This week we look at “the Cloud” from a business perspective.
What is the Cloud?
The Cloud is someone else’s computer to put in the simplest terms. But why would a business choose to use a computer that isn’t theirs and isn’t on their property? Adding to the confusion is the fact that the migration of business computing to the Cloud is more of a tsunami than just a mere trickle… so there must be some benefits, right?
Since the leap from mainframes to desktops, servers and laptops the standard has been for businesses to buy (CapX) their equipment and software. Then hire employees and consultants to get everything working. Equipment was only replaced when it died.
So what changed?
The business case for moving services to the cloud falls into several buckets, but there is a common theme, value. So what is the value proposition that has all these businesses using the Cloud?
The first driver was CapX versus OpX. Setting up a medium sized small business’ Exchange server could generally run $20,000 to $30,000. Wait 5 to 7 years and do it again, and again, and again! You look at services like Google, Yahoo, etc. and the fact they are providing email to consumers for free… something seemed out of whack! Yes there are reasons to have your exchange server in house and onsite, but that’s not the end of this model.
Then you have to buy business computers (CapX around a $1,000 per person every 3 to 5 years), servers ($10,000+ every 3 to 5 years), software and support subscriptions. The bigger you became the more IT salaries you had to add! Bigger companies realized moving to the cloud allowed them to shift expenses. By shifting budgets from capital to operating they had more money to invest in growth.
Generalist versus Specialist
Expenses weren’t the only motivator moving IT to the cloud. Enterprise businesses could hire IT people who specialized in a particular area. To work for a smaller business IT people had to become skilled in many different areas. One downside of IT people with general skills is their inability to become experts. Often with competing demands for their skills and time, focusing on one area is harder.
That’s what many businesses do when they hire their IT person/ staff. The makeup of IT departments changed as did their hiring practices. Companies are looking for individuals with a diverse set of skills.
Putting out fires, and tackling day-to-day tasks prevents IT departments from being strategic. IT departments should be a strategic asset. A strong IT department is a competitive advantage.
Outside of larger enterprises, organizations are unable to silo their IT resources.
More so now than ever before, Security is king! According to a report published by Cybersecurity Ventures, damages related to cybercrime are projected to hit $6 trillion by 2021. https://www.nisc.coop/blog/cybercrime-damage-projected-to-hit-6-trillion-annually-by-2021/ By 2023 it is predicted that 50% of all cyber attacks will occur in the United States!
What is the Security value of the Cloud?
This is where the first two points about owning and administering your own infrastructure meets with the notion of a specialist. Configured correctly, with the proper resources, both on-premise and Cloud can secure. The Cloud provider industry is built specifically for providing highly available computer resources utilizing a hardened, secure facility with specialists supporting each area of the operation. The cost of a single small data center is in the millions. The engineering requirements necessary to building out these highly specialized and redundant facilities is very expensive. Hiring multiple IT specialists to support each application is also quite expensive! Only the richest companies can even entertain that thought. The truth is those rich companies don’t build out those facilities any longer, they find a Cloud service which fits their needs and save their cash for more profitable initiatives.
Trust! The truth is you need to understand your data needs: compliance (HIPPA, PCI, etc.), availability of resources, redundant internet connections, is work from home on the docket? how much back up is enough, etc. Once you have a good idea what you need, spend currently, and what your business’ goals are you will need to shop for what kind of Cloud makes sense for you.
The three main types are Public, Private and Hybrid. Public examples would be Amazon (AWS) and Microsoft (Azure). Private would be working with a data center company to put your computers (or use theirs) into a secure facility with robust private lines connecting sites, and Hybrid would be a mix of Public and Private, putting the most valuable assets in a private secure facility and leaving other resources to live in the public cloud.
No matter the architecture of your cloud, whether you use your own equipment or use “as a service” (aaS) hardware and software, you are allowing your precious data to leave the building. For that, you had better have TRUST in your cloud company to keep is safe, secure and backed up!
When do I start?
Moving to the Cloud will save most businesses money over time. You may find the smartest choice is to stage the move into bite sized pieces. Remember, the first goal is to “not break anything”! It’s got to work as good or better than what you are using now. The benefits will vary based on how your company focuses IT resources. You can start to out plan your competition. You can stop spending big CapX dollars on computers and pay as you go while writing that off as everyday operating expenses.
You are still responsible for your data, and you are still responsible for keeping up systems, software and end user support, but now you can decide to keep that in house or outsource all or parts to the Cloud provider.
Check back tomorrow where we discuss the Benefits of Cloud Desktops.