Scenario:

Background:

E$-$Commerce Company: GearBazaar

GearBazaar is a thriving e$-$commerce company specializing in outdoor adventure and sports gear. Despite its success in the market, the company is facing challenges due to outdated IT infrastructure and intense market pressure.

Annual Revenue: $$920$ million

While the revenue is substantial, the outdated IT infrastructure poses challenges in managing the increasing load on the website and providing a seamless user experience.

Average Order Value $($AOV$)$: $$150$

Customers typically spend $$150$ per transaction, reflecting the premium nature of the outdoor gear.

Number of Customers: $1,800,000$

A dedicated customer base passionate about outdoor activities.

Conversion Rate: $2\mathrm{.}5\%$

The slow and outdated website has affected the conversion rate, leading to potential customers abandoning their carts.

Monthly Website Traffic: $23\mathrm{.}5$ million visitors

Despite the high traffic, the outdated infrastructure results in slower page load times and occasional website crashes during peak hours.

Customer Retention Rate: $20\%$

Retaining customers is challenging due to the competition and the need for a more personalized shopping experience.

Number of Products Sold Monthly: $800,000$

The range includes hiking gear, camping equipment, and adventure electronics.

Return Rate: $8\%$

The return rate is slightly higher due to customer dissatisfaction with the website's performance and occasional fulfillment errors.

Marketing Spend: $$100$ million

Marketing efforts are crucial to maintaining visibility, especially in a competitive market. However, the outdated IT infrastructure limits the effectiveness of certain digital marketing strategies.

Operating Profit Margin: $8\%$

The profit margin is impacted by the need to allocate a significant portion of revenue for IT upgrades and improvements.

Average Shipping Time: $4$ days

The shipping process is hindered by the outdated order fulfillment system.

Customer Satisfaction $($CSAT$)$ Score: $3\mathrm{.}8$ out of $5$

While customers appreciate the quality of the products, dissatisfaction with the online shopping experience has affected the overall satisfaction score.

Employee Count: $600$

The company has a dedicated workforce managing various aspects of the business.

International Market Presence: Ships to $15$ countries

Expanding internationally is challenging due to the limitations of the current IT infrastructure.

The company recognizes the urgent need for a major IT upgrade to stay competitive and address customer concerns. The high market pressure emphasizes the importance of adapting to new technologies and implementing a more efficient and modern e$-$commerce platform to maintain its market position and profitability.

The IT team is responsible for ALL aspects of IT$,$ including application, infrastructure, integration, security maintenance and monitoring. IT team is also responsible for application development and enhancements. Currently, the IT team has six months of work backlog and cannot retain talent due to high workload, mundane tasks, and lack of career growth.

The company uses $35$ different applications hosted in $2$ data centers in Canada. Both data centers are $90\%$ occupied and have no space to add additional infrastructure.

The company's IT Technologies are coming to the end of support, and there is no plan to upgrade or replace. Current technologies are unable to meet business and market needs. As a result, many business units in the organization have started their work around solutions by having many offline Excel spreadsheets. In short, the IT Team and Technologies are becoming the bottleneck for business growth.

Executive management expects Digital Transformation to solve Business and IT issues.

Cloud Migration:

GearBazaar Inc. is evaluating moving its e$-$commerce application to the cloud.

IT team's preferred choice is PaaS. The business team's preferred choice is SaaS. Marketing executives want to outsource the entire e$-$commerce application. IT operations leader would like to keep it on$-$premises but will support PaaS.

IT infrastructure team thinks that this move will cause job loss. Business stakeholders do not fully understand what this move will mean to them. The finance team is only interested in dollar numbers and won't approve the project until they have the total ROI. Cloud vendors have provided three approaches, but it is up to IT and business stakeholders to select one.

Working as a Lead Business Analyst, the Digital Transformation Steering Committee has asked you to perform the following analysis and report back to the steering committee in two weeks.

The Steering Committee consists of senior leadership $($VP and above$)$ from IT and business.

The Steering Committee asks:

Define the problem statement.

Identify stakeholders for the cloud project.

Pros and Cons of SaaS, PaaS, and On$-$premises

List the critical decision points.

Potential IT and Busines