Tuesday, July 26, 2011
Sunday, July 17, 2011
Enterprise Mobile Email and Connectivity
Increasing Employee Productivity:
A major roadblock to off-hour and out-of-office productivity is that employees who are out of the office have limited access to their corporate email, calendars, and contact lists. Having up to the minute access to these systems is an essential part of conducting business. In order to establish an advanced mobile workforce your employees will need the following: a smartphone, a stable internet connection and the lynchpin: an advanced mobile email suite that can synchronize calendars, contacts, and emails in real time.
Employee productivity has been harmed by inadequate internet access, blocked by spotty and unreliable WiFi hotspots, unreliable internet at Hotels and Coffee shops, lack of broadband service, forcing employees to use dial-up internet services, and cumbersome VPN clients riddled with errors.
It is fortunate that with a smartphone, the internet connectivity issues are answered and resolved. In order to use a smartphone, wireless providers require a reliable 3G or 4G internet connection to be bundled. A stable internet connection is included with every smartphone sold. Two birds with one stone.
Furthermore, smartphones are the leading edge of today’s advanced technology. While technological progress has largely stagnated with desktop and laptop computers, the rate that smartphones are gaining capabilities parallels the exponential growth of desktop computing technology in 90s and 00s.
How do you increase your employee’s productivity? Start a companywide smartphone program. Employees who have access to their email are more productive. Email access allows them to better plan their day and actions: Employees can access their synchronized task list, and calendar; they can reschedule events on the fly from their phones. They have the ability to react rapidly, critical for maintaining your success. Employees can remain productive on call, and can respond to emails, schedule meetings, and reach out to clients even while away from the office.
Smartphones are now are easier to use than even the simplest desktop operating system, ending the steep learning curve normally associated with computers and providing a positive experience. Leveraging these technologies it is a natural progression of a long-term corporate information technology strategy.
The Smartphone Ecosystem:
A typical smartphone has more raw processing power than your computer had in the 2000-2002 timeframe. Advanced power-saving CPUs, capacitive touchscreen displays, and intuitive graphical user interfaces have also lowered the learning curve of operating smartphones. What would have been a cumbersome operation five years ago is literally two gestures and a flick of your finger away on a smartphone utilizing today’s technology.
The smartphone marketplace today is a thriving ecosystem of several major operating systems, each with their own suite of applications which can add to essential business productivity. Perhaps the most well-known, is the iPhone running the iOS operating system. Apple has designed the iPhone from the ground-up for ease of use, and has resulted in a device that virtually does not have a learning curve. The iPhone is largely responsible for helping shape the essential functions of modern smartphones.
Apple has smartly integrated the latest Microsoft server technologies in iOS to allow it to synchronize with Microsoft Exchange servers, the leading corporate email platform. Apple’s careful and methodical integration of Microsoft’s “ActiveSync” standard has resulted in a fully secured mobile workstation, compliant with corporate IT policies.
Google’s Android smartphone operating system is currently the only major competition that iOS has in the smartphone market. The Android ecosystem is larger, offering a large number of different phones, each with differing capabilities. The Android operating system is also open source, which allows for virtually every smartphone manufacturer to customize various aspects of the system, and place their own front-end customizations. The differing capabilities also apply to the various functions supported by ActiveSync. While virtually every Android smartphone will offer some sort of ActiveSync functionality, not all devices are fully supported – not every function will work on all Android devices. As such, if a corporation were to sponsor Android phones, it would be its responsibility to ensure that the devices they are planning to equip their employees with are capable of the functions that are required.
Windows Phone 7 is the new player on the scene, with an innovative operating system that gives the iPhone a run for the money in the ‘ease of use’ department. As it is also a tightly controlled operating system, and designed by Microsoft, it is fully compliant with each function that ActiveSync offers.
BlackBerry is another option for a smartphone user. BlackBerry tends to be the operating system of choice for companies and governments that require high security. The BlackBerry is designed from the ground up with a focus on security, and as such can be more difficult to learn how to use. BlackBerry is the only major smartphone platform that does not utilize ActiveSync.
Technology that Brings your Phone to the Cloud
ActiveSync is a Microsoft developed technology, originally designed to be used with Windows CE, and early Windows Mobile revisions, and was first implemented by Microsoft in the Exchange Server 2003 advanced email suite. ActiveSync is a ‘push’ based delivery system, capable of synchronizing a mobile phone contact list, calendar, and email in real-time. As new email arrives at the mailbox, ActiveSync actively ‘pushes’ the email to the device that is connected to the server.
ActiveSync is only available with Microsoft Exchange Server. Microsoft Exchange Server is the premier business-oriented enterprise email system, the most fully featured and widely supported corporate mail system on the planet today. Exchange was originally designed for in-house closed networks, but has expanded to being one of the most mature Cloud Computing offerings for businesses to select today. A businesses’ entire in-house email system can be outsourced with tremendous cost savings, and yet still improving on the accessibility and feature set.
