What is 'Cloud Computing' and how can it benefit my business?


By SpiderGuest

General
25 November 2008

What is the ‘Cloud’?

Cloud computing is a recently coined but popular term for the delivery of information and services to one’s computer, over the internet (or ‘cloud’). Why ‘cloud’? Well, if you’ve ever had the pleasure of reviewing network diagrams you’d know that the internet is generally depicted by a cloud. My guess is that the Internet has become such a vast, unfathomable network of information and services that no one can really explain it – so we just call it ‘the cloud’ and take for granted all the really clever, interesting and weird stuff that happens in there.

Personally I’m not sure that l like the term, I run a business and the image of my information floating around in some vast cloud makes me a little uneasy, fortunately I know better and if it’s the term that’s going to stick then I need to join the party. Whether it will stick is another matter, the most recent fad was calling it web 2.0 and the slightly less catchy software as a service (or SaaS), not to mention on demand services and application service provision (ASP). But all these terms essentially refer to same thing; the delivery of services and information over the internet to billions of consumers and millions of businesses all over the world.

Give me an example…

To take a practical example of cloud computing, we’ll look at small business accounting software as this should apply to the broadest audience.

Standard Computing: Sage Line 50 is by far the most popular accounting solution for small businesses in the UK and those of you who have used this software will know that, like all standard software, it needs to be installed and maintained on a computer in your office. This can cause a number of headaches for business owners and financial controllers such as; accessing accounts information when you’re not in the office, working across multiple locations or from home, upgrading software and hardware and backing up your data.

Cloud Computing: QuickBooks Online is an American accountancy package that has been re-developed in a web-technology that allows it to be delivered as an online service. This means that it can be accessed via any web browser, all you have to do is go to the home page, enter your security information and start using it. You can print, export and report on information just as you would with standard software but you have the added convenience of paying for the service on a monthly subscription, with no up-front capital expenditure. I believe that QuickBooks Online is currently only available in the US but other online accounting packages such as KashFlow are available to the UK market, I should state that I am only highlighting the Cloud Computing concept and not the quality of the accountancy packages themselves!

And the benefits are?…

So with the example of your financial systems, lets look at some of the benefits Cloud Computing can deliver to your business:

Work from the office, home of on the road: With cloud computing you’re not limited to working from any one computer, you can access the software from any laptop or PC, anywhere you can get an internet connection, which is great for productivity when you’re on the road or for flexible working for your workforce.

Share real-time information with colleagues and clients: Almost all web-based applications provide role-based access to information and reports which means you can collaborate with colleagues in different locations and provide better service to your customers.

No hassle with software and hardware: You don’t have any hardware in-house, so you don’t have the hassle or worry about servers failing or hardware upgrades, you don’t even technically have any software so no more painstaking installations or desktop troubleshooting.  

Lower cost of ownership and no up-front capital expenditure: I’ve been through the process many times, ask for a quote for a software package, get a quote for the software, software support, additional licensing, a server, backup equipmenthardware support, delivery and 3 or 4 day’s labour to put it all together. Before you know it you’ve spent over £10k up front and 1k per month for the rest of your business life for something you’re probably going to have to upgrade in 3 years time.

Securely backed up data: Most data on the web is backed up at least daily and i know for our database applications you’re looking at an hourly backup cycle so your business information is safe in separate geographical locations at all times. Software providers that host in the cloud can afford much more advanced firewall and security systems than most small or medium sized businesses and only the best technical teams to manage them, your systems are probably in better hands with them than in your own offices.

So is Cloud Computing the way to go?…

I would be so bold as to say that every business could benefit from a little bit of cloud computing but at the moment I see it suiting small businesses (1-50 staff) who are flexible and forward thinking multi-locational large businesses (100+ staff) who can afford to think outside the box. The in-between Medium size businesses tend to have invested heavily in skilled personnel and equipment and only have 1 or 2 locations – besides, what would all their expensive staff be doing if not managing VPN connections, monitoring hardware and applying software updates?…

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