Techblog
How cloud computing meets SME needs
Cloud computing has the answer to many SME concerns - whether it is cost, flexibility or business agility. Read on to find out more.
By the myBusiness techblog team
You may not realise it, but you are probably already using cloud services - whether to backup your data on the Internet, free web-based email services, or storing photos and music online. They all work based on the idea of cloud computing.
Cloud computing is about the delivery of computing as a service rather than a product that runs on a system on your premises, where a grid of computers deliver software and data as a utility over the Internet.
How the cloud differs from server-based applications is that the users access a pool of resources that reside in this cloud infrastructure, regardless of the hardware it runs on.
For small and medium-sized enterprises (SMEs), cloud computing has many advantages - mainly economic ones. As the data and applications are hosted remotely, it does away with the cost and burden of hardware and software acquisition, and maintenance. Essentially, cloud computing offers four key advantages for SMEs: flexibility, scalability, easy accessibility and pay-per-use models.
Economies of Scale
Cloud technology offers SMEs access to technologies that used to be available only to large enterprises with deep pockets. For instance, most sophisticated software like sales force automation (SFA) and customer relationship management (CRM) would have a large price tag in terms of the development or purchase cost, along with the powerful hardware to run the software, and the trained IT staff to manage the software. In contrast, many cloud-computing services have the option of a monthly payment, without the cost of upfront fees, or lock-in periods. You can be up and running in the time it takes to enter your business and payment information - all at a fraction of the cost of buying or developing this software in-house.
Running software off the cloud is also extremely flexible, as it enables a lot of software to be completely web-based. For instance, running an office productivity software for word processing or spreadsheets like Microsoft Office on your local desktops or server would mean having to choose an operating system and the relevant software that runs on your platform of choice. For cloud computing, the alternative is ONEOffice, where the only requirement is to have Internet access, without the need to install application programs on corporate systems or computer desktops. This spells huge cost savings as there is no need for storage and processing capabilities, and there are gains from energy savings.
Scalability is another key advantage. Given the global and competitive business environment of today, it is critical for SMEs to possess the qualities of adaptability and flexibility to react fast to market changes. Cloud based services are scalable on demand and are priced on a pay-per-use basis, where companies only pay for the IT services they consume. The pay-per-use model means companies only pay for the services that they need, and can scale up easily by paying for more users or modules when the business need arises, without heavy investments in equipment, applications or IT personnel.
Another advantage is the easy accessibility of cloud services. As only Internet access is required to access cloud services, it is platform independent, and cloud services can be accessed anywhere, and on any device - smart phones, desktops, laptops or other mobility devices.
Services Available
Essentially, there are three categories of cloud services available today. They include: Infrastructure-as-a-Service (IaaS), Platform-as-a-Service (PaaS) and Software-as-a-Service (SaaS).
IaaS is a cloud computing model where users can purchase hardware computing resources like servers and storage systems, as if they are outsourced services. PaaS is a layer in cloud computing that allows users to create new computer applications, while SaaS offers SMEs with access to a wide variety of applications provided by service providers and running on the infrastructure of the cloud.
In terms of implementation, there are three cloud computing models: public cloud, private cloud and hybrid cloud. The public cloud is suitable for most SMEs, where the service is available on the public Internet. Some organisations which have strong privacy or security concerns would prefer to use a private cloud, where the company owns and/or manages the cloud infrastructure.
The hybrid cloud is a combination of the public and private cloud model, where the company provides and manages some resources in-house and others are provided externally.
Ultimately, cloud computing is the technology answer to most SMEs, enabling them to utilise cloud platforms to focus on their core competencies and deliver their services reliably and without the hassle of worrying about the supporting technology foundation.