Wednesday 13 May 2015

How to Achieve Business Flexibility With Cloud Economics

The beginning of internet revolution, so called the Web 2.0 revolution, did not promise anything sophisticated to begin with, but it seemed to just have revolved over time with people realizing the almost limitless possibilities that it can offer. To name one, communication has never been so cheap, fast, and accessible with the internet. The world has gone smaller indeed, and people can get feedback from the other side of the world at an eye's blink. Along with these drivers of change, pressures are lurking around the corners of the walls of businesses and organizations from all industries. Responding to these changes needs to be proactive and not reactive, and the smarter organizations know how to look at the pros and cons of the available technologies for cloud economics that promise the benefits of reliability, security, and flexibility.

We are transitioning from a point where we were just getting used to the power of modern Internet communication, also known as the Web 2.0 revolution, to an age where we will expect an almost instantaneous distribution and assimilation of knowledge. The new age will make it far simpler to communicate with each other, individually and collectively and for organizations to access and utilize important and strategic data. People are beginning to understand the options available to them and to understand how they can access and manipulate data in the "cloud" without having to rely on complex, expensive and difficult to maintain internal systems. As they explore this new world, they want to know how cloud economics can benefit them and whether they should buy into the concept of a cloud economy, or not.

The great recession certainly gave corporate decision-makers cause for concern and made them think even longer and harder about capital purchases than ever before. In many respects, this hastened the arrival of the cloud economy, as cloud computing offers the typical organization many economies of scale. It was not always easy to get access to credit lines in order for companies to be able to purchase additional capitalization on equipment and decision-makers have always considered leasing access to this information and data using the new age cloud computing. As we enter the second decade of the new millennium the lessons learned by the great recession are likely to linger. This is indeed likely to hasten the arrival of the cloud economy, as cash flow issues and limited availability of funds for expansion determine a way forward.

When information technology issues are handled in house, the organization must be sure that it has employees able to operate and handle the hardware and software products needed. The employees must be in a fairly constant state of training to ensure that the organization does not miss out on any important updates, strategically. In-house applications are even very heavy on resource consumption which can unreasonably drain out any organization's resources in no time. As an alternative for some organizations, one option is to choose using the services of an external organization as an integral part of a managed services solution. In this case, the company will need to purchase a set contract with the company, as a managed services company itself must of course meet the demands of its own internal costing structure.

The beauty of cloud computing and the point at which cloud economics really starts to drive the message home is that it is ultimately flexible and scalable. In the old world, a company that envisaged a major project with a huge uptake in server use would have to budget, receive and install capacity ahead of time, with associated capital costs and depreciation issues. Should a company wish to use a managed external service, it should allocate budget for operating costs consequent of that company's pricing. While it would not have to go through the process of budgeting and configuration, it would have to pay direct costs to the management company in place. Cloud economics wins big here, as the cost to access the server capacity as and when needed for the project in question is minuscule by comparison. The company does not have to budget and plan, but simply requests the capacity as and when it is needed.

It's not difficult to imagine how cloud economics can represent a smarter alternative, due to its accessibility, reliability, flexibility and manageability. The client can be much leaner and fitter if it does not have to worry about internal scaling, maintenance, development and training of personnel. Cloud economics can help the organization to become much more nimble and able to take advantage of opportunities as they arise in its marketplace.
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