Cloud Computing Demystified

The concept of cloud computing has a history as far back as the 1960s when Professor John McCarthy suggested that “computer time-sharing technology might lead to a future in which computer power and even specific applications could be sold through the utility business model”. Though a popular concept, it was prohibitively expensive and took four decades to be offered as a mainstream technology. Since then, cloud computing has gained momentum and gives powerful resources to businesses that couldn’t previously afford them. Implementation of cloud computing has the potential to realize savings across the full spectrum of business resources. Use of the cloud can be summarized as the utilization of remote servers accessed via the Internet to store, manage, and process data, rather than using a local server or personal computer.

Sounds simple, right? It is, but there are many aspects of the cloud that need to be considered for businesses to fully realize the benefits. Cloud computing has many inherent advantages particularly for small and medium sized businesses. Why focus on small and medium sized businesses? Because they are organizations that will benefit greatly from the opportunities. However, before getting into benefits, a clearer picture of some core aspects of the cloud will help as a primer to better understand how businesses benefit.

Common Cloud Service Categories

The different types of cloud services have continued to grow as technology and business needs evolve. For simplicity, some of the most common categories are described as follows:

IaaS – Infrastructure-as-a-Service is a virtual environment where servers, storage, networks and operating systems are delivered over the Internet.

PaaS – Platform-as-a-Service is an environment and set of tools to develop, run and manage web applications.

SaaS – Software-as-a-Service is a delivery model in which software is licensed on a subscription basis and is centrally hosted. Applications are typically delivered over the Internet.

XaaS - Everything- or Anything-as-a-Service is the newest term and is meant to cover the ever-increasing range of cloud solutions.

Common Cloud Deployment Models

Public – A Public cloud is available to the public by a provider who hosts the infrastructure. Customers have no control over the infrastructure location and have limited control of configuration or security. Public clouds are hosted by companies like Amazon Web Services (AWS), Microsoft and Google.

Private – A Private cloud is dedicated to a specific company. The business hosts its applications in the cloud with control over data security. It can be hosted internally or externally. Private clouds are more expensive but usually offer more security. They also require a stronger internal IT commitment as the infrastructure is more complex and requires periodic upgrades.

Community - A Community cloud is a multi-tenant architecture that is shared amongst two or more organizations. This model allows organizations with common cloud requirements to work together to drive common business goals, leverage the advantages of public clouds and realize the privacy and security of a private cloud.

Hybrid – A Hybrid cloud is a combination of two or more clouds and gives the flexibility of multiple deployment models. For example, a company uses a public development platform then sends the data to a private cloud to store it.

Benefits of Cloud Computing

There are several reasons why cloud computing is so widely used among businesses today. When implemented correctly, selecting a suitable cloud partner can lead to increased operational efficiencies and perhaps most importantly, allow better focus on core business priorities. Some specific cloud adoption advantages include:

