Aim For The Clouds: Cloud Computing In Small-Medium Enterprises

This month the innovation article will be focusing on Cloud Computing. We will be talking about what it is, how it works, a major misconception about cloud computing to do with security and why it is important to small-medium businesses.

What is ‘the cloud’?  How does it work?

To put it simply the cloud is a term used in technology to define any service or storage system that is accessed through a network (Internet) from a different location. Unlike the name implies the cloud doesn’t just float around on the internet; the data or services are stored on immensely powerful servers within large, ultra secure data centres (Picture a warehouse full of servers). The types of cloud based services can range from simple storage services such as Google Drive/Dropbox to more sophisticate client record management systems such as Salesforce or even companies that offer complete ‘virtualisation’ which basically means all your software is run from their centre and streamed to your office systems. Those are just a small amount of the potential uses for cloud computing; their potential as a means for innovation and change is outstanding. To further explain how these types of systems work it is helpful to use the example of a cloud computing service we are all familiar with such as the internet banking website/app almost all banks offer their clients.

Example: The process of starting your internet banking app/website while being connected to the internet is the beginning of your cloud interaction. By entering your identification ID and pin you identify who you are to the data centre’s servers so they can do the hard work of retrieving the correct information for you. Any changes or actions you undertake to your account is conveyed to the servers where the changes are made and saved. The cloud nature of this interaction is that you can access your account from anywhere on any compatible device as long as you have a stable network connection (internet) and your required identification or passwords.

Put another way, utilising a cloud storage service or a cloud computing solution is like having access to a safe deposit box that is not only accessible anytime and anywhere but also like having an army of workers available to you to undertake complicated tasks related to the contents of that deposit box. The cloud is about more than just storage it is about utilising the processing power of these data centres to allow small, medium and large companies to undertake colossal tasks, easier and more affordably.

Misconception About Cloud Computing Security 

Within business particularly the small-medium enterprise market there remains some hesitance regarding cloud based services. The major cause for the hesitance for adopting cloud based solutions is fear. Companies fear that there are security issues by having information stored offsite and accessible over the internet. There are some obvious misconceptions fuelling these fears and a lack of understanding about the power, significance and potential of adopting a cloud based approach for your technology needs.

To dissolve this fear about security we have to consider the simple fact that the data centres used for major cloud computing operations are the banks of the digital age. Major data centres (Such as Equinox in Sydney and others) contain huge amounts of sensitive data from the private sector (banks, lawyers, financial services) and even government data. These data centres are almost always highly secure digitally and physically. A simple Google search investigating the security of these centres will show that most have 24/7 security guards, CCTV, gates, fences, pass cards, pin codes or even biometric scanning systems. On top of this all data centres always have disaster plans in place, whereby they are able to still operate or transfer your data to another centre in the event of emergencies. That is just the usual physical security features, almost all data centres also have full time staff who maintain the condition of the servers and also deal with any cyber security threats. In fact the hardware in the centres themselves is often specifically designed to be very difficult to hack into, certainly much harder than hacking into an office network or computer.

At this point after discussing what cloud computing services are, how they work and the major barrier to their adoption you might be asking yourself why is cloud computing important to small-medium enterprises? The answer is not simple in that because of their versatility and potential they can fulfil a number of roles for small to medium sized companies. That being said in a study conducted by MYOB, Australia’s most prevalent business management software provider over 1,000 organisations identified their reasons for utilising cloud based systems, which were:

– The ability to work on our data whenever and wherever we want (42%)

– Allows for one or more team members to work remotely when needed while maintaining work continuity (28%)

– Allows the company to reduce the number of IT issues they have to fix (26%)

– Their data was more protected within a cloud based system than on their own servers (23%)

– Reduced their IT software and support costs (18%)

– Allows real time connectivity to other sources of data accessible over network (e.g. banking details loaded into the cloud) (16%)

– Provides faster networking and processing than previous system (15%)

– Reduced cost and increased flexibility with IT software and services (15%)

– Removes the need to maintain and install software on office systems (15%)

* Information adapted and used from the MYOB Industry Research paper titled Australia SMEs & Cloud Computing


Upon reviewing these reasons given by leading SMEs who utilise cloud based services it can easily be seen how and why they can be so important to companies that want to grow and innovate their business.