The SMBs guide to the cloud

Man sitting on a cloud, celebrating

For many businesses, the benefits of cloud computing have made it a no-brainer. The cost savings of its ‘pay-per-use’ model, the elimination of capital investment and the cloud’s ability to scale on-demand make it the most economically desirable computing infrastructure on the market.

But a significant number of businesses, however, have been put off by two important concerns. The first is security. Businesses haven’t liked the fact that, despite promised precautions, their data will reside on shared infrastructures and will be internet-exposed.

The second is prior investment. In switching to the cloud, many businesses have been asked to write-off thousands of dollars worth of on-site spending on hardware infrastructure and software licenses – something that just hasn’t made good business sense.

The result has been what I call the ‘cloud chasm’: a stark gap between the early adopters who’ve brushed aside these concerns, and the majority of businesses who’ve been held back. The good news is that new types of cloud computing have recently emerged that deliver economic savings and scalability on-demand without compromising security and making prior investments redundant.

To understand how, we have to look at how the cloud has been implemented to date.

The cloud spotter’s guide

Cloud computing has three variants.

  1. Public cloud is cloud computing in its traditional form. The cloud services your business uses are hosted externally on a shared infrastructure of virtual machines, managed by a third-party cloud provider.
  1. Private cloud is a manifestation in which your cloud services are hosted internally on an infrastructure of virtual machines, managed either by your own staff or with a vendor’s help.
  1. Hybrid cloud is a mix of both public and private cloud services. You might choose to host your CRM externally (using SalesForce.com for example) while hosting your email and documents in-house.

Choosing the right model for your business means juggling various demands. Your staff simply want freedom, flexibility, familiarity, reliability and control – the ability to work efficiently from anywhere and on any device. Your IT team, however, is looking for a solution that’s secure, manageable and low risk. They want someone reliable in charge of up-time, backups and system upgrades. Finally, from a financial perspective, your business needs a solution that offers value for money and predictable costs.

The problem with the public cloud

Boiled down, the big trouble with traditional public cloud implementations, often referred to as Infrastructure-as-a-Service (IaaS), is data – more specifically where it’s stored. For both security and compliance reasons, businesses have said, “Hang on, I can’t afford to have my data to reside on a shared, internet-accessible platform that’s outside my control.”

While many cloud providers have urged these businesses to worry less about this important fact, recent events such as the hacking of Sony’s PlayStation Network (a hack in which the details of 70 million customers were stolen), have only underscored these concerns.

The other big problem with the public cloud is its inherent reliance on internet connectivity. Consider how often your internet has failed. Now apply that to your whole business. The fact that public cloud services has meant a shift from local network (LAN) connectivity to a wide area network (WAN) has created multiple points of potential failure.

Private Cloud-as-a-Service

In response to the dilemmas of the public cloud, many cloud vendors are now focusing on private cloud solutions. While the idea of the private cloud is not new, recent technological developments and partnerships are now making it a much more cost-effective solution.

The private model is essentially this: rather than subscribe to a third-party cloud service, your business instead becomes the weather-maker – building your own cloud and hosting it on site. This allows you to keep control of your data. It’s not overseas and it’s not ‘somewhere’. It’s wherever you need it to be; on your premises or in your data centre.

The virtual servers, systems and software behind the cloud infrastructure are still managed by your cloud provider, but the solution is remotely managed, rather than remotely hosted.

For business owners, the big plus is security. You’re able to keep everything behind your network firewall (just as you do now) taking to the cloud while maintaining your compliance with any data protection requirements your business is subject to.

The other advantage is that – unlike in the public cloud – you can continue to make full use your existing infrastructure investment. Your computing and network hardware can be deployed as part of the private cloud solution for example. Or, if you happen to be re-examining your requirements in light of the Queensland floods, your business can redeploy it off-site as a disaster recovery platform.

Under the private cloud, you can also continue to use the software licenses your business already owns, while making the switch to a swiftly scalable, operational expenditure funded cloud, paid for monthly on a usage basis.

As long as it’s delivered ‘as-a-service’ you don’t lose the support and monitoring you’d get from a public cloud solution. Compared to sticking with your own traditional infrastructure, you can expect cost savings of around 32 percent over three years.

Which cloud is right for me?

Three simple questions can help you to decide which type of cloud best suits your business:

1. What’s your aim? Why do you want to take your business to the cloud? Is it to save costs, boost performance, increase flexibility, or all three?

2. Do you care about your data? How important is data security and control for your business? Do you need to control where it’s stored, including backup copies?

3. Do you have prior investments you don’t want to lose? Do you have capital expenditure tied up in hardware and licenses, or are you prepared to start afresh?

If you are willing to risk putting your data in a shared environment and to write-off your current IT platform (something that’s easier if it’s reached its end-of-life), then there’s no reason that your needs can’t be met by a public cloud solution.

But if data security, compliance or existing investments are a concern, then you’d do better to consider a private cloud solution delivered as a managed service.

Doing it right

Whichever model you choose, the next hurdle is implementation. From specialist providers to major service providers such as Optus and Telstra, there’s currently a proliferation of cloud services on the market, some of which you can switch on in less time than it takes to read this article.

The key to doing it properly, however, is to fully understand your requirements. The most common complaint when businesses switch to the cloud is that their systems ‘don’t perform as they used to’. Almost without exception, this stems from an underestimation of the demand for bandwidth or processing power.

While there are many players out there, it pays to remember that the cloud is still an expert game. To maximise its business benefits, partner with an expert who’s prepared to work hard to develop a deep understanding of your business and its demands.

–Nick McMenemy is a cloud specialist with Thomas Duryea Consulting.