to adapt, and then getting the organization to see and buy into that new direction.

But even the most determined and aligned companies are held back by the infrastructure and IT systems that their companies are built upon. 9 out of 10 IT decision-makers report that they are held back by their outdated IT systems, and it was found that 80% of IT workers spend over half of their time troubleshooting and maintaining legacy systems . These old systems keep companies from adopting new technology due to incompatibilities or difficulties in integration.

People have increasingly looked to the cloud for an answer. Cloud computing, in plain terms, is a service that allows you to rent remote server space rather than own it. This allows you to pay for server space as you use it, which in turn enables companies to scale up new services that work and scale down services that don’t with little risk.

Cloud-native apps, which are optimized for the cloud environment, employ elements like microservices, which break down complicated apps into small functions that can be upgraded and deployed independently, and containers, which allows software to work with different forms of hardware. These characteristics allow apps, services, and systems built on the cloud to be modified, adapted, changed, deployed, and scaled rapidly in the spirit of experimentation.

But the cloud comes with its own risks: cloud security has improved significantly, but will never be on par with a well-managed private server. It requires a massive shift in culture: from siloes and long production timelines to maximum collaboration and once-a-week updates. Furthermore, leaving the legacy system altogether isn’t really an option: old IT systems often contain wells of valuable information, are informed by many years of troubleshooting and experience, and are connected to countless business and operational processes that would be thrown into chaos without it.

So what’s the CTO of a large bank to do in the face of this dilemma? Waiting around isn’t an option either: upstarts with little to lose are starting from scratch and harnessing the cloud to grow and carve out market share seemingly in warp speed. Incumbents must figure out a way to keep pace, launch their own breakthroughs, while minimizing their exposure to risk.

Why not have it both ways?

When we first spoke to the team of the largest bank in the Philippines, they were puzzling through this very challenge.

Though they were committed to reinventing themselves for the digital world, they were feeling constrained by their legacy IT systems, which made it difficult to try new technologies without exposing themselves to security risks. On the other hand, they had seen banks diving completely into the cloud — something that, for them, could be a recipe for disaster. This was the banking sector, one of the most high-stakes of them all, and as the bank’s CEO put it: “People don’t like to be told that you’re experimenting with their money.”

When we asked, “Why not do both?” it felt like a dozen lightbulbs going off across the room. What we’ve found with our clients from banking, retail, healthcare, and beyond is that moving to the cloud isn’t a binary decision or an on/off switch. It’s a process. That process hinges on a hybrid cloud which connects public cloud servers, private cloud servers, and privately-owned, often legacy, servers and systems.

More than just a hybrid cloud, we at Amihan believe in a Legacy to Cloud-Native (L2CN) Enterprise Architecture which merges the best of both the cloud ecosystem and your own legacy IT systems.

The idea behind L2CN is to minimize risk and maximize the opportunity for innovation. In an L2CN enterprise, the company invests in extending and strengthening their legacy system — while at the same time building new services and products for the cloud, where they can be deployed, modified, and scaled with ease.

Over time, as breakthrough services scale up and become more central to the whole enterprise, the balance of the company’s operations will naturally shift towards the cloud. But this migration happens gradually, not all at once.

To learn more about how to build a Legacy to Cloud Native (L2CN) Enterprise Architecture, join us at our April 25 event or download our 1-page guide:

DOWNLOAD: Legacy to Cloud Native Enterprise Architecture (PDF)

How do you merge your legacy systems, the private cloud, and the public cloud in order to achieve breakthrough innovation?