Cost Reduction – A subscription-based cost model is often used for cloud applications. This typically makes it easier for businesses to absorb costs in a predictable manner. In addition, when on-site hosting is removed, savings can be realized due to lower hardware, software, and support costs. Capital Expenses (CapEx) and Operational Expense (OpEx) should be considered when making this shift.
Increased Security – Businesses sometimes delay their move to, or completely choose not to move to the cloud out of fear and uncertainty about the security it provides for data moved off-premises. However, recent statistics show that businesses with on-site data centers have seen a 51% higher rate of breaches when compared to those businesses who have moved their data centers to the cloud. Other observed security benefits are due to routinely up-to-date systems on the cloud, and their utilization of utilities such as spam email management and anti-virus monitoring and remediation.
Flexibility and Scalability – Typically, a choice of applications is available in the cloud which allows flexibility for a business to use and pay for only what is needed. A competent cloud provider will also maintain applications at their most current version as part of their service. Cloud use is typically easy to scale as a business grows. Furthermore, cloud vendors keep their infrastructure updated with newer, more sophisticated hardware to provide for scalability as needed.
Availability – A large percentage of small businesses, 75% based on one survey, indicate improved availability after moving to the cloud. Downtime of services has also been decreased – often due to cloud hosting centers who have on-staff professionals ready at the helm to correct any connectivity or other availability hindering issues. Many contracts include Service Level Agreements (SLA’s) parameters that provide for a quick response time.
Increased Productivity and Accessibility – With remote access to applications via the Internet, employees can work anywhere they have access to an Internet Service Provider (ISP) and enjoy increased collaboration with each other. This can be a key consideration for an increasingly mobile workforce and the growing prevalence of the virtual office.
Disaster Recovery (DR) – All businesses should have a robust DR plan in-place which helps to mitigate loss of data due to unforeseen events. Given that small and medium sized businesses often have limited resources, it can be a challenge to create a proper DR plan. A cloud-based recovery system often provides a feasible alternative.
Cloud Partner Expertise – Cloud vendors maintain infrastructure and security resources with expertise that isn’t always available at comparable levels to small or medium sized businesses. They have a vested interest in maintaining Service Level Agreements (SLA) that typically include criteria such as providing 99.99% availability and encrypted data storage and transmission. Partnering with a cloud vendor may help a business to better focus on their core business.
Opportunity to be “Greener” – According to research, the amount of energy used for an action carried out in the cloud is much less than the amount for that same action with an on-site deployment resulting in a smaller carbon footprint. Cloud vendors can more efficiently leverage infrastructure resources and moreover, many of them are turning to renewable energy. In addition, online collaboration cuts down on the use of paper by removing the need to print documents contributing toward the goal of a paperless office.

Cloud Computing Challenges

Cloud opportunities have great potential for small and medium sized businesses. However, if not approached properly, achieving a smooth implementation can be difficult. Also, missed opportunities will likely occur if thorough analysis and planning does not occur prior to migration or deployment. In a recent Forbes article, some of the biggest challenges experts cited included the following:

Getting It Right – There are many different components and ways to assemble a cloud solution. One expert recommended using a PaaS solution if a more prescriptive method is desired.
People and Processes – When it comes to cloud adoption, the biggest challenge isn’t technology, it’s the people and processes that must change and adapt.
Having a Defined Strategy and Business Objective – Your business strategy and objectives must dictate your cloud approach and not the other way around.
Getting Over the Psychological Barriers – It’s natural to have concerns, especially if cloud adoption is new to your business. Typical worries are related to security, uptime, and technical support.
Time, Cost, and Security – Cloud implementation requires resource investment. This is a common challenge especially for small and medium sized businesses. Understanding and planning will help mitigate these risks.

Cloud technology trends continue to advance and grow. It has become the delivery model of choice for an increasing number of businesses who are able to make use of this technology to their benefit. If you are ready to take a step forward in cloud adoption, Ninestone can augment your organization’s cloud implementation efforts more efficiently and smoothly. Consider the following questions as an initial step when evaluating cloud computing options for your organization.

What type of cloud service and model is best suited to my organization?
This is dependent upon what you need to accomplish. Ninestone recommends an in-depth analysis of how each option ties to your organizational strategies and objectives, the current or future resources alignment and, of course, your budget.
How does a small to medium sized business effectively and efficiently make the leap to cloud computing?
Typically, business users are the initiators of cloud computing requests. Ninestone recommends bringing in IT expertise early as one of the keys to realizing the advantages of the cloud. We can also help to determine how staffing can be realigned to make more significant impacts with little or no additional training to augment skill sets.
What about the control of data?
You need to be prepared in advance to relocate your data if you move away from the cloud or change cloud delivery partners. Ninestone recommends completing thorough due diligence prior to selecting a partner by running through business cases related to future opportunities with each partner under consideration.
How do we know our data is secure?
Ninestone recommends that your cloud partner meets SSAE 16 SOC 2 compliance. This documentation needs to be available to your organization when choosing a vendor. Depending upon your organization you may also have security requirements tied to HIPAA, PCI, Sarbanes-Oxley and/or US-EU Safe Harbor regulation

If you are interested in exploring your cloud computing options, give Ninestone a call to get started.

The Ninestone Team

Updated: April 2018