You’ve probably been hearing a lot more these days about “the cloud.” But do you really know the full extent of the benefits to your business? Here’s how to find return on investment (ROI) from moving to the cloud.
As someone steeped in the world of small businesses, I’ve noticed a major change in attitudes about this nebulous thing called the cloud.
A few years ago people were saying “Cloud? What cloud are you talking about?” Now I’m hearing “Cloud? We want to be using the cloud, and we’ve started using the cloud, but we are still trying to get our arms around it.”
If that latter sentence describes you, you’re by no means alone.
The cloud is powerful. Yet, many of us are still in the beginning stages of figuring out all the ways to harness the power of the cloud and what it can mean for us.
It’s that way in my own business. Here at Small Business Trends, we are a publishing company. We embrace the cloud. Yet every month, if not every week, we discover new ways to use the cloud and new benefits.
I’d like to suggest five benefits of operating your business “in the cloud” (reasons to move to the cloud) for you to consider:
Reason to Move to the Cloud #1: Manage Cash Flow
One of the most obvious benefits is that you don’t have up-front costs of buying software packages if you use cloud applications.
A few months ago, I visited the Microsoft headquarters. One of the things I learned was that the fastest adoption of Office 365, the cloud version of Microsoft’s Office suite, was coming from small businesses.
That doesn’t surprise me because money plays a role. You can spread costs out on a monthly or possibly annual basis for most cloud software. You don’t have to take a cost hit to buy all your software licenses up front.
That’s particularly important if you’re growing. As you add employees, the incremental costs of outfitting them in your business are kept low. And since most of us hire “ahead of revenue,” it’s important to minimize the front-loaded expenses.
The same benefits are available when it comes to hardware. If you can minimize your investment in hardware — such as through cloud hosting of websites or using virtual servers for your systems — you cut down not only on the cost of the initial purchase of the hardware, but on the ongoing maintenance of it.
Simply put, the cloud helps you manage cash flow by spreading out costs into smaller monthly increments.
Reason to Move to the Cloud #2: Get Wider Choices
Today, I think it’s fair to say that most new software being developed for small business applications is being developed as cloud applications.
Have you been to the big box store and looked in the software section recently? It used to be that you’d see shelf after shelf of boxed software that you would buy and load on a computer. Now those shelves have shrunk.
When I look at my business, most of the software we use is an online cloud version. Increasingly, it also includes mobile functionality so we can do work using tablets and smartphones.
Chances are, if you want an application to automate a workflow or perform a function in your business, it is going to be offered solely as a cloud (online) version, along with some level of mobile access.
All the smart new software innovation is happening in cloud applications.
If you want the widest possible choices of the most up-to-date software solutions, go for the cloud.
Reason to Move to the Cloud #3: Automate and Drive Efficiencies
An inherent advantage of cloud applications is the ease of automating manual activities. You see, with cloud applications it’s getting easier everyday to transfer your data from one software application into another electronically.
Instead of manually entering data in multiple screens or applications, you can enter it once, or even capture it from external sources. Then that data populates in multiple places automatically.
This lets you automate entire processes, end to end, even if you use three or five different software packages for different parts of your process.
For instance, take the handling of customer support inquiries. Your business can achieve huge internal efficiencies with a VOIP or software-based telecommunications system that is integrated with your help desk software, customer contacts database, and email.
It’s technically possible to achieve the same result by using non-cloud applications. But it’s also technically harder that way.
With the cloud you can accomplish it seamlessly with less work and less expense.
Reason to Move to the Cloud #4: Gain Better Insights Into Your Business
You can’t change something if you don’t (a) measure it, and (b) understand what’s working and what isn’t. For that, you need data. More importantly, you and your team need to be able to “see” that data at the right times and in the proper contexts.
Cloud applications let you move data across applications, so that you’re not looking at data in isolation. The cloud breaks down silos and information roadblocks.
Cloud applications also allow you to easily export data to dashboards and business intelligence applications. That means you can analyze information better. If you or your team ever find yourselves saying, “I wish we could get that data or see those numbers,” then the cloud may be the answer.
Who knows what improvements you can make in your business and what opportunities you could capture, once you can truly see the relationships between sets of data?
Better insights, better business — all come from the cloud.
Reason to Move to the Cloud #5: Grow – Cost Effectively
Last, and perhaps most importantly, the cloud is the answer for small businesses that want to grow, while keeping costs low.
Let’s face it. In most of our businesses, the difference between operating at a nice profit and operating at a loss is a relatively slim margin.
Growth takes money — money to invest in sales, marketing, product development, operations expansion and more. Finding money to grow isn’t that easy.
One way to find that extra money and growth capacity is from within. What I mean is, you can find some of it from continuous process improvement where you shave costs, while at the same time increasing capacity. You find ways to accomplish more, in less time, and without adding people, equipment and other expenditures that eat profits.
With the cloud you can keep your IT equipment costs low, and minimize your hardware and software maintenance costs.
More importantly, the cloud helps keep people costs low. One of the benefits of automation is that your business can do more with fewer man hours.
Labor tends to be one of a small business’s largest expense buckets. Sometimes it accounts for 75 percent of expenses, or more. The extent to which you can grow without adding people is a huge factor in profitability. Cloud based automation of workflow and processes helps you accomplish that.
And when you do hire, you can do so for a higher level of talent to add strategic value. Why? Because automation handles many repetitive manual tasks.
It’s part of the reasons to move to the cloud. And it’s just one more benefit of this nebulous thing called the cloud.
At the time of writing this article, Anita Campbell is participating in the Microsoft Small Business Ambassador Program. This article is part of a series underwritten by Microsoft.
Cloud Computing image via Shutterstock