XRBS Blog

Many business owners these days are asking themselves if they should move their whole business to the cloud.  While there is much to like about a web-based “cloud” model – unless your business is small and simplistic, you will want to carefully consider a number of aspects before making your final decision.  Here are some of those critical aspects:

Bandwidth:  If you were to move your business technology entirely to the web, it is imperative that your bandwidth be reliable and of sufficient capacity.  The more interruptions you have, the more your productivity will be impacted.  And don’t be fooled - interruptions are not always a complete outage.  On occasion you could experience network latency for a variety of reasons.  Because different applications rely on different communication protocols – they have different resiliency to network latency.  For example, e-mail and web apps are designed to be very resilient against network latency.  Database type applications, on the other hand, often experience data corruption if network latency is experienced.  If your bandwidth speed is at least 3-6mbs, and has very little latency – you may be “cloud ready”.

Data Size: If your business creates and manages large data files – such as high-resolution pictures or CAD drawings, it is unlikely that moving these files to/from the web as a day to day practice will result in acceptable performance or reliability.  If your business relies on files or attachments several megabytes in size, or any type of design application/files, the cloud will generally not be a good fit for you.  However, if your business only manipulates common file types (Word, Excel, Outlook e-mail, .pdf, .jpg, etc.) - you may be “cloud ready”.

Database Applications: Many business applications store their information in a database repository such as Microsoft Access, Microsoft SQL, MySQL or some propriety database technology.  It is important to know that database applications almost always require direct-attached storage, and cannot run on externally attached storage.  For applications that already run on the web – you have no database concerns because your hosting provider is hosting the database right along with your web application (i.e. Salesforce, QuickBooks, etc.).  If you are currently running an “on premise” business application (meaning it is running on a server located in your business) that has a database component – then the cloud is not going to work without switching to a cloud based version of your software.  If you are considering switching from premise-based software to web-based, be prepared for less functionality.  To accommodate lower bandwidth customers, web based application creators tend to pull all but the most common features from their software to improve performance.  On the other hand, if you do not run any applications that use a database at the core of the application – you may be “cloud-ready”.

Security: Depending on your business, you may need to abide by specific security measures such as HIPAA (medical), Sarb-Ox (publically traded stock companies), or PCI (credit card transactions).  Additionally, data security relies on many factors.  Perhaps the single greatest factor is “who” wants what you have.  Even the most security-minded and capable organizations (i.e. US Dept of Defense and Microsoft) have been breached.  Most SMB’s following common security best practices, do not become the target of malicious security breaches because the resources they protect provide relatively little reward for the effort required obtain the information.  Compare this to larger organizations who can offer significant reward – even when the effort is greater.  For the SMB market, this equation changes when many SMB’s are consolidated into one cloud offering.  Many SMB’s combined start to offer a combined reward that can be worth the effort.  So, unless you obtain and store sensitive data for your organization or your customers, you may be “cloud-ready”.

Cost: If you have made it this far without ruling out the cloud, one of the last considerations will be your business size.  During a few general cost comparisons, I have found the typical inflection point to be between 10-15 users.  When you consider the cost of data storage, user fees, and the other monthly recurring fees, the long term cost of moving to the cloud can be more expensive than purchasing the Hardware/Software needed for your company.  However, if your organization is under 10 users, and you do not have issues with the most common considerations above – then you will find the cloud can provide a significant cost advantage over purchasing, installing, and managing your own technology.

In summary, it is my opinion that there is currently a stampede toward the “cloud”.  The herd mentality states that if everyone around me is running a certain direction – then I had better run that way as well – even if I don’t know exactly why.  Unfortunately I have also found a few business owners that have started moving toward the cloud without considering all of the above aspects, only to find their business in a difficult position.  Like anything, with a bit of proper research and planning you can avoid  an operational and/or financial setback.

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As President and co-founder of Crossroads Business Solutions, Rob Green is responsible for the day to day operations of this central Indiana IT Outsourcing Company. He has a Bachelor’s degree in Business Administration & Management, as well as an MBA in Finance from Butler University. Over his 25 year career, he has obtained a broad array of Sales, Accounting, and Operational experience with businesses of all sizes, from startup to Fortune 500 high-tech corporations.

Crossroads Business Solutions is a central Indiana company providing Professional IT Services including advice, design, implementation, management, and maintenance support to small and medium size businesses that typically have 1 or no IT personnel on staff.  To receive additional technical updates, sign up for our quarterly newsletter here.