Spiralling costs associated with cloud migration projects have become an increasingly common challenge for modern technology leaders. Recent news that the Bank of England’s Oracle Cloud migration costs increased significantly during delivery is the latest in a series of projects delivered over budget and later than expected.
When budgeting, organisations tend to underestimate the complexity of migration projects, accounting only for the upfront costs of moving content to cloud systems. What they quickly discover is the real cost-sink is in permissions, identity, governance, and adoption. This phenomenon is a “complexity tax” that is only truly discovered once projects are underway. As of 2024, 75% of cloud migration projects are delivered over budget, and 38% are behind schedule, highlighting the business impact of unaccounted-for costs and creating significant monetary and productivity waste.
Tackling overspend usually requires earlier visibility, tighter scope control, and more automation for discovery and remediation.
The Fallacy of the Simple Move
Many leaders fall into the mentality that migrations will be a ‘lift and shift’ job. Budgets are often planned on the assumption that workloads can be moved quickly from one environment to another with minimal friction. The complexity and cost, however, are in the remediation. The complexity of migrations arises when you need to untangle permissions, restore fragmented identity structures, and align legacy governance with cloud-native security. These hidden complexities often surface after migrations are underway, increasing scope and risk.
Legacy environments and human error compound complexity. Environments with hard-coded dependencies and undocumented integrations were often created without the intention of being portable. Equally, legacy system knowledge can be tied with specific senior employees and may be undocumented or partially forgotten if this expertise
leaves the business. When these issues emerge mid-migration, engineering teams are forced into reactive troubleshooting, halting progress while costly workarounds or redesigns are implemented.
When these realities aren’t factored into migration planning, the associated costs and timelines can balloon rapidly. Surveys of technology leaders indicate that migration delays and unexpected issues can cost businesses up to $315,000 per migration project. Teams that land migrations successfully pull risk forward. They do identity and access audits, dependency mapping, and documentation reviews early, not halfway through delivery.
The Coordination Cost of Phased Rollouts
In theory, a phased rollout can reduce risk. In practice, it can increase coordination costs unless there are clear delivery gates and decision rights. Phasing is often the right call in regulated or high-availability environments, but it only reduces risk if readiness criteria have been met and enforced.
Large public-sector migrations, such as those undertaken by the Bank of England, do a lot to illustrate this challenge. As delivery progressed, additional requirements and dependencies surfaced that were not fully accounted for during procurement. That kind of scope expansion also reduces flexibility. It is much harder to change partners mid-stream once critical dependencies, security controls, and integration choices are locked in. As a result, delivery often shifts from a simple two-phase plan to a multi-phase approach. It is a common response when operational realities and readiness constraints slow the cutover.
While reducing risk, the shift highlighted how insufficient coordination can extend timelines and inflate costs. When hybrid environments persist too long, organisations pay twice: for cloud spend that is not fully realised, for ongoing migration effort, and for the connectivity and controls needed to keep cloud and on-premises systems operating together.
Without robust timelines and delivery checkpoints, transition costs can erode projected ROI before the migration is complete.
The Misconception Between Migration and Modernisation
Cloud migration and modernisation are often treated as the same thing, even when the goals and funding assumptions are very different. For organisations looking to move critical business functions to the cloud, what might begin as a planned infrastructure migration can quickly evolve into a broader digital transformation initiative.
When migration budgets are used to address long-standing technical debt, funding can be absorbed by redesigning architecture and refactoring applications, rather than simply relocating existing workloads. Leaders find themselves burdened by the costs of rebuilding systems for long-term scalability, security, and resilience.
As a result, the expected return on investment from migration alone can diminish or disappear entirely, as the scope shifts from system relocation to full re-engineering. Without clear separation between migration and modernisation objectives, organisations again risk misaligned expectations, extended timelines, and budget overruns.
Containing Migration Costs Through Automation and Intelligence
Rising migration costs are easier to control when discovery and assessment are automated and grounded in data. Automation can give teams clear visibility into legacy environments, enabling them to understand complexity, dependencies, and risk before delivery begins. This reduces the overall risk of scope creep mid-project.
Automating discovery and analysis helps organisations identify key structural issues, like permission sprawl and hidden dependencies, early in the process. It also removes much of the high-volume, low-value work typically associated with traditional migration efforts. Teams can make informed decisions about what should be migrated or remediated, rather than reacting to issues as they occur. The result is greater cost predictability, reduced operational risk, and a clearer path to delivering migration objectives within budget and scope.
Most overruns occur in three areas: what you are moving, what you must fix to make it safe, and what you must operate once it is live. Migration plans often price the first and discover the other two too late.
Cloud migrations rarely fail because moving data is hard. They stumble when unaddressed complexity only becomes visible once delivery is underway. This complexity ‘tax’ erodes budgets, extends project timelines, and undermines the business ROI involved in migration.
Organisations that ensure migrations succeed take a different approach. Instead, they invest early in visibility and automation. This enables them to use data-driven insight to understand risk before execution begins. Enforcing clear delivery gates and reducing reliance on manual processes help leaders gain predictability and protect the budget.
Effective cloud transformation is less about speed and more about control and consideration. The ability to anticipate complexity early and act on it decisively separates migration projects from those that stall from those that deliver lasting operational value.
