Sunday, October 4, 2015

How Small Businesses Are Successfully Saving Money With The Cloud

This article by Robert Cordray, a former business consultant and entrepreneur, focuses the impact that switching to the cloud has had on small business. Studies done by business software companies Exact and Pb7[1] show that small businesses “doubled their profits and achieved a 25 per cent increase in revenue growth through the virtualization of their data”[2]. According to the article, there are six major reasons small businesses are able to save money by switching to the cloud.

One of the points made by the article is that using the cloud drastically reduces hardware installation, maintenance, and update costs. A large sum of the costs faced by companies in this age is the constant increase in hardware power and capability. Switching to the cloud increases the amount of money that can be spent in other areas of the business that would have gone towards costs associated with hardware. The second point made by the article is that it would effectively eliminate the need for IT staff and would create more office space. Not only would they be able to pay less people, space that would be taken up by equipment can be allocated to other needs and growth. Finally, the article touches upon how using the cloud “improves collaboration and saves time” (Cordray). Using the cloud means anyone in the company, anywhere, can access information and collaborate in real time. It also allows everyone connected the access to any software necessary to the function of the company similarly to a star network typology where the cloud is the host.

While the reasons stated above could surely describe a decrease in costs and therefor an increase in revenues, the article mentions nothing about the costs of switching over to the cloud from a hardware-based, IT staff-driven company. It could potentially be a very expensive and lengthy transition that some small business most likely can’t afford. The article also doesn’t mention any negatives like how this will ultimately eliminate jobs that businesses consider obsolete. It also would have been constructive if the article had a business that uses the cloud vs one that doesn’t as a comparison. Without these counter approaches, the article is very one sided. 

[2] findings show small businesses that made a move to the cloud doubled their profits and achieved a 25 per cent increase in revenue growth through the virtualization of their data.”


  1. While I do see how switching to the cloud would be useful for small businesses, I do see a security problem associated with this switch. The cloud is something that has become very commonly known in society; most people use ICloud with their Apple devices to preserve their information throughout multiple devices and most people know how to use it well. Since so many people know how clouds work, I do see the potential for a security breach. Other rival businesses may be able to hack a business's cloud, thus creating a threat to the business, especially when the cloud is a host. I also see a problem with the cloud when it comes to employment. While having a cloud may reduce the need for IT employees, it does increase unemployment. I have always seen IT as a growing field to work in, so the idea that their jobs may be eliminated by a new software surprises me. Instead of fully eliminating positions in their IT department, I believe companies should keep them around to make sure their cloud is secure and working properly.

  2. I very much agree with what this article argues. I think that the idea of a cost reducing cloud strategy is quite attractive for many business in numerous markets. The part talking about reducing the amount of jobs seems on the surface bad on a macroeconomic level, because unemployment is always something to be considered. However, if we look are looking at advancing the longevity of a company, moving to the cloud and reducing staff would mean less human error, and overall, the company would run more efficiently.
    Also, security is always an issue, and making the cloud a "host" on what would be a "ring" structure means that the company would be slightly more vulnerable to hacking attacks or host failure if ever the cloud went down or could not be accessed.


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