As a newcomer to technology, or someone who has better things to do that get your hands dirty with it, cloud computing might just be the best thing since sliced bread for your business.
The facts are simple. Before the internet came along, you would purchase software, usually with a licence, and install and run it on your computers – rather like buying a music CD and playing it in your house. Under the Cloud model, the software is run online by a third party provider, and you access it through your internet browser. You never install anything on your own computer, and you never actually ‘own’ any software: rather than buying a product, you’re renting a service.
So far so good; but tech folks are really excited about cloud computing. Analysts 451 Research say that cloud computing in 2013 will be a $16.7bn industry. To understand why it’s such a game-changer, we need to look in more depth at the reasons why the cloud (also, for the reason above, often called ‘Software as a Service’ or SaaS) is so different, and how it creates business-friendly benefits.
Make IT someone else’s problem
First off, there’s just no technology for you to worry about. When you rent a car, the maintenance, repairs and breakdown assistance are all taken care of by the rental company. You rightly expect to be able to jump in and drive off, safe in the knowledge that your car will work. The same is true of cloud services: when you sign up, you get to use the software without worrying about installing it, maintaining it, downloading updates or keeping it secure. You also won’t need a server or any of the other additional IT investment that larger suites of software used to require. All that is taken care of by your service provider.
David S Linthicum, SVP, Cloud Technology Partners; author, blogger at InfoWorld, and host of the highly successful Cloud Computing Podcast, says, “With cloud, you have the ability to push the operational IT work to other people. This shifts the risk to the cloud provider and away from the enterprise, which is a good thing.” By effectively outsourcing the technology, you’re reducing the risk, and unexpected expense, associated with your in-house IT (even if it’s just a couple of laptops) going wrong. Adds Linthicum, “Thus, you can focus on the core issues around IT: defining and implementing core business processes.” This is a point which is often forgotten. If you can spend less time ‘keeping the lights on’, you can spend more time making your technology do useful things which meet the needs of your business.
Predictable and economical – a business-friendly financial model
The greatest benefit of the cloud, however, is financial. Let’s return to the rent-a-car analogy. When you buy a car, there’s a huge upfront expense. You don’t get that money back if you don’t use the car every day, or even if you sell it on. After five years, you’ll have an old car which nobody else wants to buy, and if it goes wrong, it will cost ever more to repair. Your rental car, however, is always a current model, and you only pay to use what you need, when you need it.
This is exactly the case with cloud services too. There is no upfront cost. You’ll pay a low, predictable, flat-rate monthly fee per user for the software that you use; and that means that you can scale up or down as your business needs demand. When you take on more staff, you can switch on new licenses immediately, and similarly turn off the tap if you scale down. Says Linthicum, “I don’t have to continuously purchase hardware and software to keep up with capacity requirements. Cloud computing provides you with the ability to expand or contract the number of resources you’re leveraging. Thus, the spend on technology – which used to be a major capital expense for even small businesses – now becomes an operational expense. The biggest benefit of cloud computing is agility, the ability to change, to adapt to the emerging needs of the business.”
Unlike installed software, you will also always have access to the latest version. When a new version of a service is released, it is instantly made available to all subscribers, giving you access to tools which will keep your business at peak competitiveness.
Running software online also brings with it some inherent benefits:
Work from anywhere: Software which was installed on a computer only ran on that computer. Today’s business owners work from home and airport lounges as well as the office; and with the cloud, you will not only always have access to your software, you can also log in and simply pick up where you left off.
Collaborate with colleagues, clients and suppliers: You can share access to your cloud workspaces. That means you can work on documents, proposals, presentations etc. with other people, and expand the boundaries of your office to clients, too.
Cut the risk of crisis and speed up disaster recovery: One of the key economies of scale involved in cloud computing is that a good cloud provider will have better security and resilience than you can ever hope to afford. They will store your data safely and securely. If your office was broken into (or, more likely, you leave your laptop on a train), your data is still safe and immediately accessible online from another machine.
The security question
These stack up to a pretty compelling argument for the cloud for small businesses; but there is also a degree - although rapidly diminishing – of ‘caveat emptor’: buyer beware. Putting your business-critical information in the hands of a third party demands a degree of trust. There are plenty of smaller software providers, often based in countries which would offer you dubious legal recourse if things went wrong, who would find it very hard to prove their security or resilience credentials. Going back to our rent-a-car example, you would probably feel safer with one of the major providers than with a wheezing old jalopy from ‘Bob’s Truck-U-Like’.
Solid providers will explain their security methodologies and commitment to you. Microsoft’s Office 365, for example, has a Trust Center here, with documents which clearly outline their promise. Your provider should also give you an SLA, or ‘Service Level Agreement’ which commits to delivering, for example, a guaranteed level of ‘uptime’ (i.e. ensuring that their service will be available for e.g. 99.9% of the time). Linthicum says, “While you can certainly put an SLA in place to guarantee uptime, there are no complete guarantees when moving to cloud computing. The comfort factor will come, with time, as we understand the true reliability of leveraging public clouds.” You are opening a key aspect of your business to a third party, and it’s your duty to yourself to minimise the risk of doing so. Rest assured, if that third party is reliable, they will do a better job of looking after your data than you could by yourself.
Plus, the range of cloud delivered software is now as broad as anything you might buy in a shop. The Office 365 package includes email, calendars, conferencing, website building tools and access to the Microsoft Office desktop tools used by millions of businesses worldwide. Other services will keep your computers secure, manage projects, help you stay in touch with your customers, and indeed anything else you can think of – including plenty designed for specific business sectors. Few businesses today can escape technology completely, and few should want to – it’s a key driver of commercial competitiveness. But the cloud can make unlocking that competitiveness simple, flexible and free of upfront expense.