Guest blogging for the Aurora EDI Alliance is Yehuda Cagen from Xvand Technology Corporation, a Houston cloud computing company.
Cloud computing's value varies by the size and makeup of the client organization. The cloud provides Fortune 500-level IT capabilities to the small and midsize sector minus the key capital expenditures.
On the surface it would seem that cloud computing services best serve organizations that are firmly established with a less-than-robust IT system already in place. However, we’ve recently engaged with a small law firm who had recently disbanded from a larger firm simply because the managing partner refused to put a "dollar sign" on the security of his clients' confidential data.
The bottom line is that like EDI, each cloud computing benefit should always be tied to a specific business benefit. If it meets that specified criteria, the cloud should be viewed as a viable alternative to on-premise IT.
There are many variations of cloud computing services. Let’s explore two models at different ends of the “cloud spectrum”:
The business world is most familiar with a cloud-based data backup model that replicates your data to their offsite servers. So, imagine a scenario in which your on-premise systems crash and cannot be restored. The first step is to replace the systems that crashed. Next, the data must be retrieved from the cloud computing provider and restored to your new on-premise systems. Also remember that the data must be compatible with your new systems.
So the key question is, “How long will the entire data restoration process take?”
Conversely, the more comprehensive cloud computing solutions use a different model in which ALL data, files and software applications are stored offsite, including EDI software and other applications or data that pertain to EDI. In this model, there are no on-premise systems. Most cloud vendors have redundant (duplicate or triplicate) system components in place in the event one component fails. Contrary what some cloud providers might allege, there’s no such thing as “100% uptime.”
However, let’s say that even with all the safeguards in place, the cloud system experiences a 20-minute outage. While the client company may lose access to data, there’s no need for the client to retrieve or restore data to new systems. In this instance, the cloud vendor will find and resolve the issue and the client can continue operations as usual.
Here are ten reasons to move to a cloud computing provider:
- Speed to Market. Starting with a pre-built, enterprise-level IT foundation allows clients to accelerate launch times of projects and businesses.
- Lower Financial Risk. Reduce the risks of on-premise solutions that require upfront capital expenses with an uncertain payoff.
- Greater Financial Visibility. A cloud-based managed service provider helps executives more accurately forecast the costs of adding new users or locations.
- Improved Cash Flow. Avoid assuming debt and keep cash in the company longer.
- Free-up Internal Resources. Internal IT talent can focus on software applications and the associated innovations that drive business rather than engage in daily rounds of infrastructure troubleshooting.
- Better IT Budget Forecasting. Unexpected server crashes, security threats and upgrades only increase budget uncertainty. Since in most cases, the cloud computing provider assumes all capital IT and personnel costs, firm management only needs to forecast for a consistent, monthly per-user fee. This simplifies the task of budgeting for potential growth, particularly with complex expansion or merging projects, when headcount is increased or reduced.
- Adaptability to Evolving Market Conditions. In the cloud, firms can leverage the provider’s enterprise-level IT resources and deploy them as-needed. This helps break the cycle of recurrent IT expenditures and positions the organization to adapt to evolving market conditions.
- Improved Risk Management. Simply put, the more IT investments, the greater the risk. Cloud providers reduce the organization’s dependence on onsite systems by assuming the costs and risks of the entire IT lifecycle: hardware, backups, security and support. The firm can pursue growth opportunities without incurring the risk of significant capital outlays.
- Disaster recovery. Rather than having to constantly back up files (and retrieve and restore it after a disaster) clients rely on the cloud computing provider’s data backup and protection procedures. The key question to ask any provider, especially with disaster recovery, is, “What’s the recovery interval?” In other words, how long will it take to restore normal business operations after a disaster?
- Greater Employee Morale. Downtime reduces employee productivity and firm output. Cloud solutions enable employees to work from home using the same familiar desktop interface, thus drastically reducing commute time and improving employee morale. Remote users have ubiquitous access to the provider’s support team. Most providers have executive-focused management consoles that enable managers to monitor employee activity remotely.