How Can a Small Business Transition to Cloud Computing?

By Curt Lewis

Like a thunderclap, cloud computing is quickly moving from an emerging technology to a standardized solution.

Gone are the days when only large enterprise companies would benefit from the latest and greatest technology such as cloud computing. The cloud has reached Main Street, and has done so by providing efficiencies, simplicity and ROI for small business.

How Can the Cloud Provide ROI for Small Businesses?

One of the clear investment benefits of moving to a cloud environment is the reduction of expenses devoted to an IT infrastructure (hardware, servers, etc.) and overall IT operating expenses. ROI can be quickly realized through automation, inevitably reducing overall personnel and staff dedicated to manual support services.

Many small companies lack the resources to support a full-time IT staff complete with hardware and servers to maintain or grow their businesses. The cloud environment is highly affordable and scalable, allowing small businesses to enter into the space with minimal risk — and maximum return.

In most cases, cloud computing service providers offer all of the resources required — including hardware, power, and bandwidth — and typically provide the majority of the IT support. And, most cloud services are “pay as you go” enabling you to manage your IT expenses on a more demand-driven basis. Both of these attributes result in reduced overall IT costs.

Outsourced cloud computing solutions are dynamic, scalable and are cost-effective, providing a manageable solution for small businesses. Additionally, cloud computing solutions achieve a better response time in most cases than standard server hardware.

Cloud services also help reduce downtime, typically with redundancies which are built-in to ensure quick, easy access to data and server resources.

True Savings: Managing the Cloud Cost-Effectively

Beyond minimization of IT costs, many of the initial savings and cost benefits from moving to cloud computing can be found in the following services:

  • Hosted E-Mail: There are many providers for hosted cloud e-mail, such as Microsoft Hosted Exchange/Office 365, Google Apps and Rackspace e-mail. These are low cost and low risk, and are easily moved to the cloud. With rates as low as $5 to $10 per e-mail box for hosted Microsoft Exchange, Google Apps and other cloud e-mail providers, it makes financial sense to move e-mail applications to the cloud first. There is no initial capital expense and you receive support from a managed service provider (such as LinkSource Technologies) or the cloud service provider directly.
  • Web Hosting: Web hosting can be done affordably and reliably in the cloud. The provider should be evaluated based on your site’s specific requirements and security, but there are numerous public and private cloud vendors to choose from in the market. Website hosting typically applies to your corporate site, intranet, extranet or marketing sites. Companies can affordably move the web presence to the cloud from prices as low as $5 per month, as well. This of course depends on your current site requirements, load, security concerns, overhead, database requirements, etc. Through providers such as Rackspace, Microsoft Azure and Amazon, you can easily and affordably move your web presence to the public cloud.
  • Application Hosting: Moving your internal applications to the cloud is a strong next step. This is affordable, and can be secure and scalable. If your application has times of the year that it is busier, you can scale during that time only and pay for what you use. It keeps costs down and performance and reliability up. If your applications require security and compliance, a private cloud may be in order. LinkSource Private Cloud, Terremark Private Cloud, or Rackspace are all strong options.
  • Software as a Service: Moving applications to service providers such as SalesForce.com, QuickBooks online and Microsoft SharePoint can eliminate capital expenses and increase reliability and offerings to end users. These providers offer low cost of ownership and no upfront capital expense for hardware, software and information technology management.
  • Storage as Service / Disaster Recovery: Storage and disaster recovery is another low-cost, low-risk item to move to the cloud. You can store data remotely for as little as 10 cents per GB or up to $3 per GB, depending on your security and compliance requirements. This offsite storage will eliminate the need for data and media backup services and remove hardware such as tape backups and Backup Exec. There is almost immediate ROI moving data and backups to the cloud. However, one must consider the volume of data, the time to recover, security and compliance. If a server goes and you need to restore, you may have to wait several days to download 2 TB from the cloud, or make sure your provider can provide you with a hard copy of the files within 24 hours.

Private clouds offer security and compliance such as SAS70, Type II, PCI DSS, HIPAA and the Sarbanes-Oxley Act. These solutions are a bit more expensive, but provide security and peace of mind.

What Lies Ahead?

Information Technology is in transition: The “new model” of cloud computing is targeted to be more flexible and cost-effective for business. Around business continuity, the cloud has the potential to make backup and recovery available to a wider section of the market, providing advanced-level functionality that is aimed at the enterprise while still keeping costs low enough for all companies to benefit.

The cloud has moved from being an enterprise solution to a small-business solution. All attributes and benefits applicable to a  Fortune 500 business model can now be adapted and migrated to a small business environment.

Should you be in the cloud?

Yes. But it’s critical to take the time to thoroughly understand how it can help you scale your business to meet your short- and long-term goals.

Curt Lewis is the CEO and co-founder of LinkSource Technologies. A Vistage member, he is responsible for the entrepreneurial leadership of LinkSource operations. Under Lewis’ direction, the company has become one of the nation’s leading IT consultancies, successfully delivering innovative technology solutions for many of the world’s most recognized brands.
Originally published: Aug 31, 2011

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