By now regular readers will know that I am a big fan of Cloud Computing. Although a relatively new buzzword, the underlying technology behind it has been around for well over a decade, which is eons in “Internet years.” If you have gmail, yahoo mail or hotmail, chances are, you’ve already experienced Cloud Computing.

But what is the ‘Cloud’ really? The cloud is just an analogy for running services and software over the internet. Technically, cloud computing involves storing and accessing of data, or running of a program or application over a network instead of on a local a computer hard drive. In fact, the term ‘cloud’ comes from old network and engineers diagrams dating back to the 70’s, when mainframes ruled. The cloud symbol was used to represent a network connection between two or more data centers.  Hence, data and applications from remote locations were ‘in the cloud’. Oh we geeks are an imaginative lot.

Today, cloud computing can be best thought of as the ability to run programs and store data in ‘in the internet’ instead of on your local device. The cloud means that you don’t have to install different programs for individual computers. It also means that files and data from your own computer can be stored on a remote computer or “cloud storage provider” over the internet, and accessed from any device.

What does the cloud it mean for your business?

There are many benefits to having all your programs and data available in the cloud…  and device and a few notable drawbacks.  First, let’s look at the benefits.

1.       You don’t have to worry about IT requirements:  there’s no need for a dedicated in-house IT staff, everything is automated, and you can allocate your limited staff to more business oriented functions, rather than worrying about keeping computers running.

2.       Applications are automatically updated: cloud software vendors will update the software you use automatically. So no more complex installations once every year or so. This also means your staff get to take advantage of new capabilities immediately.  Of course, this also means that your staff will be frequently seeing changes in the software they use. Normally, this would require extra training, which is downtime for small businesses. However, most cloud software vendors release only small, incremental changed, so that people get just a little bit of new functionality to learn every so often. This means that training and improvement is gradual and consistent. A much better idea that the ‘big bang’ approach to software upgrades.

3.       You don’t have to worry about overwhelming your hard disk:  cloud storage providers not only give you extra disk space, but also help you manage data effectively. Most cloud storage services will do all sorts of fancy things behind the scenes, such as de-duplicating files, performing backups, replacing failing drives (without damaging files), etc.

4.       You can access your files anytime, anywhere and capitalize on collaborative work: since the data is available in the cloud, collaborators can access and contribute to a task from anywhere and at any time. They don’t have to physically access the computers at the office.

5.       You can reduce costs by saving up on power requirements, data storage, space (reduced hardware), and do away with software updates, maintenance and repair costs.

However, cloud computing does have a few drawbacks:

1.       Working with the cloud means you need a decent internet connection:  For many small businesses, a standard ADSL 2+ connections are good enough for 3-5 computers. Just. Using only basic cloud service.  However, the more cloud services you use, and the bigger the files and more computer you add to the business, the more bandwidth you will need. In some locations – often those where nurseries are located – it is simply not possible to get more bandwidth. In this situations, cloud services will need to be limited.

2.       Cloud services require an ‘always on’ network:  If your network connection goes down, you lose access to your business applications and data. However, this is not nearly as big a problem you might imagine. As a backup plan for if (or when_ your fixed line internet connection goes down, you can purchase a “4G wireless” network hub.  Should the fixed line internet connection fail, you can simply power up the wireless device and you’ll be back in business.  Such devices are cheap: Telstra as a unit that costs about $100, and you can get a year-long data contract for $180 which will see you right for any network failure emergencies. This approach to having a backup network is really solid – I know of emergency services and large enterprises that use this very trick for their remote sites. It’s cheap, and it works!

3.       Cloud needs trust: Moving to the cloud means that you put some faith in your various cloud providers’ ability to secure and protect your business’ information.  A better way of thinking about this is, to ask yourself: who has more experience in keeping computers running and data safe, my local IT guy or a mega-corporation which does this for 500 million people?  And unless you keep highly sensitive information that you do not want American Intelligence Agencies to be able to access, it’s a good bet a cloud vendor’s security will be better than anything you can build yourself.

4.       Changes how you buy computing:  In the past, we would buy software outright and use it for years, but most cloud services require a monthly or annual subscriptions.  This changes the way in which you not only buy technology, but how you account for it. Computing becomes a business expense, rather than an asset to be depreciated. In some situations, cloud solutions appear to be more expensive than keeping the technology in your office. In other situations, cloud solutions are much, much cheaper.  Its swings and round abouts.

Business Scenarios

Let’s take a look at some scenarios for you to consider:

All on the same page: Most of the time, we collaborate with someone else while working on a project. For example, working on a landscape design or writing up promotions.  There are cloud solutions, such as Google Apps and Microsoft Office365, which allow people to all work on the same document at the same time. There are also cloud solutions which automatically synchronize documents – such as drawings and photos – between different people’s devices.  These simple solutions make a HUGE difference in the speed at which work can get done.

Natural disasters: Floods or other natural disasters will wipe out computers and also valuable financial records and customer data along with their back-ups if these were kept nearby. We saw this during the Queensland floods. Cloud computing means your data (and backups) are situated a long, long way from where your computers are.  Since most cloud service providers are located in different countries and have all data backed up in different states, there is almost no possibility of files you store with them being lost due to a disaster, short of global thermal nuclear war.

Spring Clean your Business: Some of your files might be outdated and no longer relevant but you keep them anyway. They take up space and make it hard for staff to locate important client files.  Some people mistakenly believe that moving these old files to a backup external hard drive is viable long-term solution. It’s not. Hard drives – especially those useful external hard drives – have a limited lifespan of just a few years.  To really protect your old data, you would need to continually (well, annually at least) copy the old data to multiple drives and check that the copies were successful.

The alternative is to take all of these old files and place them on a cloud-based storage services. This means that the data is readily available when you need it. Better still, the cloud storage vendors are masters of continually checking their storage and moving data around so that it is never vulnerable to hardware failure.

On the road: Opportunities to network and promote your business come up in unusual places: at a party, playing golf, standing in line at a local coffee shop.  Cloud services enable you to have this information readily available on your smartphone or tablet.  Having your files available on the cloud means that you don’t have to wait until you are back in the office to get information to hot prospects. You can share downloadable files such as flyers, brochures, catalogs, order forms, and other pertinent information to potential customers. If you have a team of staff that collaborate, the ability to share files between themselves and update them in real time is a very valuable feature.

In short, you should be looking at cloud solutions for your business. Take the lead from the above examples scenarios, a good place to start is to look for a “cloud storage solution”.  At the very least, putting your important files onto a cloud storage service will mean your data is far more safe than it currently is.  At best, it will change the way you do business.