Cloud computing started with virtualization – “software machines within hardware machines”.

As virtualization increased, it expanded out of software operating systems to include applications, services, platforms, and infrastructures, but is NOT Cloud. Cloud computing is a combination of information systems resources that provide web online services. Cloud computing encapsulates 3 main integral components: Software as a Service (SaaS), Platform as a Service (PaaS), and Infrastructure as a Service (IaaS)

OK, so Cloud Computing eliminates hassles, in theory it should always be available, it is location independent, and it should reduce the cost of IT administration. It is important that when weighing Cloud against traditional application all costs need to be taken into consideration – direct and indirect.

Some of the biggest concerns with Cloud Computing today are: Data security, Ownership of data, Business Continuity, E-Discovery, and Compliance.

Here are the top 10 things to consider when moving to the Cloud:

  1. Know your business and evaluate business needs: It is very important to know where you are now and where you will be after getting into the Cloud! Before implementing Cloud computing, every IT manager needs to first identify the requirements and look at the business reason for the move.  Knowing your business needs and processes is detrimental to the final decision and success of the Cloud implementation.
  2. Define the applications desired to be in the Cloud: Not all applications are good candidates for moving to the Cloud. In fact, in some cases it doesn’t make sense to move applications that were not built for the Cloud into the Cloud. You should be thinking about taking advantage of new applications built and developed for the Cloud. I am not suggesting that this is true for 100% of the applications and business cases, but it is definitely something that needs to be carefully evaluated. Some businesses may also  have low or zero latency tolerance which would determine if a Cloud based application is going to fit their needs or not. You may not want to put an application in the cloud upon which the business depends—even if infrastructure limitations (scaling, support, response time, etc.) make it seem like an attractive option. Get your feet wet before diving in. A safer approach might be to start with a low-risk, back office (non-strategic) application before setting your sights on more ambitious targets.
  3. Evaluate Cloud service providers and their potential for longevity and movability between providers: Find the right Cloud vendor and ask to be setup to use their trial, if not already offered from their website. Try to test more than one solution or product / service and find the one that best fits the business needs, even if that means setting up test labs, spending more money and achieving longer time to implement. Remember that your business is at stake and extra caution must be used with Cloud applications. Do your due diligence just as you would for any other locally installed application.
  4. Determine “true” cost: The traditional application cost are mainly associated with licenses, customization, implementation, IT support, training for custom applications, network infrastructure, servers, data storage, backup, and application support & maintenance. On the other hand we have Cloud applications which usually have subscription fees, configuration fees, internet access, end-user support usage fees, and training fees. When your companies look into Cloud based applications they should also consider some other costs that may not be so obvious: monthly fees over time, incremental users, storage fees, integrations, business process re-engineering, termination and cancellation fees.
  5. Establish a Risk management & Cloud Computing committees: A good practice when working on large scale projects such as moving application or services into the Cloud is to establish risk management and security committees. Try to engage and get a buy in from the high level executive teams based on detailed research, analysis and testing that directly relates to your own company, not someone else’s.
  6. Determine the impact on legal, compliance, security, service agreements: Due to the nature of SaaS services and applications, SLA (Service Level Agreements) are very important and should not be overlooked. Serious Cloud vendors will most likely strive to prove their customers with 99.9% uptime, where in reality 90% is fine. SLAs are very important and no customer should sign up for any Cloud product or service before reading through the SLA agreement and feel satisfied with it! The most important things to look at when reading through SLAs are: Availability & Uptime, Guarantees for system performance, Security, Data ownership, and Error resolution.
  7. Determine security strategy for data in transmission/rest: In a recent survey by BDO Sideman, 44% of CFOs responding have resisted the shift to Cloud Computing due to security concerns, hassle, expense, and limited application features. When evaluating Cloud Computing vendors you need to make sure you do your own GOOD research. Do not simply believe others and their recommendations. Your business may be different in many ways. In that perspective, your demands, expectations and comfort levels are also going to be different. Find out where your data is going to be stored, who will have access to it, and how long will it be retained on the vendor’s storage. The connection between the client and the hosting provider must be a secure connection, not a series of port-level connections to the client. They must have VPN/SSL connectivity at a minimum. Make sure to ask for SAS 70 reports, Third party data center reports, ownership of data, DR procedures and promises, audit ability, determine the desired physical security controls and make sure you read all contractual documents!!!
  8. Disaster Recovery and Business Continuity: The Cloud changes the way your business is run and the way your employees and customers are interacting with the different systems. The cloud also changes what’s needed for disaster recovery; it’s different than what you need for server-client and network infrastructures. Having your applications moved to the cloud does not mean that you should not have a DR plan or Business continuity plan! On the contrary – you should spend good amount of time reviewing what changes must be implemented to support your business in case the Cloud provider incurs a major downtime.
  9. Fully redundant local internet access: Cloud computing relies heavily on the connection to the internet. The beauty of it is that every employee or user can get access to the data no matter where they are located as long as they have a valid internet connection. The downside of that is that if the internet connection in the office building goes down then access to business applications and data is also cut. Not only that but any data that may have been in transmission could be damaged or corrupted. Having two fully redundant internet connections from two different providers reduces the risk of downtime and data loss, but it is an added expense and may deem Cloud computing integration unworthy.
  10. Review contracts to ensure benefits are true: Make sure that everything you want is in the final version of the contract! If you do not have the internal legal expertise to review and change the terms of the contract, then you need to hire an experienced professional. Do not forget to also demand for the executed copies of the final contracts.

Cloud computing has gone a long way and it offers great benefits for most companies that embrace it. Many people like the concept and would like to at least test it, but in reality IT decision makers and business owners still fear the Cloud due to all security uncertainties associated with it. Cloud computing is generating a big hype right now, but it could be a really bad business investment for a lot of businesses that either overlook the details or contract with the wrong Cloud vendor. Make sure that the vendor of choice is flexible, offers an array of services, has good reputation and can meet your current and ongoing needs as your business grows or scales back.

Here is quotation to think about when evaluating Cloud computing options or strategies:

“My biggest fear is loss of client data if the SaaS provider goes out of business. If every software vendor goes out of business tomorrow, I can continue to function with the software I have loaded on my server for another 10 years” – Dave Brotemarkle www.bdcocpa.com

For more exciting news and information on Cloud computing, please visit us on: https://www.saaschronicles.com or follow us on Twitter (http://twitter.com/saaschronicles)

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