Is Cloud Computing Right For Your Company: 3 Key Benefits

The great recession of the late-2000s forced most companies to examine, among other things, how to cut expenses and do more with less. Many firms discovered that these goals could potentially be accomplished by replacing much of their in-house computing infrastructure with services provided by a cloud computing provider.

This analysis also uncovered other benefits of moving to a hosted, IT-services model. Following is a summary of a few of these areas.

I. Cloud Computing Saves Money
(i) Server Infrastructure: When a company builds and maintains their own data center, a server infrastructure must be designed and built to support the business applications.  This involves estimating the number of servers and how much computing capacity is required to support these applications.  Because the capital expenditures are often very high, there is usually a lot riding on the accuracy of these estimates.

Using a cloud hosting solution helps to mitigate this risk by allowing a company to reconfigure their computing resources to meet the demand.  This “pay-as-you-go” approach also enables a company to scale down the available processing power when it is no longer needed.

(ii) Labor: The costs of labor can be greatly reduced using cloud computing. The number of full-time, in-house IT experts needed to maintain the corporate data center can be cut when much, if not all, of the computer equipment is hosted by the cloud vendor and administered by their support staff.

(iii) Leveraging Expertise of Existing Employees: The skills of IT employees can be leveraged in other areas. For example, freed from the ongoing responsibility of operational and maintenance tasks (which can be very time consuming), IT staff can then focus on developing innovative solutions to other company challenges.

II. System Availability and Reliability
Cloud computing hosting vendors must provide reliable IT services or they will soon be out of business. Companies normally negotiate service-level agreements with the hosting vendor to define the availability requirements for their computing resources.

The hosting vendors are legally obligated to fulfill these agreements and because of that, they are highly motivated to provide the resources needed. Technologies such as server virtualization and clustering are commonly implemented to provide highly available systems for their clients.

III. Faster Application Deployment
Businesses are constantly measuring and reacting to ever-changing market forces. The need to quickly deploy new applications and add additional functionality to existing ones requires a computing infrastructure that can rapidly adapt to changing requirements.

Application hosting services offered by cloud computing providers enable companies to deliver the tools employees need to meet business challenges.

In-house software development efforts can also benefit from hosted IT services. When software developers need to prototype a new application, for example, they often don’t have the specific development platform required for the job.  New virtual servers hosted by a cloud computing vendor can quickly be created with the specifications required to support the prototype process.

Deploying new applications should involve thorough quality assurance testing prior to production release.  Maintaining a QA environment to support this type of testing can be a costly and time-consuming effort.

Implementing this environment with a cloud hosting provider allows a business to effectively duplicate their production server configuration for the duration of the test, and then tear it back down when it is no longer needed.

The Profit Formula: Reduce Cost, Increase Revenue
One of the main tenets of business is the need for profitability. This is often achieved by a combination of reducing costs and increasing revenues.

Whether saving money by replacing a corporate data center with a hosted solution, or shortening testing cycles to get products to market sooner, one thing is very clear: companies willing to invest in cloud computing technologies can expect a positive return on their investment.