How cloud can truly benefit your company from a cost perspective

By: Neil Biondich, CEO & Co-Founder

Business demands are constantly changing, and most organizations require ubiquitous access to their data; therefore the need for increased scalability, automation, and efficiency make cloud computing a very cost-effective technology.

What started out as a popular buzzword, cloud computing, is now one of the hottest topics in data management today. New dynamic environments which can allocate a multitude of tasks accessed through a network have replaced the static, stand-alone in-house servers and datacenters.

Business organizations have quickly grasped the concepts involved as well as the considerable cost saving potentials of this computing paradigm. Such saving potentials are based on the use of large-scale shared resources divvied up to be allocated to specific tasks and users.

So what are some of the initial and most straight forward cost saving strategies for cloud hosting?

• There are less administrative costs since cloud environments utilize high levels of automation.
• Public clouds, using a third-party vendor such as Red Anvil can deliver large amounts of data and business applications and services at a fraction of traditional costs.
• Operational costs are lower.
• Fewer servers are required because of increased efficiency.

However, these are only the obvious, so let’s explore a few more avenues. The cloud enables convenience on demand, and users have access to the computing resources of networks, servers, storage, applications, and other services. All of these services can be rapidly provisioned and released with minimal effort. The cost savings therefore include the following:

• Cloud computing eliminates capital expenses associated with building a server infrastructure and the upkeep associated with it for security, utilities, insurance, and personnel.
• There is no need to install new hardware as technology and organizational needs change.
• Projects deploy quicker using a self-serve control console.
• As business applications grow, the need for additional storage, RAM and CPU capacity can be scaled up with little effort or additional expense.
• Lower maintenance costs are associated with less hardware, outsourced IT staff, less use of physical resources, and fewer in-house IT experts.
• There is convenient access for disaster recovery to bring up a server in a separate datacenter should there be a primary data outage.
• Security controls are less expensive.

Other financial saving strategies can make cloud computing an exciting and “bean counting” alternative. As internal IT-staff no longer are needed to constantly engage in maintenance activities, these same professionals can transition to the development of new products and services. Personnel will have a chance to test new applications, projects and business opportunities without having to purchase and install more hardware.

The on-demand nature of cloud computing allows businesses to simply pay for what they use. When an organization can power up or dial down at will, the money saving opportunities quickly add up. Companies have the advantage of increasing resources at peak seasons such as Christmas, Mother’s Day, Thanksgiving, etc. or dialing down in August when the largest population in the United States take their vacations.  Companies don’t have to buy more servers to cover the busy times and then just let them sit dormant for the rest of the year.

So how do you know if you should move over to a cloud provider such as Red Anvil? Knowing if it is right for you requires some comparisons. Consider the following:

• How much do you spend for on-premise server and network infrastructure?
• How much is spent on data center utilities which include power and cooling?
• How many IT staff members do you have and how much time do they spend on maintenance?
• How much is spent on security and compliance?

Still need answers?  Attend one of our monthly power lunches where we explore the cloud and how it can benefit your specific needs at your organization.

Also each business has to think about application growth expectations and how demand fluctuates in critical times. Consider the following:

• How many users for the application?
• Does the application have demand spike times?
• Are there seasonal spike times?
• What is the anticipated growth for the application?

There are a lot of cost reductions and advantages to cloud computing, and now small organizations have the same opportunities as giant companies to benefit from IT services and personnel that may have previously been out of their reach. Costs can be easily quantified, making the savings potential easily recognizable.

Want to get your own assessment?  Attend one of our Power Lunches where we provide education on the latest trends in cloud, answer specific questions about how the cloud can benefit your organization and dig into your current infrastructure – all over a nice lunch at our data center in Milwaukee, WI.

Can’t make it to a power lunch?  Feel free to post any comments or questions below and we will answer them in a timely manner.