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  • When Atlassian launched in 2002, it used a traditional model: It sold products that customers bought and installed on their own computers. But in the mid-2000s, it realized that it needed to take on the massive challenge of transitioning to the cloud. 
  • It was a years-long process for Atlassian to move from on-premise software, to software hosted in its own data centers, to, finally, software hosted on Amazon Web Services servers.
  • This transition required Atlassian to rethink how to build and ship its software, which was a challenge both technically and culturally, Atlassian president Jay Simons told Business Insider. Ultimately, it made the company stronger, he said. 
  • Notably, Atlassian used many of its own tools — including Confluence and Trello — to help make the transition as smooth as possible. 
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Many developers rely on Atlassian for tools that help them build, ship, and fix bugs in their software — tools that were critical for Atlassian during its own massive project: a multi-year effort to completely transform its business to become a cloud-based software provider

When Atlassian launched in 2002, it sold tools that customers would download and install on their own computer systems for a one-time license fee, with some other annual charges tacked on. The software industry as a whole, however, was just starting to shift towards a subscription-based business model, where companies would host software in cloud servers and allow customers to pay for it on a monthly or annual usage or per-user basis. Customers seemed to prefer this system, so Atlassian had to adapt.

In 2007, the company embarked on a years-long process, moving from on-premise software that customers would install, to software hosted in its own data centers, to, finally, software hosted on Amazon Web Services servers. 

“That was a big change for us: Shifting from a company that had begun building and shipping software exclusively for an on-prem delivery model to then reconfiguring ourselves and learning how to build and ship with the velocity and all of the benefits that being a cloud provides us,” Atlassian president Jay Simons told Business Insider. 

The process was a challenge, he said, but one that ultimately made the company stronger.

What it took for Atlassian to move to the cloud

Atlassian’s journey involved two separate transformations and each had its own set of challenges. 

First, Atlassian moved its software into its own data centers and it first released the cloud version of its tools Jira and Confluence in 2007

Moving from on-premise software to its own data centers wasn’t a huge shift technology-wise, Simons said, but the process came with its own set of limitations. For example, because Atlassian was limited by the bandwidth of its own data centers, it couldn’t allow its customers to quickly increase the number of employees using the software within their organizations.

Still, the experience wasn’t so different for customers: Even the on-premise versions of Atlassian’s software had a software-as-a-service-esque model, where people could try the software for free before buying it.

While hosting its own software worked well enough, the company realized that offloading the work of building and running data centers to a public cloud vendor would help it move faster and bring on larger customers, while providing a more reliable experience. So, it decided to take on an even bigger, more complicated shift: moving from its own servers to AWS.

To take on the project, Atlassian hired Mike Tria as its head of infrastructure in early 2016. Of Atlassian’s 800 engineers at the time, up to a third were working on the project between 2016 and 2018, Tria said.

“It was the largest single engineering project that Atlassian had done to date,” Tria told Business Insider.

He remembers the summer of 2016 as particularly grueling.

“We would stop all feature work on the products for like a month or two to just have every single developer working on getting this stuff done,” he said.

The transition process took two years: In the first year, Atlassian built the infrastructure and in the second year it actually moved customers over to the cloud-based versions of the software. This process was tricky, Tria said, because his team wanted the transition to be seamless for customers. The goal was that they would have no idea that their software was moving to AWS cloud servers.

For Atlassian’s largest customers, Tria’s team had to work even more carefully and deliberately. 

“We did them one at a time,” Tria said. “We even had a Trello board where we tracked every single customer — we had an engineer assigned to [each] to figure out their specific use case.”

The team moved the last customer from its own data centers to AWS servers on December 16, 2017. To celebrate, Tria said his team pulled out all the stops: t-shirts, parties, town halls, blogs, and “a little video showing us moving our Jira ticket from ‘in-progress’ to ‘done.'”

While Atlassian hopes all of its customers will eventually move to the cloud, it notably still offers on-premise versions of its software for some of its oldest customers, which may still want to run the software on individual machines or in their own data centers.

For very large customers, hosting the software in their own data centers or seeking out their own contracts with cloud vendors is preferable because Atlassian’s AWS offering still has some limitations on how many users each customer can have. Customers with stringent regulations — like in healthcare or government — also sometimes prefer to run the software on their own data centers.

Atlassian is continuing to improve its AWS infrastructure so it can eventually meet the needs of all its customers, Tria said, since running in the cloud ultimately ensures that customers have a more reliable and predictable experience.

Atlassian needed a cultural change along with its technological change

In order to succeed with its technology changes, Atlassian needed to go through a cultural shift as well, Simons said. 

The company started looking for new qualifications in its engineers: It now needed people who had experience building and managing cloud software. In addition to Tria, one of those key hires was Atlassian’s current CTO, Sri Viswanath, in 2016. Viswanath came to Atlassian from Groupon, where he held the same role, and brought his experience with building “high-scale” cloud platforms with him.

“Many of the people that [Viswanath] brought in had an experience set that we didn’t have in the company at the time,” Simons said. “That’s part of understanding ‘What are the experiences, the talent, and the skills that you need in order to service and deliver the thing that you’re trying to do and the customers that you’re going after?'”

Another cultural challenge was learning how to take advantage of the new data and metrics available once it moved to the cloud. Atlassian now had more insight into how customers were using its tools. While that’s something cloud native companies have access to from the beginning, Atlassian had to learn how to take advantage of it, Simons said.

“It allows you to do different things in different ways and improve the product faster,” Simons said. “But you have to learn how to do that. You have to learn what those metrics are. You have to instrument the software.”

Simons said the company used Confluence, its tool for collaboration and document preservation, for this purpose. That helped it understand how customers might be using the products and seeing what could be improved firsthand.

“That helps us maintain this open culture of data practice and ritual sharing,” he said, “That’s a core part of how we’ve grown.”

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