The public cloud is a different beast than an on-premise environment, and that also reflects itself on how we (should) look at the processes that are actively steering infrastructure designs and architecture. One of these is the business continuity, severe incident handling, and the hopefully-never-to-occur disaster recovery. When building up procedures for handling disasters (DRP = Disaster Recovery Procedure or Disaster Recover Planning), it is important to keep in mind what these are about.
What is a disaster
Disasters are major incidents that have wide-ranging consequences to the regular operations of the business. What entails a disaster can be different between organizations, although they are commonly tied to the size of the infrastructure and the organizational and infrastructural maturity. I'll get back to the size dependency later when covering public cloud.
A small organization that only has a few systems can declare a disaster when all those systems are unreachable because their network provider's line is interrupted. A larger organization probably has redundancy of the network in place to mitigate that threat. And even without the redundancy, organizations might just not depend that much on those services.
The larger the environment becomes though, the more the business depends on the well-being of the services. And while I can only hope that high availability, resiliency and appropriate redundancy are taken into account as well, there are always threats that could jeopardize the availability of services.
When the problem at hand is specific to one or a manageable set of services, then taking appropriate action to remediate that threat is generally not a disaster. It can be a severe incident, but in general it is taken up by the organization as an incident with a sufficiently small yet efficient and well organized coordination: the teams involved are low in numbers, and the coordination can be done accurately.
However, when the problem is significant or has a very wide scope, then depending on the standard incident coordination will be insufficient. You need to coordinate across too many teams, make sure communication is done correctly, business is continuously involved/consulted, and most of all - you want to make sure that the organization doesn't independently try to resolve issues when they don't have a full view on the situation themselves.
The latter is a major reason in my opinion why a DRP is so important to have (the plan/procedure, not an actual disaster). If there is no proper, well-aligned plan of action, teams will try to get in touch with other teams, polluting communication and only getting incomplete information. They might take action that other teams should know about (but won't) or are heavily impacted by (e.g. because they are at that time trying to do activities themselves). It can make the situation much worse.
Because we have to make a distinction between incident management and disaster management, an organization has to formally declare a problem as a disaster, and communicate that singular fact ("we are now in disaster mode") so that all teams know how to respond: according to the Disaster Recovery Plan (DRP).
Disasters are not just 'force majeure'
Disasters aren't extraordinary events or circumstances beyond the control of the organization. Depending on the business needs, you might very well take precautionary actions against situations you've never encountered before and will never encounter. We've recently had a disastrous weather in Belgium (and other countries in Western Europe) with floods happening in large areas. But that doesn't mean that for an organization a flood event will trigger a disaster declaration within a company (the disastrous weather was a disaster from a human side, with several dozen deaths and millions of damage, so it feels somewhat incorrect to consider the threat from a theoretical standpoint here).
If you're located in a flood-sensitive environment, you can still take precautionary actions and assess what to do in case of a flood event. Depending on the actions taken, a flood event (threat) will not manifest into availability concerns, data and infrastructure destruction, people unavailability, etc. It is only when the threat itself turns into an unforeseen (or non-remediated) situation that we speak of a disaster.
This is why disasters depend on organizations, and how risk averse the organization (and business) is. Some businesses might not want to take precautionary actions against situations that in the past only occur once every 100 years, especially if the investment they would have to do is too significant compared to the losses they might have.
Common disaster threats (sometimes also called catastrophic events) that I'm used to evaluate from an infrastructure point of view, with a company that has four strategic data centers, multiple headquarter locations and a high risk averse setting (considering the financial market it plays in) are cyberattacks, local but significant infrastructure disruptions (data center failures or destruction), people-oriented threats (targetting key personnel), critical provider outages, disgruntled employees, and so forth. Searching for risk matrices online can give you some interesting pointers, such as the European Commission's Overview of Natural and Man-made Disaster Risks the European Union may face.
Public cloud related events
In case of public cloud, the catastrophic events that might occur are different, and it would be wrong to just consider the same events and with the same action plan. A prime example, and the one I really want people to focus on, is regional outages.
If your current company considers region-wide failures (for instance because you have two data centers but within the same region) more from a reactive point of view rather than preventive (e.g. the DRP in case of region-wide failures is to approach the reconstruction within the region whenever possible, rather than fail over to a different region), it might feel the same about public cloud region failures.
That would be wrong though. Whereas it is likely that a region-wide failure for a company is not going to happen in its lifetime, a public cloud provider is so much more massive in size, that the likelihood of region-wide failures is higher. If you do a quick search for region-wide failures in AWS or Azure, you'll find plenty of examples. And while the failures themselves might be considered 'incidents' from the public cloud provider point of view, they might be disasters for the companies/customers that rely on them.
