Cloud computing
A business owner wrote to me: “My friend suggested that I use Cloud Computing service for my company but I do not know what it is. I am a business person, not a computer person. I need some simple answer on why do I need Cloud Computing? Please advice.”
Answer: In this information age, every organization is facing challenges to be flexible to response to rapidly changing technology but still deliver quality products and services as required by the business. Unless your organization is in Information Technology (IT) business, you should NOT be bothered with maintaining an IT systems or updating software when there are other important businesses that you need to focus on.
You are the owner of a large company, your goal is to increase revenues, reduce costs, and maximize profits. To achieve that, you apply information technology to automate your processes to increase effectiveness and efficiency of your workers. However, by having an IT system in house, you have to buy software and software licenses for your system and hiring IT workers to maintain it so there is an addition costs. Whenever new software is released, you have to upgrade; every few years you also have to upgrade hardware too. You do not know what to do with the old hardware as some of them are obsolete with no market value. With new software or hardware, your workers need new trainings so you have to spend more to keep their skills current. Your IT workers also need additional trainings to maintain the system, so you have to spend for their trainings too. Sometime after training, they left for better jobs in another company then you have to hire new ones and pay for their trainings again. Every year, you have to buy more software, renew software license, upgrade hardware, provide trainings etc. Suddenly information system has become a significant costs and a major distraction from your main business. As the company owner, you wonder why do you have to spend more on something NOT relate to your business? Why do you have to worry on something that distracts you from running your business?
There is a solution called Cloud Computing and today it is changing the entire computer industry: Instead of having a system in house with hardware and software, you can have your workers access to a Web-based service which maintains all the programs they need to do their job, from e-mail to word processing, from collecting transactions to analyzing data for business intelligence. You do NOT have to worry about hardware or software upgrade; you do NOT have to worry about hiring IT workers or training them. You do NOT have to worry about software license renewal. You do NOT have to worry about buying, maintaining an information systems. Basically instead of “buying” you are “renting” all IT needs from a cloud computing service company.
Today most successful organizations have embraced cloud computing as a comprehensive IT strategy. By renting instead of buying, they focus more on their core business and measure their efficiency, flexibility, and profits rather than spending extra on something that is not their competency. In a cloud computing system, almost everything is handled by the Cloud Computing Service Company. The only thing user needs is to connect their computers to the Internet using simple Web browser and the cloud's network service will handle everything. In the U.S. the biggest Cloud Computing Services Companies are: Amazon; Google, Microsoft, IBM, Dell, VMware etc. Most large companies already moved things to the cloud, including many government offices. The results are excellent with significant cost saving as many companies claimed that they have reduced costs by 20% to 45% with Cloud Computing. As more companies are moving into the cloud, they are also changing the way they use information technology and software is fast becoming a major service.
By the way, I think you already use cloud computing that you may not even aware of. You send me an email asking this question and your email address is a Gmail which means you are using cloud computing already. If you have an e-mail account with Microsoft's Hotmail, or Google's Gmail, then you already use cloud computing service since you access your e-mail account via the Internet as your email is stored on the service computer system (in the cloud) of Google.
Sources
- Blogs of Prof. John Vu, Carnegie Mellon University
