When our grandparents and parents set up their businesses, they relied on pieces of paper and stored the increasingly heavy weight in filing cabinets. This had the virtue of certainty. As long as people were disciplined in labeling each file, everything was easy to find. But, if there was a fire, it was equally easy to lose everything whether to the flames or the water when the fire department used their high-powered hoses. Then along came computers and there were problems as entire blocks of data could just disappear.
The paranoid tried to run paper and computer systems side by side and lost all the economic advantages of going digital. Now there’s a new kid on the block. It’s called cloud computing. You could already have your head in the cloud if you run a Gmail account — all your mail and messages are stored by Google.
This trend has been building for the last ten years as more businesses began to outsource some or all their IT problems to bulk suppliers (often overseas). But, in the first instance, this tended to be major processing tasks like the payroll. The difference in today’s services is that you can run applications online and in real time on hardware supplied by an independent company. Indeed, it’s not even necessary to know where the hardware is located. There can be a single site or multiple locations depending on the scale of your business and the nature of the applications you want to run. The advantage of this approach is that the applications are almost infinitely scaleable. What starts off small today, can be massive tomorrow without you managing the upgrade.
Ah, the costs. . . If you run your own hardware, you are responsible for every aspect of its maintenance and support. It’s your responsibility to design and develop the software. This can mean major up-front costs when you buy the systems and serious money required for maintenance and support. Moving into the cloud gives you services for a monthly fee. There are already packages for almost all the major business functions available. In the main, these match or exceed the capabilities of the free-standing packages you can buy. Obviously, a tailor-made solution, specifically written for your company will be hard to beat. But when you consider the cost of the bespoke project, it may be more cost-effective to accept fewer individual design preferences in the generic product. The choice all comes down to whether your needs are complex and cannot be met by the cloud applications.
If you decide you are going to move to the cloud, the first step is to discuss your security and archiving needs with the supplier. You must be satisfied the service supplier will meet your local law requirements on storing and processing sensitive data. Once the decision is taken to move, call your business insurances company. This is a major change in the risk profile. Instead of having your own hardware and data vulnerable to fire, earthquake and other natural disasters, you are now relying on the security provided by the supplier. If this supplier is reputable with proven hardware and software, you are likely to pay less for moving online. Discuss this with your business insurance agent before confirming the move or disposing of your hardware.