IT vendors sometimes make statements that result in head nods, even though not everyone is exactly sure what it all means. One example is remarks along the lines of, “Move to the cloud and get more competitive…” Yes! What? Cloud computing technology can indeed help your business stay competitive. It’s not a guarantee, though. In some cases, staying away from the cloud is your best shot at being a competitive business in your field. Done right, however, the cloud can be a powerful force for competitive advantage.
What Drives Competitiveness?
Many factors contribute to competitiveness. Innovation products and services, great people, amazing marketing—these are all legitimate factors that confer competitive strength. From a cloud perspective, the most relevant drivers of competitiveness include keeping costs down and maintaining agility in both operations and strategy.
How Cloud Technology Works, Briefly
The cloud is, as its name suggests, a somewhat abstract concept. Broadly, the term refers to operating virtual versions of digital assets like computer servers, databases, networks and storage arrays in large, remote data centers. Those assets are owned by a third party, a cloud provider, who rents them to you, usually on a “time used” basis.
Thus, you could rent a Windows Server from Amazon Web Services (AWS) for an hour and spend a dollar or so for the privilege. The advantage of that arrangement comes from avoiding the costs of buying that server for thousands of dollars, building a data center to host it in, setting it up, maintaining, connecting it to the network and so forth. Cloud computing services come in a couple of standard flavors, with the big three comprising:
- Software-as-a-Service (SaaS) – where you get access to a fully-functioning piece of software that’s hosted by a third party in the cloud, e.g. Salesforce.com
- Platform-as-a-Service (PaaS) – where you rent a preset platform like Windows Server, ready-to-go, in the cloud. (You have to install your own software on it to derive any benefits.)
- Infrastructure -as-a-Service (IaaS) – where you can assemble virtually any IT solution you can imagine by renting separate components as needed, e.g. servers, storage and networking
There are many other “as-a-Services,” including database-as-a-service (DBaaS), Disaster Recovery (DRaaS) and so forth. Plus, in many cases, your needs will put you into what’s known as a “hybrid cloud,” where you connect your existing, on-premises systems with the cloud, e.g. for storage or backup.
How the Cloud Helps You Stay Competitive
The secret for cloud-based competitiveness is two-fold. On one level, pretty much any time you switch from using an IT solution hosted in your own data center to using it “as-a-Service” from a cloud provider, you’re going to save money. You’ll save on capital expense (CapEx), data center overhead and support personnel. In some cases, a cost-benefit analysis will reveal this not to be the case, but generally, switching to the cloud lowers your costs of business operations. This, in turn, enables you to stay competitive, pricewise in the marketplace. You’ll also liberate cash from IT CapEx for use in R&D, marketing and more.
The other secret involves the cloud’s ability to make you more agile. Generally speaking, you can move faster in the cloud than you can on-premises. Imagine that your marketing department wants a new data analytics solution to help assess the effectiveness of recent campaigns. With the cloud, that solution could be up and running literally in a few hours versus weeks or months for its on-premises equivalent.
Agility in operations translates into strategic agility. When you move quickly, you can quickly capitalize on changes in the market. For example, if your competitor announces an improvement in customer service, you can best that move by spinning up a new, better Customer Relationship management (CRM) system in the cloud.
Implementing Cloud Technology for Competitiveness
While cloud providers promote themselves as self-service, the best practice is often to work with a trusted advisor in a cloud rollout. This is one of our service offerings. We can help you understand the cloud’s competitive potential for your business. From there, we work with you to design and implement a cloud strategy.