Don’t understand cloud computing? You’re not alone!

Introduction

I come across a lot of interesting surveys, but the Citrix Cloud Survey, conducted by Wakefield Research, is by far my favorite for this month! And my favorite finding from the survey?

“51% said they believe stormy weather interferes with cloud computing!”

I love this because it perfectly demonstrates how confused people are about “the cloud”. People in the technology field often take for granted that everyone knows what we mean when we say our solutions are “cloud-based”. We do it at HighRadius when we say our Receivables OnDemand solutions are “cloud-based”. We even go as far as to assume that people understand all the benefits that are inherent with the cloud just by hearing that word. Well, you know what they say if you ASSUME!

From the survey: Only 16% said (correctly) the cloud is a computer network to store, access, and share data from Internet-connected devices.

Cloud solutions have been truly revolutionizing, for both consumers and companies. You probably use a cloud solution, or several, every day – online banking, travel sites like Expedia, photo storage sites like Shutterfly – and you love them! Why do you love them? Because they make your life easier, they are low cost or free, and they aren’t hard to set up or use. The same applies to enterprise cloud solutions that are used by companies. Gone are the days when using technology for efficiency gains were reserved for companies with large IT teams and lots of resources to throw at a project. For those companies without the IT infrastructure to consolidate on an ERP platform or buy a best-of-breed point solution that is “on-premise”, cloud computing offers the opportunity to make the same business improvements as the big guys.

Benefits of the Cloud for Companies (with definitions for the jargon):

• Lower Total Cost of Ownership (TCO): TCO is marketing-speak for the investment that a software project is going to require over its lifespan. Cloud computing projects cost a lot less than traditional “on-premise” software projects because there are no servers to buy or maintain, implementations and integrations are less complex and require little or no internal IT involvement, and upgrades are pushed out automatically with little impact.
• On-premise software: More jargon you’re likely to hear. Wikipedia’s definition is quite good (see below).
• On-premise software is installed and run on computers on the premises of the person or organization using the software, rather than at a remote facility, such as at a server farm or cloud somewhere on the internet. On-premise software is sometimes referred to as “shrinkwrap” software, and off-premise software is commonly called “software as a service” or “computing in the cloud”.
• The on-premise approach to deploying and using business software was the most common until around 2005 when software running at a remote location became widely available and adopted. The new, alternative deployment and use model typically uses the Internet to remove the need for the user to install any software on-premises and had other accompanying benefits: running software remotely can result in considerable cost savings because of reduced staffing, maintenance, power consumption, and other factors.
• Since the advent of software run remotely, on-premise software has sometimes come to be called “old-style” software, although it is still the preferred model in some industries such as banking, finance, and defense, where the ability to supervise and secure data on-premises that are locally owned or controlled is required.

What about security?

One of the arguments you’ll hear from the “old style” solution providers is that the cloud isn’t secure enough for corporate data. That was probably true ten years ago, but cloud computing has some very innovative technology pioneers behind it – Amazon, Google, Cisco, etc. – and the incredible investments in cloud infrastructure and ever-improving standards in security have been driven by them. The simple truth is that the cost-effectiveness of the cloud generally outweighs the security argument in all but the most extreme cases of sensitive data. In our experience, nearly all of the companies who look at it, regardless of size or complexity, determine that the risk does not outweigh the reward. The exception is where millions have already been invested to consolidate the enterprise on an ERP platform, like SAP, and the IT strategy at a company revolves around that effort. In these cases, HighRadius offers Accelerators for SAP that reside natively in the SAP application, thereby delivering the same low TCO as the cloud since they utilize the same servers and support staff as SAP.

For our accounts receivables and credit customers, cloud-based solutions have not historically been the “norm”. We’re hoping to provide some good education and would love to hear your thoughts.