What is Cloud Computing?
Many companies have provided remote access to vital enterprise applications for years. But the speed and popularity of the current shift of enterprise solutions towards remote connectivity with cloud computing is different. It is about leveraging remote access technologies to cut costs and risks associated with enterprise IT, while continuing to drive value and innovation. In many cases, this means storing and processing information on several computers throughout the country, or even the world.
You may already know that cloud computing is commonly known as a way to avoid large capital expenditures while gaining greater control over enterprise solution scalability. And you may know that CFOs all over the globe are attempting to save money with an IT model built on purchasing quality services, rather than the extensive hardware and talent needed to maintain quality enterprise talent and hardware. What you may not know is exactly what those savings look like, and how you can be sure you are leveraging them to continue driving innovation and value in your company.
Maximize the 3 Benefits of Cloud Computing
For CFOs, there are benefits to the cloud computing model.
- Faster establishment of enterprise solutions
- Reduced establishment costs
- Improved scalability
Speed up Service Establishment
The struggle for CFOs working under a traditional model is to keep development and deployment of innovative, value-enhancing enterprise solutions on track and on budget. In the past, establishment of enterprise solutions could take weeks, even months. With a cloud computing model, even an entirely new service can be up and running in hours.
It is exactly this functionality that led Gartner to suggest the use of SaaS in a recent report. The authors concluded that CFOs looking to drive value and innovation in IT in a short period of time “should evaluate alternative sourcing models for delivering functionality for advisors and clients with greater speed.”
Reduce Initial Expenses
Under the old IT model, companies have to buy all the hardware, software, and human labor to support the entirety of their enterprise solutions. This includes:
- Network servers and other infrastructure
- Data storage
- Information processing
- Maintenance experts
- Employee training to ensure proper use
Of course, every company has to purchase the infrastructure to support their enterprise solutions internally. But the report mentioned above also suggests that SaaS is an excellent option for CFOs looking to build value with limited capital or labor resources to commit to these IT necessities. The fact is that cloud computing drastically shrinks this barrier, by shifting much of the infrastructure elsewhere.
With a cloud computing model, most of the solution storage and processing hardware is owned and operated by the SaaS provider. This means that the subscriber company avoids hardware costs, as well as talent and labor costs required to support that hardware. Using a SaaS model also reduces the time expenditure needed to develop internal standards and procedures for the new IT service. So, instead of paying out for huge banks of costly computer equipment, along with additional procedures and talent, CFOs utilize and modify existing connectivity, which is a much smaller capital expense.
Refine Solution Scales
SaaS solutions can be adjusted to the current business reality, whatever it may be. If a company is experiencing growth, or expects a periodic elevation in regular cycle (such as Christmas time for a large chain of retail stores), services can be quickly scaled up to meet those needs. Once that periodic elevation is gone, or if a company experiences a general slump in business, those same services can be scaled down.
It is in downward scaling that SaaS shows the greatest ROI. Decreasing or eliminating a service is a simple matter of adjusting the monthly contract, at a reduced cost. There is little or no hardware and talent to distribute, so CFOs spend less time mitigating the cost of decreasing the service, and more time looking for ways to increase value across company holdings.
What does a quality SaaS contract look like?
- Reliable - A guaranteed uptime of 99.5% is vital, with a complete set of contingency plans for failures.
- Secure - With committed experts, cloud computing solutions are typically more secure than in-house solutions from small to mid-sized companies. Real-time access to data means companies can meet or exceed regulatory compliance.
- Compatible - Make sure that the cloud computing solution can interact with in-house enterprise solutions.
- Cost-effective - Select from a billing model that works for your company. Most SaaS providers operate under monthly fees, or standard usage charges. Avoid companies that want you to lock in for long periods of time.
Conclusion
While it may not make sense for a company to apply a cloud computing model to every enterprise service, smart CFOs are seriously examining the trend for some of their services. The new model delivers significant savings and increased fluidity to a department that is deeply affected by the current economy. The big question now isn’t whether to adopt cloud computing, but rather, where and when to adopt it.
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For more information, please contact Infocrossing at 866.779.4369.
