With the modern economy relying heavily on data and digital processes, the need for cloud services has only grown in the past couple of years. Given the need for safe and agile digital methodologies, growth is expected to continue. The global end-user spending on public cloud services is expected to grow to USD 591.8 billion in 2023. Cloud as infrastructure is also witnessing high demand. In addition, the COVID-19 pandemic has shifted businesses worldwide to a digital-first approach, making cloud adoption more important than ever before.
The demand for cloud services is broader than just large and medium-scale businesses, as more small businesses are adopting cloud computing than ever. A 2020 report by Flexera found that 56 percent of small business owners in the US spent around USD 600,000 annually on public cloud expenses. Moreover, as of 2023, about 44 percent of traditional small businesses use cloud infrastructure or hosting services. That’s compared to 66 percent of small tech companies and 74 percent of enterprises.
Cloud adoption for small enterprises
The current business environment is highly dynamic and requires all businesses to remain agile enough to adapt to the rapidly evolving market. They also need to ensure scalability. Data protection and cybersecurity are other concerns. Cloud adoption can help small businesses address all these challenges by empowering them with agility, cost efficiency, remote collaboration, and data security, essential for their survival and growth in today’s challenging business landscape. With comparable technology resources, small enterprises may be able to catch up. But then, keeping up with technology is expensive. As per Ipsos, nine out of 10 small business owners identify the costs of maintaining and upgrading technology as their most significant challenge.
Cloud technology for Industry 4.0
In the digital era, a successful technology transformation is essential. For most enterprises, big or small, digital transformation and cloud technology go hand-in-hand. Cloud technology offers them the agility and flexibility to future-proof their operations. Cloud implementation can enhance the overall efficiency of an enterprise and accelerate time-to-market. Some of its other benefits include:
- Cost optimization: Cloud computing can help small businesses save money on hardware, software, maintenance, and energy costs. Cloud providers offer pay-as-you-go pricing models that allow small businesses to only pay for the resources they use and scale up or down as needed. In addition, most companies experience significant reductions in IT costs after cloud implementation as their systems can be hosted on off-site data centers, offering greater security.
- Business continuity: Cloud adoption mitigates the risk of data loss due to hardware failure or natural disasters. Cloud service providers often have backup processes and systems to ensure business continuity and data recovery. They can also provide software updates and maintenance tasks, thus allowing them to focus on their core business activities.
- Data security: Cloud computing can help small businesses protect their data and systems from cyberattacks, natural disasters, and human errors. Cloud providers offer advanced security features like encryption, firewalls, backup, and recovery. Small businesses can also leverage the cloud to comply with data privacy and security regulations.
- Productivity: Cloud computing can help small businesses improve efficiency and collaboration. Cloud services enable small businesses to access their data and applications anywhere, anytime, and on any device. Combined with analytics tools, the cloud can also improve customer experience through real-time data analysis. It also facilitates remote/hybrid work, team communication, collaboration, and project management.
- Innovation: Cloud computing can help small businesses gain a competitive edge by enabling them to experiment, test, and launch new products and services faster. Cloud services provide small businesses access to cutting-edge technologies like artificial intelligence (AI), machine learning, and data analytics.
With improved productivity, cybersecurity, collaboration, cost efficiency, and better management of resources, cloud technology can help small businesses to scale up faster and more effectively. Meals on Wheels is an excellent example of cloud adoption. This non-profit saved over USD 500,000 after moving its financial management system to the cloud. It also uses the cloud for internal requirements like documentation and customized messaging. Another example of successful cloud adoption is HotelTonight. The company, now owned by Airbnb, leverages the cloud to store data, which helps it to provide the latest information to its users in no time. Using the cloud to store data has also allowed the company to add new services for its audience.
Kicking off a cloud migration journey
Cloud implementation/migration comes with its own set of challenges. It involves transitioning from on-premises infrastructure to the cloud or using the cloud in addition to on-premises infrastructure. Small business owners must outline their whole cloud adoption journey. A checklist follows:
- Assess thoroughly: Evaluate your existing IT infrastructure, business processes, goals, and challenges. Then, identify which cloud service model (infrastructure as a service, platform as a service, or software as a service) best meets your needs.
- Select vendors: You must thoroughly research and compare different cloud providers based on their features, pricing, reliability, security, support, and compatibility. Select one that offers the services and solutions that match your requirements and budget.
- Plan cloud strategy: Plan your data and application migration. You must also decide the migration method (rehosting, refactoring, revising, rebuilding, or replacing) that best suits your processes. Also, consider potential risks like downtime, data loss, and compatibility issues.
- Test after execution: Cloud migration can be executed by a cloud provider or a third-party partner. After execution, test all migrated workloads for functionality and performance before you go live. Ensure your cloud environment is monitored and optimized for cost efficiency and security.
- Adopt best practices: After the migration, you should implement some best practices to ensure efficiency and avoid potential pitfalls. For example, performing timely due diligence, managing access control and security, and training your team members for the transition is as critical as migration.
A well-planned cloud migration strategy will provide a reasonable estimate of time and cost and help foresee any potential risks or hold-ups. Cloud computing can be a powerful tool for small businesses that allows them to scale up and match their tech competency against the more prominent players in their industry. In addition, it can enable them to focus more on innovation. With the right cloud provider and a proper strategy, you can take your business to the next level and succeed in today’s digital economy.