For me, tackling disaster recovery when dealing with public cloud strongly focuses on region failures and (coordinated) recovery from region failures. Beyond region failures, I also strongly recommend to look into the dependencies that the public cloud consumption has with services outside of the public cloud. Some of these dependencies might also play a role in certain catastrophic events. Say that you depend on Azure AD for your authentication and authorization, and Microsoft is suddenly facing not just a world-wide Azure AD outage, but also has to explain to you that they cannot restore its data.
Preparing for disasters is about preparing for multiple possible catastrophic events, and in case of public cloud, you're required to think at massive scales. And that includes designing for region-wide failures as well.
Impact of public cloud disasters to the organization
Generally, if your organization has a decent maturity in dealing with disaster recovery planning, they will be using Service Level Agreements with the business to help decide what to do in case of disasters. Important non-functionals that are included here are RTO (Recovery Time Objective), RPO (Recovery Point Objective), and MTD (Maximum Tolerable Downtime). There are others possibly listed in the SLA as well, but let me focus on these three. If you want to learn more about contigency planning in general, I recommend to go through the NIST Special Publication 800-34 Rev.1, "Contingency Planning Guide for Federal Informatino Systems".
With the RTO, we represent the time it is allowed to take to recover a service to the point that it functions again. This might include with reduced capacity or performance degradation. The RTO can be expressed in hours, days, weeks or other arbitrary value. It is a disaster-oriented value, not availability! As long as no disaster is declared, the RTO is not considered.
The RPO identifies how much data loss is acceptable by the business in case of a disaster. Again, this is disaster-oriented: the business can very well take extra-ordinary steps to ensure full transactional consistency outside of disaster situations, yet allow for a "previous day" RPO in case of a disaster.
The MTD is most often declared not on a single service, but at business service level, and explains how long unavailability of that service is tolerated before it seriously impacts the survivability of the business. It is related to the RTO, as most services will have an RTO that is more strict/lower value than the overall MTD, whereas the MTD is near non-negotiable.
Now, what does public cloud disasters have to do with this? Well, in theory nothing, as this model and process of capturing business requirements is quite sensible and maps out perfectly as well. However (and here's the culprit), an organization that sets up new services on a frequent basis might get accustomed to certain values, and these values might not be as easy to approach in a public cloud environment. Furthermore, the organization might not be accustomed to different disaster scenario's for the SLA: having different sets of RTO/RPO depending on the category of disaster.
Let's get back to the region-wide disasters. A company might have decided not to have region-wide proactive measures in place, and fixate their SLA non-functionals on local disasters: a data center failure is considered a threat that still requires proactive measures, whereas regional failures are treated differently. The organization decides to only have one SLA set defined, and includes RTO and RPO values based on the current, local threat matrix. They might decide that a majority of applications or services has a RPO of "last transaction", meaning the data has to be fully restored at the latest situation in case of a disaster.
This generally implies synchronous replication as an infrastructural solution. If the organization is used to having this method available (for instance through SAN replication, cluster technologies, database recovery, etc.) then they won't sweat at all if the next dozen services all require the same RPO.
But now comes the public cloud, and a strong point of attention is region-wide failures. Doing synchronous replication across regions is not a proper tactic (as it implies significant performance degradation) and especially not sensible to do at the same scale as with local replication (e.g. between availability zones in the same region). Now you have to tell your business that this RPO value is not easily attainable in the public cloud. The public cloud, which solves all the wonders in the world. The public cloud, which has more maturity on operations than your own company. Yet you can't deliver the same SLA?
Apples and pears. The disasters are different, so your offering might be different. Of course, you should explain that your 'on premise' disaster scenarios do not include region-wide failures, and that if you include the same scenarios for 'on premise' that that RPO value would not be attainable on premise either.
The public cloud provides many capabilities, and has to deal with a significantly larger environment than companies are used to. This also means that disasters that are considered 'extremely unlikely' are now 'likely' (given the massive scale of the public cloud), and that the threats you have to consider while dealing with disaster recovery have to be re-visited for public cloud enabled scenarios.
My recommendation is to tackle the disaster-oriented non-functional requirements by categorizing the disasters and having different requirements based on the disaster at hand. Mature your cloud endeavours so that regional outages are not a problem anymore (moving them away from the 'disaster' board), and properly map all dependencies you have through the public cloud exercises so that you can build up a good view on what possible threats exist that would require a well-coordinated approach to tackle the event.