Growing adoption of cloud computing has facilitated rapid business change over the past decade. For dynamic businesses, cloud offers new ways to scale their growth and better compete with larger, established firms. For businesses of all sizes, cloud is now a mainstream choice and accepted across industries. A recent survey from Cloud Industry Forum (CIF) revealed that the overall cloud adoption rate in the UK is 88%, with 67% of users expecting to increase their adoption of cloud services over the following year.
Small businesses using cloud are growing faster and are often more profitable than those who aren’t. Research by Deloitte revealed that small businesses using an above average number of cloud services grew 26% faster that those who did not and they were 21% more profitable on average. Further research by Exact suggested that small businesses that had made the move to cloud doubled their profits and achieved 25% additional revenue growth compared to their cloudless contemporaries. In fact 85% of those surveyed by Deloitte believed that using cloud services enabled their business to scale and grow faster.
Key benefits of using the cloud are the pay-for-what-you-use model, the potential for productivity improvement, faster time to market and enhanced cyber-security. Going forward, spending on cloud services will continue to grow as it is increasingly seen as a utility and as apps become cloud native, allowing firms to improve efficiency and drive productivity gains.
Below Paul O’Shea, CEO of Kumoco, the management consultancy firm that specialises in agile and cloud consulting, explains the benefits of the cloud for growth businesses and shares some thoughts on the future of cloud adoption and innovation.
Pay for what you use is cost effective
One of the biggest draws for a startup to use cloud is cost. Somebody else runs your stuff so you don’t need to buy the equipment, rent the space to house it or hire staff to manage it. This means that you can focus on adding value to your customers and leave the undifferentiated heavy lifting of running an IT estate to others.
With cloud, you need to pay only for what you use much like a utility bill. So if you have less customers on weekends expect to pay less on weekends. From a software license perspective, you can add users as your team grow, meaning you can make use of powerful enterprise grade software for pennies while your team is still small.
Cloud-based services allow growth businesses with fluctuating or fast-changing demands to scale up or down at a moments notice. This level of operational agility gives businesses a real advantage. The pay-for-what-you-use model allows companies to adapt their technology resources to accommodate big swings in their operational business, quickly and cost-effectively.
Faster time to market
‘Speed wins in the marketplace’ is a truism in today’s fast-paced market environment. To compete in an increasingly digital battlefield and capitalise on new opportunities, companies need to be able to bring new ideas to market at speed. If a project takes months or years to deliver, it can be too late. The flexibility of cloud services can shorten the time between an idea being developed and the product being released. Rather than management having to spend significant time ensuring that there is sufficient capacity and IT resource in place, they can focus on building and launching the new product or service as quickly as possible.
More productive working
All of your team can have access to all of your tools from anywhere, 24/7. This fosters better collaboration and can make you a truly global organisation from day 1 allowing you to stay in touch with your team from anywhere. From video calling, raising invoices to managing your customer relationships all of this can be done from any device or location.
As a startup, you won’t have access to the security resources of large organisations like Google or Microsoft but thanks to cloud you can avail of them. With your software (SaaS), infrastructure(IaaS) or platform (PaaS) security taken care of, you can focus on securing your application.
From a compliance perspective, you’ll find that many of today’s cloud offerings are already fully compliant with a raft of international regulations like GDPR, whose provisions will soon apply.
Additionally, with cloud, business continuity becomes straightforward with a wide variety of options at your fingertips. A small European startup could have their application running across data centres in Ireland and Germany with minimal effort.
Spending on cloud is expected to grow at more than six times the rate of IT spending from 2015 through to 2020 and by 2020, the International Data Corporation, the market intelligence provider, predicts that 60-70% of software services and technology spending will be devoted to cloud.
The world is splitting into software vendors and software consumers. With cost as a key driver all software consumers will eventually move to SaaS products. Only for competitive advantage will it make sense to develop software in house and only those developing will have need for IaaS and PaaS solutions.
Cloud optimisation: with most having already adopted cloud in 2018 there will be a shift of focus from adoption to cost optimisation. As cloud estates become larger managing them from a cost and compliance perspective will only get more complex. To address these needs Kumoco have partnered with ServiceNow to build a Cloud Management product.
With AI as a Service becoming a reality thanks to large investments by IBM, Google, Amazon, Microsoft and Salesforce it won’t be long before we see the general availability of AI capabilities.
Trust: with increasing adoption of SaaS solutions identity and trust will become important topics. How do you manage identity across hundreds or even thousands of cloud services?
With the global cloud services market estimated to be worth £190bn in 2017, according to Gartner, and cloud adoption strategies likely to influence more than 50 % of IT outsourcing deals by 2020, businesses’ adoption of the cloud appears set to accelerate further, helping to drive the development and expansion of growth businesses, which are such a critical part of most countries’ economic success.
Key considerations when evaluating Cloud services:
How much will it cost me as I grow? With most offering ‘free to start’ tiered pricing it’s important to check what the costs will look like one you’ve added all the features you need Is it as easy to get your data out as it is to load it in? What data migration tools are on offer? What if you want to move away later? Does it make sense to have 10 different SaaS products when maybe 3 could meet 70% of your requirements at 30% of the cost? The downside of per user licensing is that the costs can quickly add up if you need multiple SaaS products to get the job done. Do you really need all those features? Probably the basic package will do. Think about the old versions of Microsoft Word how many of the 1000s of features did you actually need or use?
What is the impact of having your data spread across multiple tools? Can they integrate with each other? Will you be able to run analytics on your data? Check that your provider offers well documented APIs and that these meet your integration requirements.
Does your provider meet your compliance requirements? Where will your data be stored? What support can I expect? Check what is offered by your provider but also check for community forums and 3rd party addons / marketplaces.
Skills / professional services: can you easily get help if you need it? Where do I start? Below we have listed some cloud services that we believe are worth a look: