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Dec 7, 2013

Cloud Computing And Small Business

In today’s competitive environment, many small businesses are seeking solutions which reduce the cost of IT infrastructure, control capital expenditures, and unify business operations. Companies must accomplish this while meeting demands for higher levels of service to maintain a competitive advantage in this fast paced marketplace.

The desire by companies to reduce IT costs while improving quality of service has placed many small businesses at a decision crossroad concerning whether to migrate to the cloud or maintain IT on the premises. As with any other type of business decision, there's advantages and disadvantages as well as challenges which must be taken into consideration prior to reaching a decision.


Many companies that consider migrating to the cloud often discover its powerful potential to provide cost savings and reduce IT infrastructure requirements while simultaneously providing a more efficient way to deliver services to the end user. Because of the many benefits and potential that cloud computing represents, more companies are embracing the use of cloud solutions.

Why are Businesses Migrating to the Cloud and what are some of the Current Industry Trends?

Although many people are unaware of it, we have already been accessing applications in the cloud long before the term became widely accepted. The applications we access over the Internet such as discussion groups, web-based email, certain software programs, and other applications are really cloud-based applications and are predecessors to the cloud technologies as we know them today. Additionally, the increased popularity of mobile devices has only fueled the demand for mobility; making a strong case for organisations to migrate to the cloud. Consider the following: 

According to Gartner, a leading information technology research firm, The use of cloud computing is growing and by 2016, this growth will form the bulk of new Information Technology spending

Forrester, a global research firm, recently conducted a survey on cloud computing. According to them, 72 percent of CIOs who were surveyed agreed that senior management should view migration to the cloud as a primary method for reducing costs and responsibilities associated with IT implementation and maintenance. Additionally, 58 percent of survey participants indicated that they are currently running mission critical applications using a cloud solutions provider.

So, why are more businesses switching to cloud computing solutions? The answer lies in the numerous benefits that cloud computing provides. 

Reduced Total Cost of Ownership (TCO): 

Businesses are opting to use cloud solutions to save on the costs of large upfront capital investments, data center space and maintenance requirements, and the operational costs associated with maintaining IT infrastructure on a day to day basis. With cloud computing, the IT infrastructure being maintained by cloud solutions providers, businesses can be up and running quickly and with access to the latest technologies at a fraction of the cost of implementing and maintaining IT on the premises. Reduced cost of ownership and the transition from a local network is one of the main reasons why so many IT companies are now offering cloud services, this IT company being a prime example. 

Improved Risk Management and Disaster Recovery

Cloud computing offers businesses the opportunity to reduce risks associated with IT planning and implementation, issues related to scalability and growth, and data loss resulting from an unexpected natural disaster or system failure. 
  
Improved Security:

Using a cloud solution, businesses are able to gain access the latest advances in security technologies without the expensive price tag of maintaining and meeting security compliance standards; both regulatory and industry-specific. 

Access to the Latest Technologies: 

For many small businesses, implementing the IT infrastructure which is necessary to access the latest technologies is usually cost prohibitive. Cloud solutions place innovative technologies within reach of a small business budget.  

Budget Optimization: 

The cost savings that result from using cloud computing services allow businesses to reinvest in new initiatives to facilitate company growth. This also allows IT professionals to focus on important initiatives instead of constantly dealing with IT infrastructure issues. 
  
Competitive Advantage: 

By using cloud solutions, businesses reduce their time to market owing to the speed and stability of a cloud computing service. Cloud computing initiatives also allow enterprises to create, develop, and test solutions at a moment’s notice; thereby increasing organization productivity. 

Mobile Ecosystems:

Consumers are becoming increasingly mobile and they expect businesses to provide them with the mobility that has become a part of their daily life. For small businesses this can represent a costly proposition when implementing the services on the premises. By using a cloud solution, small businesses can easily meet the demands of the mobile consumer as well as increase accessibility to applications by staff members. 

What are the Different Types of Cloud Infrastructures and why are They More Cost Effective?

If your company is considering migration to the cloud, there are multiple options when it comes to cloud infrastructures. A few of the common architectures include but are not limited to: 

Infrastructure-as-a-Service (IaaS): IaaS is basically a method used to access computing applications by renting server space from an IaaS provider. The infrastructure is then maintained using a single interface capable of performing maintenance, monitoring, upgrades, and other tasks associated with business change. This allows the company to focus on using applications instead of being required to purchase IT infrastructure to implement applications on the premises. 

In the current industry, businesses use IaaS as to carry out data-intensive tasks, perform core database functions, data backup, efficient disaster recovery, data storage and security, as well as access a Web Service Interface for accomplishing administrative tasks. This is accomplished at a fraction of the cost of IT infrastructure maintained on the premises. 

Platform-as-a-Service (PaaS): PaaS is the offering of an entire computing platform by a remote PaaS provider for access by businesses and end users. This removes the complexities associated with setting up the IT infrastructure while making the process of creating web applications faster. 

More companies are opting to switch to PaaS due to its potential to deliver on-demand solutions that provide a one-stop environment which offers all the required tools, systems and applications that help businesses to remain competitive and improve customer retention. PaaS also prepares a company for emerging industry trends that are on the horizon such as the increased use of mobile devices and for much less than what it would cost to implement the technology in-house. 

Software-as-a-Service (SaaS): SaaS is software that is available on-demand from a SaaS provider which the end user accesses in the cloud. SaaS is used to alleviate the soaring costs of enterprise software which makes it an enticing option for many businesses. 

Companies already using SaaS have reported an increase in productivity and customer retention due to the ability of SaaS to provide pre-built and customized applications, automated processes, and business intelligence without the costs of maintaining and updating IT infrastructure and the software which runs on it.

What are some of the Challenges Associated with Cloud Migration?

Although cloud computing offers many benefits, it goes without saying that some businesses are reluctant to make the transition due to some of the challenges and concerns associated with migrating to the cloud. 

If you are aware of the challenges associated with transitioning to a cloud environment, it makes it easier to assess and manage the risks and concerns during the planning phase. Here are a few of the common concerns when considering the transition to a cloud model: 

Knowledge and Expertise:

In terms of staffing, many small businesses often lack the knowledge and expertise necessary to successfully transition to the cloud. For this reason, it is important to make sure that your cloud services provider has the necessary knowledge and expertise readily available within their organisation to ensure a successful transition for your business. 

Data Security: 

The security of important business data is the primary concern for most companies when it comes to considering cloud solutions. Most reputed cloud solutions providers have gone to great lengths to deploy architecture that addresses data security concerns by implementing multiple high security storage locations and providing disaster recovery solutions that can be implemented at the click of a link. 

Compliance: 

Compliance with regulatory and industry standards on data security is one of the biggest concerns for most businesses. This also raises concerns in terms of how to remain in compliance when working with a cloud solutions provider. Businesses currently using cloud computing solutions work around this by meeting compliance onsite and then choosing a cloud computing service provider that can match the industry and compliance standards from their standpoint. 

Selecting a Cloud Vendor

Selecting the right cloud service vendor is one of the most important decisions to make while making a transition to the cloud. Important considerations would include the suitability of services provided to your organisational needs, the reputation of the vendor, the levels of expertise and the extent of guidance available, payment options and a lot more.

Transparency: 

Transparency is sometimes a concern when it comes to switching to cloud solutions. Some businesses are not comfortable with the idea that someone else is managing their IT infrastructure from a remote location. The companies that are successfully using cloud solutions work with the cloud services provider to ensure they have a common understanding of the services to be provided as well as the mechanism of monitoring these services. This is typically accomplished using a well-defined contract and Service Level Agreement (SLA). 

Service Level Agreement Monitoring: 

Cloud computing raises concerns with regard to who is responsible for monitoring Service Level Agreements (SLAs) and assuming liability for data breaches. Businesses that use cloud computing resolve this concern by working with the cloud service solutions provider to establish an agreement on the services that the cloud solutions vendor guarantees and the responsibilities that are imposed upon your company. 

Cost: 

Although results have proven that cloud computing solutions reduce company costs, businesses are still hesitant to transition to cloud computing services out of concern for hidden charges and other costs that may not be communicated upfront at the time of service initiation. 

The Final Few Words

When approached properly, transitioning to a cloud solution usually wins hands down due to the cost savings and pay-as-you-go option which adds flexibility and scalability while allowing your business to grow using the latest innovative technologies available.

When it comes to cloud versus on premise solutions, the cloud will provide your business with the most leverage. This is especially true if you effectively establish a balance between the risks and the benefits by acquiring knowledge about your team's capabilities, the solutions which are required to maintain a competitive advantage, what technologies will ensure customer retention, and work closely with the cloud service provider to ensure every requirement is met. This will ensure proper performance, security, and high end support, as well as guarantee a smooth transition to a cloud hosted environment.

The bottom line is cloud solutions can have a very positive impact on a business which is why it is important for your company to acquire comprehensive knowledge before initiating a migration to the cloud. Because the impact on a company is so significant, a competent cloud solutions provider will be an invaluable resource to ensuring successful migration from a costly on premise IT infrastructure to a cloud solutions environment.

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