Build an operating model
An operating model defines how your organization structures cloud responsibilities and coordinates teams. Choosing the right model — decentralized, centralized, or Cloud Center of Excellence (CCoE) — directly affects how fast you can deploy, how consistently you enforce governance, and how well your cloud platform scales with the business.
An operating model is shaped by business needs, enterprise architecture, organizational culture, and existing technical capabilities. Every organization's operating model is unique, but most fall into a small set of common patterns.
A well-designed operating model helps you:
Deploy and scale faster: A standardized release pipeline lets teams deploy and scale reliably, improving service responsiveness and flexibility.
Make better decisions: An observable system collects and integrates data from digital operations, feeding a continuous decision loop across the organization.
Optimize resource use: Real-time monitoring of compute, storage, and network resources — combined with targeted optimizations — improves utilization and reduces cloud costs.
Increase stability: Cloud platform monitoring and automation accelerate incident response, shorten fault diagnosis, and raise overall service reliability.
Operating model definitions
The three foundational models — decentralized, centralized, and Cloud Center of Excellence (CCoE) — represent different ways of dividing cloud responsibility across an organization. A CCoE is not a separate operating model: it is a governance function that can sit on top of either a centralized or decentralized structure. Each model can also be extended with Alibaba Cloud's Managed Service or an Independent Software Vendor (ISV) partner.
Decentralized operating model
In a decentralized operating model, each application team owns both development and Operations and Maintenance (O&M) for its own applications and infrastructure. An application is the smallest logical unit for development, deployment, release, and O&M — typically corresponding to one or more code repositories in development and one or more running services in production.
Different roles operate from different priorities:
Development is driven by functional requirements tied directly to business needs.
Testing is driven by the need to find functional defects.
O&M is driven by non-functional requirements — availability, reliability, and performance.
Best for: Organizations with complex, fast-moving applications that have distinct operational needs, where each team manages its own environment.
Advantages
Agility: Teams deploy and scale independently, accelerating innovation.
Domain expertise: Application teams understand their service requirements and tailor cloud configurations accordingly.
Clear accountability: Each team owns its environment, making issues straightforward to identify and resolve.
Disadvantages
Coordination overhead: Cross-team communication and handoffs can slow overall organizational throughput.
Inconsistent governance: Independent teams may apply inconsistent security, compliance, and cost policies.
Siloed knowledge: Physical separation or logical isolation makes it harder to share expertise across teams.
Decentralized + Managed Service operating model
If a decentralized organization needs specialized support for cloud platform operations — or wants to outsource parts of day-to-day infrastructure O&M — consider Alibaba Cloud's Managed Service. This service provides expert support for the cloud environment, helps meet security and compliance requirements, and supports regulatory objectives.
Decentralized + ISV operating model
If a decentralized organization needs software development for a specific domain or industry, consider working with an ISV. ISV partners complement your products with solutions that more precisely meet customer needs. Alibaba Cloud's Ecosystem Partner network offers application development, testing, deployment, and management services to help you build and ship applications faster.
Centralized operating model
In a centralized operating model, a dedicated infrastructure engineering team provides a standardized platform to all application teams — including infrastructure automation, configuration management, and release tooling. Application teams use this platform to develop, test, and run their applications without managing the underlying infrastructure.
Best for: Organizations with a stable, steady-state application portfolio where consistency, compliance, and cost control take priority over per-team autonomy.
Advantages
Standardization: A single platform delivers consistent operational performance across all application teams.
Reduced compliance risk: Centralized management of production access limits privileged users, reducing the attack surface.
Cost efficiency: Shared infrastructure and unified tooling lower operational overhead.
Disadvantages
Innovation bottleneck: Teams outside the infrastructure group have limited direct environment access, which can discourage experimentation.
Cloud-readiness gap: A platform originally built for traditional data centers may require significant re-architecture for cloud-native operations.
Scaling pressure: As adoption grows, the central team can become a bottleneck for teams waiting on environment changes.
Centralized + Managed Service operating model
If a centralized organization lacks the skills or headcount to support cloud platform operations — or wants to build differentiated capabilities while outsourcing routine infrastructure O&M — consider Alibaba Cloud's Managed Service. This service provides expert support for the cloud environment, helps meet security and compliance requirements, and supports regulatory objectives.
Centralized + ISV operating model
If a centralized organization needs software development for a specific domain or industry, you can either build an in-house application engineering team or work with an ISV. ISV partners complement your products with solutions that more precisely meet customer needs. Alibaba Cloud's Ecosystem Partner network offers application development, testing, deployment, and management services to help you build and ship applications faster.
Cloud Center of Excellence (CCoE) operating model
A Cloud Center of Excellence (CCoE) is a cross-organizational governance function that guides cloud adoption strategy, sets guardrails, and enables teams — while the underlying operating model (centralized or decentralized) determines how day-to-day work is organized. An enterprise typically establishes at least one cloud management team or forms a CCoE of key stakeholders to plan the overall cloud adoption strategy, confirm direction at the organizational level, and gather requirements from across the business.
A CCoE organization typically includes:
Executive leadership: The executive team defines the strategic importance of the cloud and sets expectations for how teams use it.
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Cloud Center of Excellence: This team — which may be a virtual organization — designs the cloud service delivery model and management framework, and provides technical enablement. Members include:
Architects and technical professionals responsible for cloud architecture and workload migration.
Experts in security, compliance, and other domains responsible for designing the IT governance plan, assessing risks, and setting governance rules.
Financial experts responsible for establishing financial management processes and cost allocation rules.
Cloud management team: After migration, this team continuously optimizes the cloud architecture and provisions environments for new business initiatives. It establishes the enterprise's cloud O&M system, builds an operations platform, and uses automated O&M to govern the cloud environment on an ongoing basis. The team provisions and configures cloud resources and permissions based on new business needs, so application teams can consume the cloud without managing the underlying infrastructure.
Best for: Organizations planning large-scale cloud migration or using the cloud to drive market-differentiating innovation.
CCoE + Managed Service operating model
While building a CCoE, you can extend your capabilities by outsourcing parts of cloud platform operations to a professional service provider. Alibaba Cloud's Managed Service provides expert support for the cloud environment, helps meet security and compliance requirements, and supports regulatory objectives.
CCoE + ISV operating model
While building a CCoE, if you need software development for a specific domain or industry, consider working with an ISV. ISV partners complement your products with solutions that more precisely meet customer needs. Alibaba Cloud's Ecosystem Partner network offers application development, testing, deployment, and management services to help you build and ship applications faster.
Choose the right operating model
As your organization moves from on-premises to the cloud, the right model depends on your current strategy, culture, and organizational structure:
Decentralized: Best for complex, fast-moving applications with distinct operational requirements, where development teams also manage their own environments.
Centralized: Best for stable, steady-state application portfolios where consistent governance and cost control matter more than team-level autonomy.
CCoE: Best when planning a large-scale cloud migration or using the cloud to drive innovation that creates a market advantage. A CCoE provides guardrails and repeatable controls so workload teams retain agility while operating within a governed framework.
Whichever model your organization uses today, it was adopted to meet current business needs and strategic goals. If your strategy evolves and a new model becomes the target state, expect a transitional period where two models coexist. Plan, experiment, and iterate continuously to close the gap between where you are and where you want to be.