How to move from on-premise servers to the cloud for small business

Summary

This guide helps you troubleshoot and resolve: How to move from on-premise servers to the cloud for small business. Follow the steps below to fix the issue.

Common Causes

Many small businesses across Brisbane and Australia still rely on physical servers tucked away in office cupboards or corner racks. While these machines may have served your organisation well for years, they come with ongoing costs and risks that cloud services eliminate. Moving your files, identity, and applications to Microsoft 365 and Azure removes the need for on-site hardware, reduces electricity and cooling expenses, and removes the burden of UPS battery replacement and hardware warranty renewals. This guide explains how to retire your physical server and move to the cloud with minimal disruption.

Why retire your on-premise server

Running a physical server in your office means paying for more than just the initial hardware purchase. You are also responsible for ongoing electricity consumption, air conditioning to keep the room cool, uninterruptible power supply (UPS) maintenance, battery replacements, and warranty renewals. If the server fails outside business hours, your staff cannot access files or applications until it is repaired or replaced.

Cloud platforms such as Microsoft 365 and Azure shift these responsibilities to the service provider. Your data is stored in secure Australian data centres, identities are managed through Microsoft Entra ID (formerly Azure Active Directory), and applications run in the cloud rather than on a local machine. This reduces your total cost of ownership and gives your team the ability to work from anywhere.

Planning your migration

Assess your current environment

Before moving anything, take stock of what your physical server currently handles. Common workloads include:

• File shares and department folders
• On-premise Active Directory for user logins
• Line-of-business applications hosted locally
• Print server queues
• Local backup targets

Identify which users access which resources, and note any applications that may not have a direct cloud equivalent. This inventory will help you decide what to migrate, what to retire, and what to replace.

Choose your cloud targets

For most small businesses, the migration path follows this pattern:

• File shares move to OneDrive for personal files and SharePoint team sites for shared department folders.
• User identity moves from on-premise Active Directory to Microsoft Entra ID, synchronised or replaced by cloud-only accounts.
• Email and collaboration moves to Microsoft 365, including Exchange Online, Teams, and Outlook.
• Applications are either replaced with SaaS equivalents or hosted on Azure Virtual Machines or Azure App Service.

Migration steps

1. Prepare your Microsoft 365 tenant. Sign in to the Microsoft 365 admin center and verify your domain. Add user licences for Exchange Online, OneDrive, and SharePoint.
2. Create cloud identity accounts. In the Microsoft 365 admin center, create user accounts that match your existing on-premise usernames where possible. Assign appropriate licences to each user.
3. Set up SharePoint team sites. Create SharePoint sites that mirror your current file share structure. Use clear naming conventions so staff can find folders easily.
4. Migrate file data. Use the SharePoint Migration Tool or a third-party migration utility to copy data from your on-premise file server to SharePoint and OneDrive. Perform an initial bulk copy, then run delta passes to capture changes made during the migration window.
5. Configure user devices. Install the OneDrive sync client on Windows and macOS devices. Map SharePoint libraries to File Explorer so users can access cloud files as if they were local network drives.
6. Migrate email. Use cutover, staged, or hybrid migration methods in the Exchange admin center to move mailboxes from on-premise Exchange or IMAP servers to Exchange Online.
7. Test application access. Verify that line-of-business applications work from cloud-joined devices. If an application must remain on a server, consider hosting it on an Azure Virtual Machine rather than keeping hardware on site.
8. Cut over users. Schedule the final switch during a quiet period, such as a weekend. Point DNS records to Microsoft 365 services and decommission on-premise authentication for migrated users.
9. Decommission the physical server. Once you have verified that all users can access files, email, and applications from the cloud, power down the physical server. Keep it offline for a period before disposing of the hardware, ensuring all data has been successfully migrated and backed up.

Cost comparison: on-premise vs cloud

How 220 Internet Services can help

220 Internet Services is based in Brisbane and supports small businesses and home offices across Australia. Our team can assess your current server environment, plan your migration to Microsoft 365 and Azure, and manage the cutover to minimise downtime. We handle data migration, identity setup, device configuration, and post-migration support so your team can stay focused on running your business.

If you would like assistance planning or executing your server retirement, Open a Ticket.

If you host with us, you don't need to do this yourself — just Open a Ticket and our Brisbane team will get it sorted.

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