How the Cloud Provides a Competitive Advantage

In the past five years, the number of companies turning to cloud computing has skyrocketed. In fact, more than 95 percent of respondents in a 2016 RightScale survey indicated their companies had adopted the cloud to protect their data, streamline operations, and save money.

Many businesses are opting to use these third-party vendors to manage their data and applications, giving them more time to innovate and focus on those business operations that require the most attention.

To learn more, check out the infographic below created by Boston University’s Master of Science in Computer Information Systems online program.

Cloud computing

What Is Cloud Computing?

Before understanding cloud computing, it is important to know how data is stored and computer applications are used. Traditionally, businesses and personal computer users store data on local on-site hard drives and enterprise servers. The same storage systems are used to run computer applications. This type of on-site data storage still remains prevalent, but in recent years cloud computing has become widely acknowledged, significantly altering the IT landscape. The word ‘cloud’ here can mean different things in different contexts. Generally, it refers to off-site data storage servers and computing systems. These systems can be accessed from other locations through the network. Technically, even a local IT setup inside a building can be used for a cloud computing environment, but generally it refers to a setup where data is stored in the cloud and accessible from any location.

What Can Be Done with Cloud Computing?

At the basic level, cloud computing can be used to store and access any type of digital data over the network. Applications stored in the cloud can be accessed from anywhere. This offers a wide range of possibilities for businesses. For example, businesses can greatly extend their IT capabilities with cloud solutions. This setup can be used to connect employees, suppliers, sellers, and consumers.

Different Ways Cloud Computing Is Used

Cloud computing solutions can be tailored to match an organization’s data integration strategy. Here are a few ways cloud computing is used to enhance the ability to achieve business goals.

  • Data Storage: Data stored in the cloud can be accessed from anywhere and at any time. This is the most basic use of cloud storage.
  • Software as a Service or ‘SaaS’: This refers to web-based applications involving email, customer relationship management (CRM), business management, time management, web conferencing, and project management, among others. This type of service is offered on a pay- per-use or fixed duration subscription basis.
  • Platform as a Service or ‘PaaS’: Users of this service receive a platform to store both data and applications. It eliminates the need to build and maintain an internal IT infrastructure.
  • Infrastructure as a Service or ‘IaaS’: This is a comprehensive cloud computing solution. Under this model, the third-party cloud computing solution provider hosts hardware, software, servers, and other components needed by a user. The user does not control or manage the physical infrastructure but has complete control over the operating systems, application software, storage, and some network components.

Deployment Models of Cloud Computing

When starting a “cloud” drive for an organization, one must first decide how they wish to store the data. This ultimately depends on how sensitive the data is and whether it should be stored publically, privately, or in some combination of the two.

Public Cloud: In this system, the infrastructure is owned by the service provider, and is accessible to the general public. An organization can purchase the cloud service and allow users access to specific data or the entire system.

Private Cloud: The organization leveraging this service uses the cloud infrastructure strictly for internal use. The infrastructure may be managed by the organization itself or by a third party.

Hybrid Cloud: This is a combination of both private and public cloud elements. Sensitive operations can be run on the private cloud while the consumer- and public-facing parts can be set up over the public cloud.

Benefits of Cloud Computing

Information management has certainly come a long way since hard copy filing. Thanks to cloud computing, here are some of the ways this technology is changing the way organizations conduct business.

  • Reduced IT Infrastructure Cost: This is the most prominent advantage of cloud computing. Even a medium size company that wants to keep its data and applications onsite must install various components of IT infrastructure on its premises. This infrastructure requires maintenance. The owner must then hire trained IT staff to manage, monitor, and run the technologies. Installing, managing, and maintaining such an IT infrastructure can be very expensive. Cloud computing utilizes a “pay only what you use” model which allows users to reduce their IT infrastructure and its associated costs significantly.
  • Access from Anywhere – Data stored in the cloud can be accessed from anywhere, and cloud-hosted applications can be operated from anywhere — this enables access from on-site computers as well various mobile devices.
  • Scalability: When a company buys IT hardware, it cannot discard parts of it that are not used regularly. This problem does not exist with cloud computing. Users can scale the required components up or down and use only what is needed at the time. Essentially, users pay for only what they use.
  • Pay-As-You-Go: A user can buy the service only as long as it is needed. There is no need to pay any deposit or security fee for using the IT infrastructure of the cloud service provider.
  • Latest IT Infrastructure: Users gain access to the most advanced computing systems, storage solutions, and network systems. A company’s internal fixed IT infrastructure can become obsolete over time. The cloud IT infrastructure, however, has no such problem. Both high-end cloud servers and computing solutions are available at very affordable prices.
  • Increased Efficiency and Flexibility: Cloud service helps increase workforce efficiency. Business operations can be streamlined. The efficiency and flexibility of data sharing help improve collaboration among all people associated with the company. They can access data anytime from anywhere.
  • Device Agnosticism: Cloud data can be accessed through any computing device, including PC, laptop, tablet, smartphone and the Internet of Things (IoT) systems.

Drawbacks of Cloud Computing

The leading drawback of cloud computing is that it requires a network connection. Data and applications stored in the cloud cannot be accessed if the network connection is not available. In today’s digital world, this is not a big problem in most locations, but it can be an issue in remote areas where network connectivity is not available or not reliable. Cloud services are accessible mostly over the internet. In most locations, the cost of internet access remains high. Regular use of cloud computing can increase the costs of network access. When utilizing a cloud infrastructure service, the user does not manage or control the underlying cloud physical infrastructure. It remains under the control of local telecommunication companies (telcos), ISPs, and service providers of applications. However, the user does have control over operating systems, storage, and applications.

There are both benefits and challenges to cloud computing. However, most users can agree that the benefits of cloud computing outweigh the drawbacks. Users planning to buy cloud computing services should first compare the available solutions from service providers based on their particular needs. A cloud solution should be judged on the quality of service, level of security, IT infrastructure location, and costs. Most businesses are now moving to the cloud to save money, improve productivity, increase efficiency, and streamline their operations. The increasing popularity of this service means more and more service providers are entering the market. These providers are continually introducing innovative technologies and solutions that will improve the quality of services and expand the cloud market as a whole.

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