Small Businesses Going to the Cloud: Three Top Considerations
A look at the issues small companies need to make sure they address before jumping into cloud computing.
October 23 , 2012
Small businesses, of course, can save a ton of money and gain a lot of efficiencies by going to the cloud. But getting there isn't necessarily that simple. Fact is, one size does not fit all. " A startup marketing company, for example, may take a very different path from an established medical practice," says Igal Rabinovich, CEO of IT Help Central, a White Plains, NY consulting firm. Here are some key considerations to take into account before making the move.
Create a migration plan.
Best is not to make the change willy-nilly, particularly if you think you'll be moving many applications to the cloud. That means having a roadmap for how you'll proceed, introducing applications one at a time and testing each one before deciding to go ahead with it and then moving onto the next. You also need to include a training period for employees to learn how to use each application.
The length and complexity of your plan, of course, depends on the number of applications you have, the size of your business and how distributed your workforce is, according to Ron Braatz, president of LiftOff Learning, an IT consulting firm. Introducing, say, an e-mail system to a highly distributed workforce would take longer than it would for a company where everyone works in the same office.
A plan can do more than help your move to the cloud go smoothly, however. It can also provide a larger strategic boost. Jill Billhorn, vice president, small business at CDW, a Vernon Hills, Ill., IT consulting firm recalls a fast-growing client, an exercise business that was opening up locations at a rapid pace. At first, the approach was to launch new venues and bring IT staff in on the plan only shortly before opening. "It ended up that IT had to spend much of their time putting out fires as a result," says Billhorn. Eventually, the IT group decided to start scrutinizing the expansion plan for the following year and form a blueprint for introducing appropriate applications. As a result, as the business grew, they were able to operate more judiciously and effectively, and that helped overall expansion, according to Billhorn.
Using a plan also puts you ahead of the pack. Only 35% of small businesses have developed a written strategic roadmap for the adoption of cloud computing, according to a survey, recently conducted by CDW.
Think about reliability .
Whatever you're using the cloud for, chances are it's important to the functioning of your business. So you want to make sure you have access you can rely on. Take Roper DeGarmo, president of Signature Personal Insurance, an insurance brokerage in Mission, Mo., who started using cloud applications eight years ago and now employs everything from e-mail to client data storage systems. According to DeGarmo, who, until recently ran his business from home, his cable connection worked well until later on in the day when more people started using the Internet after returning from work. He ended up adding a DSL connection for Internet access at those times. "Having a fast connection is obviously great, but if the connection has stability problems it can wreak havoc with file uploads and online services," says DeGarmo.
You also need to make sure your service providers have adequate backup precautions. For example, if you're using a phone system, make sure the service automatically will be rerouted to another telephone line if the servers are down. "Always ask the question, what happens if you go down, how will it impact me," says Rabinovich.
Rabinovich, in fact, suggests small businesses think twice before putting certain mission-critical functions in the cloud. " I always ask clients, if the capability is down for a couple of hours or couple of days, what will that mean for your business," he says. " If the answer is, you won't be able to function, you might not move that application to the cloud."
Look at the legal issues.
For starters, scrutinize the fine print. Example: A cloud provider may waive liability in case of lost data. Depending on your industry, you also may need to make sure you're compliant with regulations governing data. If, say, you operate in Europe or have European customers, you'll need to consider the EU's Data Protection Directive, which regulates the processing of personal data, according to Keith Broyles, a partner and specialist in intellectual property at Alston & Bird, a law firm in Atlanta. You also need to be aware of where your data will be hosted. The reason: If it will be on a server outside of the U.S. and there's a problem, depending on your contractual provisions, you could wind up " not getting the benefit of U.S. laws," says Broyles.
Then there's the matter of your exit strategy. " You want to be mindful that there's going to become a point when the relationship between you and your cloud vendor ends," says Todd McClelland, who also is a partner at Alston & Bird. For that reason, you negotiate your exit strategy upfront, rather than dealing with it when you're about to pull the plug.
The upshot: going to the cloud has many benefits. For best success, however, you need to arm yourself with as much information as possible before jumping in.
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