02 Jul Why should SMBs invest on the cloud?

Posted at 15:28h in Minicápsulas by Juanma Roca

Adoption of cloud services is taking a higher percentage, but when it comes to making the leap, Microsoft research shows that SMBs lag behind their business competitors . In fact, 96% of large companies are using the cloud, while only 78% of SMEs are following suit. As you know, the cloud can change the rules of the game for businesses, large and small!

In short, leveraging service-oriented cloud solutions enables small businesses to focus their efforts on the most important aspects of managing their business , and enables technology to be simply one of the many actors who support the company.

We want to show you why it is important and the benefits that small businesses bring after investing in cloud solutions. But before we talk about some concepts to make clear the bases.

It is important to remember that the cloud is not a one-size-fits-all solution. SMBs (small and medium-sized businesses), in particular, need to carefully assess which cloud approach is right to ensure that IT budgets are no longer wasted.

Table of Contents

What is cloud computing or cloud computing?

Since the term “cloud computing” is used repeatedly, and different organizations often use conflicting definitions, it is important to develop a clear and consistent definition, an explanation of the associated concepts.

According to the definition of Wikipedia, multitenant “refers to a software architecture in which a single instance of software runs on a server and serves multiple tenants. Systems designed in such manner are often called shared (in contrast to dedicated or isolated)”

This definition includes two essential elements:

Dynamically scalable and multitenant. One of the central characteristics that differentiates cloud computing from other forms of computing is the idea that computing resources (for example, processing power or storage) can be expanded or reduced according to customer demand. For cloud service providers, this elastic provisioning capability can be affordably provided by pooling resources across multiple clients (i.e., multi-tenancy) to help reduce variability in demand patterns.
Resources provided as a service. Cloud computing abstracts the user’s underlying technologies and operations, providing access to various types of computing resources as services, rather than products. A key feature of this service-based approach to computing resources is the idea that consumers of resources are charged for consumption on a variable, pay-as-you-go basis, similar to the way electricity consumers or gas they pay for their public services. Service models for computing resources may offer infrastructure, platforms or software.

The three service models deserve more attention:

Infrastructure as a service (IaaS). In this service model, the key computing resources provided are computing / processing capabilities, storage, and network infrastructure. Users of IaaS offerings can deploy and run arbitrary software, including operating systems and applications. The user does not manage or control the underlying cloud infrastructure, but has control over the systems running on the infrastructure (for example, operating systems, applications). IaaS examples include Amazon’s EC2 and S3 services, XDrive, and player offerings like Savvis and Rackspace.
Platform as a service (PaaS). In this service model, companies provide computing platforms that allow the design, development, testing or implementation of applications as services for end consumers. PaaS offering users can use specific programming languages or frameworks and tools to deploy applications to the cloud infrastructure. PaaS offerings often act as integration platforms between companies and their suppliers or customers. Examples of such offerings include Microsoft’s Windows Azure and Salesforce.com’s Force.com platform.
Software as a service (SaaS). In this model, software applications are delivered as services. The underlying responsibilities for software installation and maintenance rest with the SaaS provider, not the end user. Numerous SaaS applications have emerged on the market, in particular Salesforce.com customer relationship management (CRM) applications and personal productivity application packages such as Google Docs, Microsoft Office 365 and Zoho.

Any discussion of cloud computing would be incomplete without a description of the various deployment models that can be used to offer cloud-based services. We refer to the two main deployment models as “public cloud” and “private cloud”. While there are some variations that blur the lines, such as “hybrid clouds”, there are a few basic distinctions:

Public cloud. In this deployment model, the cloud infrastructure is available to the general public and owned by a large cloud service provider. A company’s information stored in the public cloud, by definition, resides off-site and would be placed in other information warehouses (for other companies or for individual consumers). Examples of public clouds include Amazon Elastic Compute Cloud (EC2), IBM Blue Cloud, Sun Cloud, Google AppEngine, and Windows Azure Services Platform.
Private cloud. By contrast, private cloud services consist of a cloud infrastructure that works only for a single company or organization. The private cloud provides companies with much of the advantages of the public cloud (such as self-service, scalability and elasticity), but with the control and customization available in dedicated resources through a computing infrastructure hosted in the crazy environment
Hybrid cloud. This deployment model combines public and private clouds, allowing some workloads to be run on public cloud infrastructure, while others are run on private clouds. Although public and private clouds remain different from each other, technology enhances the ability of these clouds to interact with each other.

Why is the cloud important to SMEs?

Market estimates clearly show that SMBs will drive adoption of the public cloud in the coming years, but why? What exactly does cloud computing offer these companies that is so compelling?

The benefits of cloud computing for SMBs can be understood from two perspectives. First, from a capacity point of view, allowing SMEs to gain access to technologies (infrastructure, platforms, and software) that might otherwise need sophisticated computer support to obtain.

