The Cloud Means Business for Entrepreneurs
The Economic Times, 11 April, 2011
A look at how the entrepreneurial spirit gets a fillip from cloud technology
An article by Rajeev Mittal, General Manager, Small and Medium Enterprises, Microsoft India
‘Business opportunities are like buses, there’s always another one coming.’ said Richard Branson. In a country like India, I’d widen the analogy multiple fold, for we have an innate predilection for business opportunity. Little wonder then that US President Barack Obama lauded our entrepreneurial spirit when talking to students in Mumbai during his visit to India earlier said that ‘India is making enormous progress in part because, like America, it has this incredible entrepreneurial talent, entrepreneurial spirit.’ he said. Yes, we Indians are buzzing with original ideas. And for an entrepreneur, these ideas become an all consuming passion. One just wishes every other cumbersome task involved in starting a business else took care of itself (or almost).
Enter: Cloud computing- a disruptive IT delivery model that allows businesses to consume IT solutions without bothering about running the back-end IT infrastructure. When businesses have access to IT as a utility or on a subscription basis – they preserve their capital and management bandwidth and instead focus on managing their business effectively. In essaying this role, Cloud Computing has true potential to be a business enabler – it fosters entrepreneurship.
The entrepreneur can focus on his/ her business idea and make it come true. To paraphrase the masterful Henry Higgin, ‘The Germans can be left to do their German, the Greeks to do their Greek’. Take the case of Bangalore-based start-up Metamorph, founded in 2008 to offer online Retail Employability Training Solutions. Starting off with a small, three member team undertaking training, developing training modules, handling accounts and finance all by themselves, it chose a SaaS based solution because needed a simple application that would undertake tasks such as tracking expenses incurred and raising invoices, without additional expenditure on IT infrastructure or IT staff. According to Suki Iyer, Founder CEO, Metamorph, ‘Redirection of resources is a hidden cost that often goes unaccounted for. The more time our employees would have spent maintaining equipment, downloading and installing patches, and supporting software upgrades, the less time would have been spent on our core business activities.” Take also the case of Bob Everett, President of Bottom-Line Consulting, a three-person firm offering various small-business services in the US. “We saved over $4000 in up-front costs by moving to an entirely cloud-based solution [for e-mail, Web hosting, virus protection, and more]. We were also able to substantially reduce our power bill and the costs needed to maintain and upgrade hardware,” said Bob as quoted in a PC World article earlier this year. That was $4000 freed up to be used in efforts to make rapid business success, in marketing, sales, people, what have you.
Start-ups have always been unwitting users of cloud-based applications as their limited IT budgets force them to use personal email solutions like Hotmail for business purposes. Today, however, the availability of enterprise-class applications in virtually all major categories – from email and productivity to CRM, ERP and upwards from several vendors has made the cloud a viable choice for businesses of all sizes and scale – without the worry of security breaches, and the ability to boast a ‘professional’ IT footprint. Besides, a one-man company will surely grow into a small business and then keep growing. An entrepreneur will need technologies which will grow and scale with the pace of the. Solutions in the cloud promise to become their partner in sustained growth. In this paradigm the sky is the limit!.
The financial and strategic advantages of embracing the cloud model deserve closer scrutiny by entrepreneurs. First, by taking away the ownership of the IT infrastructure and the necessity to ‘buy’ full-fledged software solutions, the cloud model allows businesses to convert their IT investments from a ‘Capital Expenditure’ to an ‘Operational Expenditure’ model – preserving precious financial resources that can be applied to other, more pressing needs like marketing or capacity enhancement. A business never has to ‘buy’ a cloud-based application; it can simply ‘subscribe’ to it or rent its usage on a metered basis, just like a utility.
Secondly, a cloud-based IT solution equates to near-zero application maintenance for businesses, for the maintenance responsibility shifts entirely to the cloud services vendor. It means that while businesses are guaranteed high availability of business application – enforceable with strict SLAs offered by the vendors –the cloud vendor works quietly behind the scenes to supervise and manage datacenter performance, apply application patches and install software upgrades among doing other maintenance work. For business users, it means having continuous access to their application that is always high-performing. Cloud applications are also geography and device-agnostic, which is a boon for today’s increasingly remote and mobile operations.
A third, closely linked advantage is near-instant infrastructure scalability, which is critical for many high-growth businesses as they continue to outgrow their IT quickly. Software offered as a service has this ability to instantly scale up, or even down, depending on the business need. Contrast this with the need to buy new hardware and software licenses in case of on-premise applications – often enduring months of limited IT performance while additional infrastructure was scoped and implemented.
Lastly, the lifeline of any business is its customer, or access to markets. The cloud does that in a jiffy. Examples abound of businesses even large ones leveraging the net to drive marketing to scale. The entrepreneur can set up an online shop, and use it as his primary market outreach, or secondary outlet, or even use it to test the viability of his business.
All in all, these advantages clearly establish Cloud Computing as more than just a disruptive IT paradigm> It will provide the fillip to entrepreneurship that has thus far prevented many ideas from taking flight – simply because of limited investing or market reach ability. With the entry barrier of ‘starting a business and reaching a customer’ significantly lowered, more people can now join the entrepreneurship train.
The cloud means business, and it is time we took notice.
This article was first published in The Economic Times.