We are in the middle of a major transition in the world of data storage and computing, from on the floor to in the cloud. A recent Gartner study projects that this is the year of the cloud. Gartner states:“The cloud will change IT as nothing before it has. It may end up removing the last vestiges of the captive IT organization that “owns” its enterprise as surely as the enterprise owns IT. CIOs are right to start addressing it now. They can’t afford to be caught unaware by it, no matter how and when they choose to incorporate the cloud into the enterprise.”

The Cloud Vs. On-Premise Dilemma

For companies entrenched in their current infrastructure, cloud computing can feel like the great unknown. While an on premise server is a tangible asset, the cloud is abstract.  For those who are used to seeing and touching hardware in their server rooms, it’s tough to let go of the tangible nature of the blinking lights. Deciding on cloud vs. on-site computing solutions may seem something of a minefield.

What about security?  So much industry effort is currently being placed on increasing cloud security that the issue will soon be moot.  Once upon a time, not too long ago, people were overly concerned about purchasing items on eCommerce sites.  Before that it was faxing documents over phone lines.   Technology will move forward.

Cloud Computing Makes it Possible to Reduce IT Infrastructure Costs

Key business applications are now available in the cloud.  What does that mean?  It means that the cost to entry for upstart new businesses, businesses that see you as the throne to unseat, will have easier access to the same tools that you have.  It also means that you can have access to tools that your larger and more sophisticated competitors have – at a fraction of the cost.  Because upfront costs are nearly eliminated, replaced with monthly recurring fees, a smaller company can have access to the same software as the big boys without a big budget.  All the functionality and power of a sophisticated system is available for a low monthly cost.

You can still have customizations.  Use them to give yourself an edge.  Stick to a single tenant architecture if you need that flexibility.  In a multi-tenet environment, upgrades and customizations are at someone else’s will.  Good if you are vanilla, not so good if you are rum raisin.

Currently, companies are in a transition mode.   Hybrid models of on-site and cloud solutions are prevalent. Perhaps the ERP system is on-site, but the CRM is in the cloud.  Or the CRM is on-site, but the catalog system is in the cloud.  There are countless possibilities.

The cloud will impact other areas of your business as well.  If capital expenditures for IT go down, that opens up money to be invested in other areas of your business.  Eventually that will spark technology upgrades in machinery, communications, logistics, etc. as vendors look to offer new and improved products for you to redirect your resources towards.   The benefits will be far reaching.