Is There a Cloud in Your Forecast?

What does it cost?
While the traditional model has been to purchase the hardware you need to support the applications and users required to manage your business, the advent of hosted computers has opened up new alternatives. When comparing the overall costs of maintaining owned servers with hosted servers, there are a variety of factors to consider:

• Server Hardware – What does it cost to purchase the hardware vs the cost of providing that same computing power in a hosted server? If you amortize the cost of the server hardware you need to support your requirements over the average 5 year life of a server, how does that compare with the cost of a hosted server over the same time? 
• Server Support & Maintenance – What does it cost to maintain the hardware? Whether you have an IT department on staff, or these services are outsourced, there is a cost associated with maintaining these systems. Typically, the hosting provider takes responsibility for routine operating system updates and any hardware failures as part of their ongoing support. You need to account for the maintenance costs along with the hardware costs.
• Application Software – Software providers are also offering the option of “renting” the software. Instead of purchasing the software outright, you may consider the Software as a Service (SaaS) model. This option allows the up-front cost of the software to be deferred to a monthly or annual installment plan. While the up-front costs are typically lower, you are likely to find that, over time, it would be less costly to purchase the software and only pay for the renewals and upgrades.

Will it enhance employee productivity?
There are several potential time saving advantages to utilizing a hosted application server or SaaS solution.

• The primary advantage of a hosted application server is in the maintenance of the hardware and all the routine operating system updates. To keep a system current and functioning efficiently requires routine maintenance. This service is typically provided by the hosting provider as part of their hosting service. This eliminates the hours spent by your staff on these updates, allowing them to focus on other priorities. 
• Hosting service providers also take responsibility for the necessary hardware upgrades, so you won’t need to worry about purchasing new hardware or managing the hardware upgrades as new technology emerges. For those who don’t have an in-house IT department, this  can be significant. Most hosting vendors offer 24x7x365 support, so you can always reach someone when you need help.
• Keeping your key software applications updated can also be streamlined by having it on a dedicated server platform. By hosting your applications on a shared server, instead of loading and then maintaining software on a variety of individual PCs, only one installation needs to be maintained. This can be a real time saver and it avoids the disruptions required to maintain the individual PCs. 
• Taking it a step further, the advantage of a SaaS option would shift most of the responsibility for these routine updates to the software vendor, further simplifying the whole system.
• Remote Access is another important benefit. Not only will staff be able to access their applications from the office, but field workers or remote staff can also utilize the system anywhere they have a suitable internet connection. With the appropriate security credentials, users are able to log into the hosted server and run their applications, wherever they are. This option can be a significant step to enabling a more flexible workflow for your entire team.

What potential problems should you guard against?
While there are lots of advantages to “cloud computing”, it is not the right fit for every situation. There are some things to watch out for as you consider your options.

• It is dependent on a reliable internet connection, so if you happen to be in an area where internet service is not available or reliable, a hosted solution is not a good idea. For most applications, the internet speed is not a major factor, but users must be able to connect and stay connected while they are accessing the hosted system.
• Data security is always a concern. Be sure that your hosting provider utilizes the appropriate security measures to protect you from hackers. Any reputable hosting supplier will be able to demonstrate their security protocols.
• Data backup is also a critical consideration. Again, reputable hosting providers will also offer disaster recovery backup services as part of their hosting plans. This may be sufficient for some users, but you should also consider keeping a local copy of your critical data. There are lots of ways this can be done, but, depending on the volume of data, there may be additional charges associated with the data transfer.

While this is by no means a comprehensive guide, it should serve to get you thinking about some of the key considerations. Cloud computing isn’t right for every situation, but for most, it is certainly worthy of a close look. There has to be something to it when so many the most successful businesses are promoting and using this technology, but is it right for your organization?

Following are some additional resources:

     Cloud Computing Defined (Wikipedia)
     What is Cloud Computing? (Google Developers)
     10 reasons why Windows Terminal Services is becoming more popular (Tech Republic)