Cloud computing is more than an IT buzzword. With the worldwide cloud computing market estimated at $10.7 billion (the U.S. accounts for approximately 40 percent of that total), cloud computing is quickly becoming the technology of the future. In fact, according to Microsoft CEO Steve Ballmer, 70 percent of Microsoft employees are doing work that is related to cloud computing, and that figure is expected to continuously increase.
So what is cloud computing?
Simply put, cloud computing is a model in which services and storage are delivered through the Internet instead of a desktop application. Sometimes referred to as ‘software as a service’ (SaaS), a true cloud-computing solution requires no software to purchase and install. Many cloud computing applications have become so commonplace that you probably don’t even realize you’re using them. Internet-based email, document managers and anti-spam/virus programs that update and secure your desktop applications are just a few examples. Along with smartphones, tablets and other technologies, cloud computing is redefining how we work.
Cloud Computing and Small Business - A Perfect Match Made?
With applications available for various business functions and technical needs, it is not surprising that small and mid-size businesses are significant consumers of cloud-based solutions. In fact, a recent report from AMI Partners predicts a 25 percent increase on SaaS spending versus five percent growth for all other categories of on-premise software combined.
The two biggest benefits of cloud computing are convenience and cost. By releasing operations from data centers, file servers and packaged software, cloud computing offers small businesses a high level of flexibility and it allows business partners and employees to connect easily. Another added benefit is that cloud applications are scalable and can grow alongside your business. Applications get updated and improved regularly without the cost and effort of downloading and configuring upgrades. Moreover, the solutions are inexpensive. Generally billed in relatively low monthly installments (which could be adjusted according to the number of users, transactions, etc.), cloud computing tends to be substantially more affordable than the initial investment required for physical data infrastructure and software. Some prominent SaaS vendors include: Omniture, Taleo, SuccessFactors, NetSuite Microsoft, IBM, Google, etc.
Similar to any other type of technology product, you should consider security, uptime (essentially a hosted application’s performance record) and privacy concerns when evaluating whether cloud computing is a good fit for your business. Though SaaS applications may actually offer added protection against issues such as data loss, you should ask vendors for written documentation detailing their security measures and standards. When evaluating uptime, the performance record should be in the range of 98-99.9 percent, (accounting for maintenance or unexpected problems). You should also inquire how long it generally takes to resolve technical issues.
While cloud computing has many benefits, there is no “one-size-fits-all” recommendation. Determining whether cloud applications are right for your business –and to what degree– is a decision that will need to be based on your company needs. It may be worthwhile to kick the tires before committing. In fact, many cloud services will offer a trial prior to purchase.
If you choose to pursue a cloud computing solution, the following are some considerations you should keep in mind:
- Ensure that the vendor offers good customer support and check to see if there is an added charge for support and maintenance.
- Look for a flexible cloud computing vendor that will allow you to add and subtract users and scale other capabilities as your business needs change.
- Determine whether your cloud computing solutions run on complementary interfaces. For example, it may be useful if accounting packages integrate with contact management applications.