How Cloud Computing is Reshaping the Economies of Small Businesses

How-Cloud-Computing-is-Reshaping-the-Economies-of-Small-BusinessesCloud computing isn’t completely a new concept. Large organizations are known to use cloud technology for quite some time now, but recently there has been a shift in focus, which has brought small businesses to the forefront of discussions on receiving cloud computing benefits.

Industry experts and cloud hosting service providers alike are considering ways to enhance the performance of small businesses through hosted service solutions. So, what has made them think that small and medium businesses can be ideal candidates for receiving cloud computing benefits?

Before Cloud was Introduced

Well, cloud has many attributes that can work in favor of resource strapped small businesses; such as – cloud has transferred the need of maintaining a robust IT infrastructure in-house to run IT functions to a virtualized environment.

Before the introduction of cloud, firms were required to maintain a fully functioning IT infrastructure and team to keep the clogs of their business moving. It was however expensive and many SMEs found their IT budget to go through the roof because of that. Besides, there were also questions of wear and tear and hardware upgrade, which increased budget overheads further.

Businesses were required to have their sets of dedicated servers in the traditional setup to host critical business applications and data. This was again an expensive investment for small businesses which has limited available fund.

Cloud computing came as a blessing to many SMBs which are at the verge of expanding their operation and need support of the latest technical innovations.  It has made it possible for SMBs to access improved technical solution at a rate that is affordable to them.

Cloud has made IT available on-demand basis, i.e. the user is free to select and adjust his IT resource requirements in a scalable climate. It has made resource procurement easy and automatic. Users now can set up their virtual servers in a shared resource pool and can adjust its capacity based on demand.

Cloud hosting service providers have allowed users a flexible IT climate that is responsive to their changing business needs when the customer doesn’t have to worry about setting up his in-house IT infrastructure.  With cloud, hardware, storage, server, APIs, middleware and even business applications are delivered over the internet.

The Rise of Software as a Service (SaaS)

Although infrastructure as a service (IaaS) solutions are most widely available software as a solution services are more commonly known. It is when software or applications are rendered over the internet and accessed on web browsers by end users. It has freed the users from buying licenses as required for legacy applications and allowed them to get customized solutions for their business needs.

With SaaS solutions the responsibilities of maintaining hardware and software rest with the service provider so that the user can thrive in a worry free environment. The costs of the services are rolled into monthly subscription charges.

The costs of these software solutions are much less than legacy applications – normally charged on per user basis, which has made it easier for businesses to introduce new users as they grow.

Business intelligence application suite and customer relationship management software have made SaaS a really popular choice with small and medium entrepreneurs. Web based CRM applications have helped adding advantages of effective customer management and dynamism to B2C and B2B companies. Earlier the costs of sophisticated business applications were beyond the scopes of small enterprises.

These applications are designed to be delivered on thin client setup and therefore can be accessed on smartphones and tablets.  Small businesses that are driven by their sales teams have found web based solutions particularly suitable for their dynamic business environment.

Eliminating Security Issues

Protecting your business critical information can be quite an ordeal in the face of increasing data security threats.  Hackers always seem to be smarter for your security barriers. You would need a dedicated team IT professionals to constantly monitor the performance of your data to ensure its safety. That is not a feasible solution in the resource constrained setup of a small business.  In these circumstances, data security breach or an error can go unreported for months. Cloud computing can eliminate these issues.

The service provider possesses both means and skills to offer advanced level security solutions to customer data. He can employ a dedicated team to monitor data movement in a cloud climate and report and fix an error as and when it occurs. Replicating the same level of security standard in a small business environment is economically nonviable and technically unachievable. Hence, we can conclude that cloud offers economies of security to small businesses.

The Present and the Future of Cloud in SMBs

Cloud computing definitely has a future as an all encompassing enterprise IT solution provider. The cloud adoption rate among small businesses is slowly picking up but it is still required to cover a long distance. Many of the SMBs are still vague about the economies of scale that cloud can introduce in their business model.

The boastful promises made by many service providers aren’t helping to the cause. So, although SMBs are embracing hosted solutions very few are deriving actual benefits out of it. There are still many pitfalls to be avoided to choose the right cloud computing model. This true objective can only be achieved by creating awareness among small and medium businesses regarding cloud computing solutions.

For more information ask Charles Smith who is associated with the IT industry for over a decade now. He is a senior consultant with Corelynx Inc. For the last 4 years he is engaging to develop cloud based software for his clients. Charles has vast experience in implementing cloud computing projects and offering consultation to companies in mapping their ways in cloud environment.