The Cloud and SMBs: Perfect Together

A cloud management platform is an old concept. Think of the original telephone system. It is a cloud structure: Intelligence is centralized and rudimentary end points – in this case, simple telephone receivers – are at the edge. Thus, the cloud idea actually preceded the distributed model of intelligence. This started with the explosion of PCs in the 1980s. Since they initially weren’t networked, all the intelligence was in the office and the home.

The heightened profile of this old idea during the past few years is due to great increases in processing power and networking speeds that make it possible for more tasks to be performed over greater distances. The macro picture has changed as well, as demand for data continues to explode and the user base grows more mobile.

No category benefits more from the cloudthan small- and medium-sized businesses (SMBs). The benefits are clear on the technical and personnel levels. A cloud provider offers an SMB a shortcut to cutting edge technology, the ability to re-deploy or reduce staff and in other ways upgrade to a more equal standing with enterprises.

Diogo Costa at Tech.co cites cost reduction, increased security and the ability to more easily mobilize employees as the three biggest advantages of cloud for SMBs. Those are three pretty big advantages.

The idea is catching on. Heather Hays at BizTech, in a story highlighting three successful implementations of cloud by SMBs, offered survey results from RightScale: 29.9 percent of those surveyed self-described as “cloud-focused” and another 20 percent reported that they are “cloud explorers.” The fact that half of SMBs – at least in this survey – are using or are open to using the cloud is significant:

After initially taking a wait-and-see approach to cloud computing, many small and medium-sized businesses (SMBs) are adopting cloud-first models for select — if not all — operational components, including collaborative and core applications as well as infrastructure needs, says Laurie McCabe, a co-founder and partner at SMB Research.

Another recent survey – this one by cloud software provider Odin – provides a wealth of information. The top line finding is that SMB cloud service sector will grow at a compound annual growth rate (CAGR) of 11.4 percent. Its value will increase from $25.2 billion this year to $34.9 billion in 2018.

Check out the press release on the survey. It takes a deep dive into the state of the SMB cloud category. The bottom line is that SMBs are using cloud services in a number of ways – and there still is tremendous room for growth.

There is almost no downside to SMB use of the cloud. It cuts costs (or, more accurately, trades a lot of capex for a little bit of opex -- which can be dedicated on an incremental basis), increases functionality and enhances security.

To realize these potential benefits, SMBs must ask both general and specific questions. The high level ones are those that companies ask every vendor: Do you have references? Do you provide services close to the ones you are offering us to other companies? If so,  can we speak to them? If not, why should we be your guinea pigs? What happens if things go wrong? There are many such questions. Organizations are familiar with them all.

There also are cloud-specific questions to ask. Some examples: How is our data protected? What is the level of system redundancy? How do you segregate our data from other companies? How soon after a patch for a vulnerability is released do  you deploy? What does the service-level agreement look like? Is staff available 24/7/365? If not, why?

The bottom line is pretty simple: Cloud computing may not be a fit for all SMBs, but those not using or researching the approach are missing a big opportunity – and one that competitors certainly aren’t passing up.