As I visit with owners of small businesses in Indiana I find there is a great confusion on what The Cloud means when it comes to the Internet. Owners want to know what it is and how it might apply to their business.
Can it save them money or is it a waste of dollars they ask. Is it a tool to make their business more efficient or is it one more piece of useless technology to be ignored?
Let me see if I can help.
The Cloud has to do with the management and organization of data for your small business whether that is files, photos, forms of communication or maybe important documents.
Most likely the Cloud is already an important part of your daily operation and you may not realize it. Historically, a business has stored information or data on paper locked in filing cabinets in the corner of your office. Or, possibly, you purchased a computer and stored documents on a hard drive on that desktop computer. You may even have lost that valuable information when your hard drive crashed and you had forgotten to back up the stored documents.
With the evolution of the Internet away from desktop computers and to laptops, tablets and smartphones there has also been a desire to store and access data in almost real time both in and out of the office.
With that desire has come the world of Cloud Computing.
Let’s get a little technical.
How Does Cloud Computing Work for Small Businesses?
Data is kept in large remotely located data centers accessed by a network of servers for specific information or data that has been requested. This data or information is sent back to your laptop, tablet or smartphone for your use. An everyday example of this is your email. Another example might be photos of products offered by your business.
The whole process of data being housed or stored somewhere other than on the hard drive of your computer but easily retrieved is referred to as cloud computing or “the Cloud” for short.
There are many types of software uses that are considered cloud computing. For instance, uses include Gmail, Facebook, Instagram, Pinterest or any other type of social media.
In addition, there are dozens of cloud services referred to as Software as a Service or “SaaS” that are available for your business that can drive efficiency and cost savings.
Here are 6 examples:
1. Salesforce.com (www.salesforce.com): this was one of the first successful cloud services used by businesses for customer relationship management (CRM). This software allows tracking of prospects and all the ways your business communicates with them.
2. Dropbox (www.dropbox.com): this is for storage space for files, photos, legal contracts and any other information that you need to readily access. The beauty of Dropbox is the ability to organize everything into special folders.
3. Quickbooks Online (www.quickbooks.intuits.com): this online accounting software differs from regular Quickbook versions but already is the leader in cloud accounting.
4. Basecamp (www.basecamphq.com): is a simple online cloud based project management software that allows your business and your customer to track to-do lists, share files and photos as well as create internal messages to each other about the project. One great benefit of Basecamp is the ability to track hours used by your employees working on the project.
5. Highrise (www.highrisehq.com): here is an inexpensive way to manage contacts with your prospects including a convenient task system for follow ups.
6. Freshbooks (www.freshbooks.com): create and send invoices to your customers in seconds with your own logo at the top. Save time and make your small business look more professional.
Benefits of Using Cloud Software
1. Helps Cash Flow: one of the major reasons small businesses are using SaaS is that in most cases the software can be paid “as you go” on a monthly flat rate basis. The monthly cost can be in the $30-60/ month range for many packages. This compares to having to invest in hardware or a large software package up front and the staff to support it for a non-cloud service.
2. Flexibility: large complicated software systems that requires up front dollars tends to lock the company into a long term relationship due to the huge initial investment. If the software does not perform as promised the business is locked in or is out a large amount of dollars. With The Cloud if something better comes along, since your business is paying monthly, a transition to another software service can be made usually with few problems.
3. Regular Upgrades: one of the benefits of many cloud software services is the regular updates that the SaaS provider’s staff implements from time to time. Being online the update usually occurs seamlessly. These may be updates as a result of feedback from users or security improvements.
4. Expand or Contract: one of the most important benefits of many SaaS systems is the ability to rapidly upgrade and expand the service if your business takes off. At the same time if your sales slows up you can contract the amount of usage from the service being used in most cases. This will also reduce the monthly cost.
Questions to be Answered About Cloud Computing
1. Security: your data is being stored in a data center located probably far from your office in another state. Most terms of service of cloud software providers indicates that you the client are responsible for any lost data. Either make sure the data you send to the cloud is not confidential proprietary data that cannot afford to be lost or assure that the data is backed up in case of breach or an outage damages the information stored. Ask these questions: Is your data stored on multiple discs? Backed up daily? Backed up in multiple locations? Is all data encrypted even in transit? Are backups encrypted? Are power supplies for servers maintained on redundant systems? Are the data centers monitored on a 24/7/365 basis against unauthorized access of any kind? What is the % uptime which is the % time the system is actually running? This should be greater than 99%.
2. Will the Cloud Provider be There?: how long has the cloud provider been in business? Who owns the company? Is it part of a larger public company? How easy is it to contact the company? Are there phone numbers and addresses or just some email address?
3. What Happens to Your Data When You Cancel? : some cloud providers immediately freeze access to your data upon cancellation of the agreement and eventually eliminates the data. It is important that you read the terms of service and understand what is included as the terms are rarely negotiable. It is best to have a copy of your data that is being stored at the cloud provider prior to cancellation.
4. Intellectual Property Rights: the cloud software provider will be in possession of data and information owned by you and/or your customers. Make sure that the provider does not claim intellectual property rights since the data is in their data centers. In other words, read the terms of service and make sure you and your customers retain all rights to your data.
Cloud computing is the latest Internet tool available for the small business to drive productivity, market share and cash flow. It should free up the owner’s time and capital.
Implemented correctly, Indiana small business is ready for all the benefits The Cloud has to offer.