So you’ve heard about “cloud computing,” but you’re not quite sure what it means. Don’t worry; you aren’t alone. Just like a cloud in the sky, the concept of cloud computing can be fuzzy and difficult to grasp.
Imagine this scenario: Right before a big presentation, somebody steals your laptop. Fortunately, you know how important backups are, so you head over to IT. They have a backup of your presentation from 5:00 yesterday, but unfortunately you’re going to have to re-do the edits you made at home last night. So you borrow your friend Tim’s laptop and scramble to re-create your work. But there’s a problem! Your company uses a proprietary database application, and Tim doesn’t have it installed on his computer, so you can’t re-create the data you need. But the show must go on, and you have to give the presentation anyway, even if the numbers are a little off. You arrive at the site just in time and do your best, but the potential client notices your inaccurate statistics and decides to pass on your services.
Now here’s a different scenario for you: Right before a big presentation, somebody steals your laptop. But this time, you know about cloud computing! Your business applications are administered off-site, and all of your data is stored on their secure, backed-up server. You breeze into the conference room, open a web browser window on your borrowed laptop, and your presentation loads flawlessly from the Internet. Success!
What makes cloud computing possible? The number one factor is economic: “Re-branding” software as a service instead of a product. Consider the electric company. They’re not really in the business of selling a product (“Try our new, improved electricity, only 99 cents!”), but rather the service of bringing electricity to your house. The average homeowner could never afford the up-front cost of building power plants, transmission lines, transformers, etc., so the electric company absorbs the infrastructure costs. In exchange, the customers pay a small monthly fee for their consumption. Multiply by millions of customers, and you begin to understand the economics of a large utility company.
It’s possible you already practice cloud computing and you just don’t know it. Do you use a web-based email provider (such as Hotmail, Gmail, AOL, Yahoo!, etc.)? Email was the first, and so far most successful, type of cloud application. Rather than host an email server locally and store emails on your hard drive, you delegate the task to a large company that specializes in this service. Companies can afford to offer free or low-cost email because of “economy of scale.” In other words, the cost per customer is so very, very low that it can be subsidized through advertising, upselling premium services, and other means.
The number of cloud applications, both free and paid, is growing rapidly to include almost any type of software you can imagine. Cloud computing has become an effective business tool. If the applications you need are available “in the cloud,” then your business can save quite a bit of money. You no longer need to worry about expensive hardware and software purchases; the expense can be replaced by a monthly subscription to the cloud applications you need. Why not leave security, backup, bug fixes, etc. to the pros and save some money in the process?
Finally, mention must be made of the impact of cloud computing on customer relationship management. Innovative companies are achieving results (and savings) by outsourcing some or all of their CRM efforts to the cloud. Sales, billing, and technical support are just a few of the areas that can be improved using cloud computing. If you want to succeed in today’s global economy, you need to understand the cloud and what it can do for you.
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