What To Expect From The Cloud Phenomenon In 2018

Being able to rapidly see the success that cloud computing has on one’s business is partly responsible for the paradigm shift taking place today. A Forbes survey reported that 74% of tech CFOs said cloud computing would have the most pronounced impact on their businesses in 2017.

Since 2009, cloud computing has grown 4.5 times faster than IT itself. And that rate is only accelerating. The same study shows that by 2020, the growth will be up to 6 times as fast as IT. In 2017 alone, the demand for cloud computing is growing to $246.8 billion from $209.2 billion, an increase of 18%. In the same calendar year, the demand for Software as a Service (SaaS) is shown to be on the rise by 20% to $46.3 billion. Even more impressive is the projected growth that shows that by 2020, 60%-70% of all software, services and technology spending will be cloud-based.

How companies are benefiting
It’s obvious that companies large and small are rapidly jumping on board the Cloud Computing Express, but why is the rush so frantic and absolute? Quite simply because cloud computing is doing the things that make chief financial officers (CFOs) salivate when it comes to expenses versus revenue.

In a recent issue of Supply Chain Digest, polled executives said the best things about the cloud were:

Faster deployments. Getting things through the pipeline quickly means lower labor costs, greater efficiency, and perhaps most importantly, greater customer satisfaction.

Faster time to value. Time to value (TtV) refers to the period of time between the request for a business goal and the delivery of that goal.

Ease of upgrade. Perhaps the biggest selling point of the cloud is the idea that when it’s time to upgrade software, there’s no need to suspend operations or spend exorbitant amounts of money on new software licenses. Everything is routed through the cloud.

Total cost of ownership. This is congruent with ease of upgrade in how much specific components of your business practice have added costs over time. For instance, a computer software program you bought in 2010 has upgraded five times since and you’ve had to buy 10 additional licenses for it as your business has grown. Those costs are minimized or non-existent in the cloud computing environment.

Any one of those four characteristics would be enough to send CFOs and CTOs flocking to a technology. Capture all four positives in one fell swoop? They call that an industry disruptor. And it’s not just the visionary view of cloud computing that has executives so excited. Supply Chain Digest also revealed that of supply chain users currently operating in the cloud, 93.5% gave a rating of “Satisfied” or better.

“Find a cloud-based technology that enables faster deployments, faster time to value, ease of upgrade and lower total cost of ownership and you’ve got a disruptor.”

Big growth, big worries
No matter how successful a new technology is, there will be massive growing pains involved. Demand outpaces supply, leading to cheaper market players who will compromise quality for more customers at a lower overhead. That can be a scary proposition considering the nature of the industry. Not surprisingly, the top challenges for companies seeking to enter the cloud computing market are expertise, security and cost.

Expertise is the silent killer of the three, because it is the most difficult to address. The biggest problem is that there is not a lot of uniformity among cloud vendors, so being well-versed in one doesn’t mean an employee can make heads or tails of another. This can be a stumbling block in getting started and then again when you wish to move from one provider to the next.

However, security is the most publicly known worry about the cloud. Every time a data breach occurs, the reputation of cloud computing takes a hit, regardless of whether or not the server hacked was in the cloud, without even mentioning all the incidences where a user error exposes a system weakness that leads to hackers finding a way into a database.

Cost can be a burden, particularly if you don’t have expertise as part of your standing knowledge base. CFOs relate those guilty moments when they check the dashboard of their cloud computing service and realize they’re being charged per minute or per hour for data they haven’t used in weeks. Using a service with a dedicated dashboard and committing a role in your company specifically to ensure that what you are spending is in line with what was budgeted would help streamline costs and keep them within budget.

Cloud computing has become a tidal wave flooding the business world with the promise of a faster, more secure and smarter tomorrow. Due diligence will be your best resource in finding out when and where to enter the market and how to optimize cloud computing for your company’s success.

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Marty Puranik

Marty is the founder, president, and CEO of Atlantic.Net, a profitable and growing hosting solutions provider in Orlando. Marty’s strengths as a leader and visionary have helped him lead a successful business for over two decades. Atlantic.Net thrives thanks to Marty’s strategic acumen, technical prowess, and his valuable, old-fashioned habits of thrift, modesty, and discipline.