Consultant Grant Gevers discusses the key reasons behind why businesses need to look to the cloud for digital solutions.
What is driving enterprises to the cloud?
John F Kennedy once said, “Change is the law of life and those who look only to the past or present are certain to miss the future.” This is especially true for business IT, with many businesses that neglect newer technologies often facing internal process inefficiencies and competitive disadvantages.
Cloud computing is one of these technologies. It has gained traction with consumers in the past decade, but businesses are only now beginning to realise the impact adoption can have. But what are the key factors that are driving this realisation?
For SMEs, the drivers often include a need for connectivity, the desire to improve operations and data flexibility.
It’s estimated that in 2020 there will be over five billion internet users, with over half of these accessing the internet through a smartphone or handheld device. The increased connectivity between devices because of platforms like the cloud means that we can bring the three silos of work, home and our social interests into one seamless experience.
Crucially, it also means that staff working out of office are able to remotely update a company’s systems. For example, a sales manager could update a cloud-based enterprise resource planning (ERP) or customer relationship management (CRM) software with new customer or supplier data. This ensures that information is kept up to date so there is a reduced risk of lost data.
Efficiency, or lack thereof, is an extremely common cloud driver for businesses. The Cloud Enterprise Report found that 71 per cent of businesses worldwide had employed the cloud to improve their employee efficiency. In fact, it’s recently been revealed that the government now also uses cloud services for the same reason and is used for tasks such as tax administration.
Improving IT agility and efficiency offers various other benefits including business growth. In 2015, more than half of the enterprises surveyed reported an increased growth since adopting cloud technologies.
This isn’t a complete surprise. The IDC predicts that in 2018, 70 per cent of a business’s total output will be held back because of out-dated business models and legacy technology.
This is because first-generation business applications operate as individual processing systems that do not exchange data or interact with any of the company’s other data systems. In today’s highly connected business world, this type of system prevents businesses from collecting accurate, real-time enterprise information that can be used to improve its operations.
Employing cloud-based software means businesses can provide a fully-hosted, managed service model that migrates all of a business’s critical data and applications to the cloud, which can then be delivered through a desktop session.
By choosing a third party to host key applications such as ERP and CRM systems, businesses can eliminate concerns over data backups and hardware failure and ensure flexibility. Businesses can also scale up and down their software depending on business needs, meaning that cloud-based software provides no technology constraints on growth.
Instead of resisting the shift to the cloud, businesses should look to the right supplier to guide them in choosing the right applications for their business model.