Article Analysis SME Still Scared of the Cloud

Question: Describe about the SMEs still scared of the Cloud? Answers: Cloud computing is considered as the future of the business models for both large and small scale enterprises. The adoption of cloud computing methods as part of information technology usage by the SME (Small and Medium Enterprises) is the key discussed topic of this essay. The Information and communications technology functions such as effective data storage, retrieval, analytics, and overall management of the data may be put in the cloud by the SMEs (Francis, 2014). The action of putting IT (Information Technology) functions in the cloud refers to outsourcing of the data management function of IT to a third party who maintains the key business data on a cloud server. The cloud computing allows all the information communications and technology data generated by the business operations of the SMEs, to be stored on a remote server. This concept of using a remote server, instead of maintaining a server in the premises for maintain the backup of all the business data, is the key revolution in Information technology management, that SMEs are slowly turning to (Harding, 2013). This activity of using cloud for information technology functions allows SMEs to use shared network and pay only to the extent of usage. This enablement of resource sharing allows the SMEs to have the same quality of Information Technology and Software services as that used by the large companies at much lesser costs. The service providers of cloud networks work on the principle of economies of scale and can provide the best quality of Information technology services to SMEs at affordable rates. SMEs would definitely prefer to use cloud computing technology and would immensely benefit from these actions due to the following reasons (Duan et al., 2013): 1. SMEs would no longer require investing resources in maintaining servers at their premises.2. The costs of other Information Technology components that are supported by server such as the networking components, data storage, related software application, etc. would be eliminated.3. There would be increased opportunities driven by business analytics for the SMSs, which would be possible due to extensive data availability at hand due to adoption of cloud computing technology.4. There would be lesser IT staff in the organizations (the staff managing server applications wont be required). 5. These would be lower power and maintenance expenditure by the SMEs.6. The Programs and applications used by the employees could be accessed across the internet from any nook and corner of the world. Several of the analyst and researchers have measured the degree of acceptance of cloud computing technology by the SMEs. However, this Information technology revolution is still not widely accepted by several SMEs. Uncertainly of reliability on the new setup, is the most prominent reasons observed for several of the SMEs that are unsure to join the cloud technology band wagon (Pieterse, 2013). The Security concern of the data maintained on the cloud is regarded as one of the prominent mental blocks for the management of the SMEs to adopt cloud technology in its business operations. The fear of change and unknown is highly influencing the office bearers of SMEs from quick adoption of the new technologies and functions. The concerns regarding the limited bandwidth, due to the poor quality of network infrastructure are another issue faced by SMEs for putting IT functions in to the cloud. The lack of awareness and lack of understanding of the core concept of using the cloud computing for information technology purposes is holding back the SMEs from putting its IT functions in the cloud. Besides several of the SMEs find it unsafe in investing in cloud technology, due to the rapid technology changes and advancements in the technology world, that might be difficult for SMEs to keep up the changes. The following are the IT functions that SMEs may put in to the cloud for achieving better control and efficiency in the business: 1. All the important business applications can be hosted in the cloud, and data pertaining to these applications can be accessed via internet. Eg. Google docs are an application that uses cloud technology to maintain several data and information in document format, of the multiple web users. 2. Email services, Internal Messenger Services may be hosted in the cloud by the SMEs. Hosting on reliable service providers such as Google enables these small companies to maintain its data securely (Pieterse, 2013).3. Small office based application suites as per the nature of the Business run by the SMEs are available in the market that can be availed by the budding SMEs. Let us take example of Australian Dairy Farmers; this small dairy business avails the usage of cloud technology for managing its critical data (Powers, 2013). The several other small business such as Dairy, Poultry or Bakery Business, can also avail the custom made cloud service packages for managing their customized office ba sed applications remotely. 4. Back up services and Data storage are the major areas that may be outsourced by the SMEs to cloud services providers. 5. We may take another example of movie ticketing business, bookmyshow. This SME puts real time booking services, as the IT application to be managed by a cloud network service provider (Khosla. 2013). We may conclude that the cloud technology is capable of providing some real advantages and convenience to the SMEs in terms of increasing their business efficiency, establishing remote working potential and saving of physical spaces of the business premises (Khosla, 2013). But the SMEs also need to take care of the pitfall of putting IT functions in cloud. The reputation and service quality of the cloud service provider should be cross checked by SMEs with detailed cost benefit analysis before outsourcing the IT function. References Duan Jiaqi, Faker Parwiz and Dtuart Tim, (2013). Benefits and drawbacks of cloud-based versus traditional ERP systems. Proceedings of the 2012-13 course on Advanced Resource Planning. Retrieved on February 2nd 2015 from https://www.academia.edu/2777755/Benefits_and_Drawbacks_of_Cloud-Based_versus_Traditional_ERP_Systems Francis Hannah. (2014). SMEs still scared of the cloud: ACMA. The Australian. Retrieved on February 2nd 2015 from https://www.businessspectator.com.au/news/2014/3/26/technology/smes-still-scared-cloud-acma Harding Chris. (2013). Cloud computing for small businesses: its time to follow the herd. Retrieved on February 2nd 2015 from https://www.theguardian.com/small-business-network/2013/jan/30/cloud-computing-for-small-businesses Khosla Bikky. (2013). Cloud computing where SMEs stand. SME Times. Retrieved on February 2nd 2015 from https://www.smetimes.in/smetimes/editorial/2013/Oct/08/cloud-computing-where-sme-stand630252.html Pieterse Ilva. (2013). SMEs and the local landscape. Retrieved on February 2nd 2015 from https://www.iweek.co.za/special-report/smes-and-the-local-landscape Powers Craig. (2013). The cloud calls on SMEs: Will more take advantage? asug news. Retrieved on February 2nd 2015 from https://www.asugnews.com/article/sap-cloud-smes-survey-adoption