For example, few small businesses have the knowledge and experience to continuously manage dedicated servers and storage to run commercially available ERP or CRM packages. By taking advantage of IaaS and SaaS solutions based on public cloud, these companies can stop worrying about the details of installation and execution of infrastructure or sophisticated software packages and simply contract these offerings as services.

Furthermore, by making use of the cloud, SMBs can gain access to service levels (especially regarding reliability and performance) that are much higher than they could provide with a typical on-site installation.

Given this situation, moving to the cloud should be an obvious priority for SMBs, but there are still many myths and misconceptions about the benefits of cloud technology. Next, let’s look at the most crucial and game-changing benefits of SMBs as reported after investing in cloud solutions.

10 Benefits of cloud computing for SMBs

1. Higher profit and ROI

Simply put, companies moving to the cloud earn more money. And neither in a small percentage. Small and midsize companies investing in the cloud report growth of up to 25% in revenue and up to twice as much profit as those that do not. Embracing the cloud is simply a better path to faster growth. Additionally, cloud deployments provide a higher return on investment (ROI) than traditional local software projects, especially in ERP and CRM.

For example, Nucleus Research determined that companies using Microsoft Dynamics 365 see a return of $ 16.97 for every $ 1 spent. That’s well above average for on-premise ERP and CRM applications.

2. Lower costs and CapEx

Cloud subscription models eliminate initial capital expenses (CapEx) like the high cost of hardware and software licenses for projects like ERP software deployments. They also eliminate server, infrastructure installation, upgrade, and maintenance fees, not to mention the resources saved on software upgrades, energy costs, and underutilized computing resources.

3. Unmatched business flexibility

Cloud software enables small businesses to always stay active regardless of location. In the mobile and cloud world, the ability to be productive on any phone, tablet or laptop provides the flexibility to quickly adapt to changing information and business needs. This means more agile operations and happier clients.

4. Faster IT innovation

The hassle and cost of routine IT maintenance tasks can be effectively downloaded to the cloud, allowing IT resources to focus on more strategic tasks like addressing issues, improving user experiences, fostering user adoption and best practices, and more value from systems and processes.

5. Automatic and smooth software updates

Con el cloud computing, todas las actualizaciones de software se manejan automáticamente, por lo que los sistemas críticos siempre tienen las últimas funciones y características de seguridad. Esto garantiza efectivamente que todos los beneficios de las inversiones continuas de I + D de un proveedor se transfieran al negocio de sus clientes, sin que ese negocio tenga que dedicar tiempo o recursos adicionales.

With cloud computing, all software updates are handled automatically, so critical systems always have the latest security features and functions. This effectively ensures that all the benefits of a supplier’s ongoing I&D investments are transferred to their customers’ business, without that business having to spend additional time or resources.

6. Profitable scalability

Your company needs more flexibility to grow and scale without problems. With the cloud, as an SME adds users, generates more transactions, or adds more data, services are dynamically scaled to manage workload. This eliminates the need to pay for more hardware or maintenance to support business growth. As an added benefit, SMBs only use the energy they need for their cloud applications. Since the servers are not idle waiting to be used, operations become more energy efficient, reducing the company’s carbon footprint.

7. Improved collaboration and productivity

Cloud-based digital workspaces offer the opportunity to collaborate more effectively and eliminate data silos to enable greater employee productivity. Plus, cloud-based office productivity suites and all-in-one business management solutions have integration capabilities that simply can’t be matched by on-premises software. Cloud computing also enables teams to be productive, regardless of location. This enables companies to offer flexible work arrangements that create a healthier work / life balance and happier employees without sacrificing productivity.

8. Perfect software integration

Cloud applications are often compatible with application programming interfaces (APIs) that simplify integration, while automation tools like Microsoft Flow make it easy to join without any custom code. Data and systems can be connected like never before, resulting in new levels of speed and efficiency.

9. Superior security and data protection.

Small businesses are the most common victims of security breaches. In a recent ComScore study, more than 40% of small businesses were concerned about data security before moving to the cloud. After making the change, 94% of companies reported security benefits that they had been unable to achieve with their previous local resources.

Furthermore, physical protection of hardware has always been a challenge for SMEs. Laptops are lost or stolen all the time. In addition to replacement costs, there is the even greater cost of losing important or confidential data. However, by storing and backing up data in the cloud, the data is available and protected regardless of what happens to personal devices.

10. Increased competitiveness

Going to the cloud gives SMBs access to business-class technologies that were previously only available to major industry players. With the cloud, any business can operate on exactly the same systems used by the world’s largest and most sophisticated companies, allowing them to innovate and act faster than competitors managing local legacy systems.

In conclusion, the cloud software now available is specially designed for SMEs to execute their sales, marketing, services, accounting, operations, supply chain and project management activities, all from a single solution connected with AI and advanced analysis. . There has never been a better time for SMBs to move to the cloud.

Are you ready for the Cloud?