The ActiveSync standard has been refined and updated numerous times, adding much necessary Enterprise functionality, and bringing security to a level which was previously only available with proprietary closed email solutions (such as RIM’s Blackberry phones and service offering). System administrators can remotely set phones to require passwords, require passwords to be changed on a regular basis, encrypt phone memory, and in the event the phone is lost, the phone can be remotely wiped clean of all company data, and restored to its original factory state.
The only major ‘competitor’ to ActiveSync is the Blackberry service offering by Research in Motion. RIM’s Blackberry service is especially tailored for businesses where security is the top concern, above all other considerations. Much of RIM’s business is subsidized by governmental use in the United States, with RIM’s software and security solution the choice of the US Department of Defense for remote employees who need email, contact, and calendar synchronization on-the-go. Those who are away from the office have virtually the same functionality as ActiveSync – they can synchronize their emails, calendars, and contact lists in real-time, and offers more robust security than ActiveSync can offer.
The drawbacks of RIM’s solution are cost, and loss of ease of functionality. RIM’s operating system lacks the same panache that iOS or Android platforms are able to offer. The phones offer far fewer applications, can be more difficult to use, with a steeper learning curve – but offer superior security and reliability as compared to ActiveSync-based solutions. RIM’s platform is also adopted to be used on multiple corporate email solutions – it is not limited to Microsoft Exchange.
By switching your business email systems to a Cloud-based Microsoft Exchange hosting provider, your company gains the capability to field an efficient mobile workforce.
The Bottom Line
Modern smartphone technology can create a 24/7/365 workforce at your company, increasing the company’s flexibility and productivity. A ‘connected company’ strategy emphasizing smartphone use for employees can be financed by leveraging the Cloud – by moving your company’s in-house email systems to The Cloud, you can recognize a cost savings numbering hundreds of thousands of dollars yearly – which can pay for a significant chunk of the expenses required to adopt a smartphone strategy.
It’s the 21st century, we’re stepping further and further into the future each day – and giving your employees a 24/7/365 capability to respond to immediate business needs helps maintain your competitive advantage; helping you to build a faster, more connected company with anytime access to the business intelligence that adds to the bottom line. In a fast moving, information based economy – instantaneous information is a requirement to stay relevant. Fortunately, adopting these technologies is cheaper than ever before, with more options than at any point in the past to equip your mobile workforce.
Copyright © Daniel J. Serri, All Rights Reserved. July 17, 2011
A major roadblock to off-hour and out-of-office productivity is that employees who are out of the office have limited access to their corporate email, calendars, and contact lists. Having up to the minute access to these systems is an essential part of conducting business. In order to establish an advanced mobile workforce your employees will need the following: a smartphone, a stable internet connection and the lynchpin: an advanced mobile email suite that can synchronize calendars, contacts, and emails in real time.
Employee productivity has been harmed by inadequate internet access, blocked by spotty and unreliable WiFi hotspots, unreliable internet at Hotels and Coffee shops, lack of broadband service, forcing employees to use dial-up internet services, and cumbersome VPN clients riddled with errors.
It is fortunate that with a smartphone, the internet connectivity issues are answered and resolved. In order to use a smartphone, wireless providers require a reliable 3G or 4G internet connection to be bundled. A stable internet connection is included with every smartphone sold. Two birds with one stone.
Furthermore, smartphones are the leading edge of today’s advanced technology. While technological progress has largely stagnated with desktop and laptop computers, the rate that smartphones are gaining capabilities parallels the exponential growth of desktop computing technology in 90s and 00s.
How do you increase your employee’s productivity? Start a companywide smartphone program. Employees who have access to their email are more productive. Email access allows them to better plan their day and actions: Employees can access their synchronized task list, and calendar; they can reschedule events on the fly from their phones. They have the ability to react rapidly, critical for maintaining your success. Employees can remain productive on call, and can respond to emails, schedule meetings, and reach out to clients even while away from the office.
Smartphones are now are easier to use than even the simplest desktop operating system, ending the steep learning curve normally associated with computers and providing a positive experience. Leveraging these technologies it is a natural progression of a long-term corporate information technology strategy.
The Smartphone Ecosystem:
A typical smartphone has more raw processing power than your computer had in the 2000-2002 timeframe. Advanced power-saving CPUs, capacitive touchscreen displays, and intuitive graphical user interfaces have also lowered the learning curve of operating smartphones. What would have been a cumbersome operation five years ago is literally two gestures and a flick of your finger away on a smartphone utilizing today’s technology.
The smartphone marketplace today is a thriving ecosystem of several major operating systems, each with their own suite of applications which can add to essential business productivity. Perhaps the most well-known, is the iPhone running the iOS operating system. Apple has designed the iPhone from the ground-up for ease of use, and has resulted in a device that virtually does not have a learning curve. The iPhone is largely responsible for helping shape the essential functions of modern smartphones.
Apple has smartly integrated the latest Microsoft server technologies in iOS to allow it to synchronize with Microsoft Exchange servers, the leading corporate email platform. Apple’s careful and methodical integration of Microsoft’s “ActiveSync” standard has resulted in a fully secured mobile workstation, compliant with corporate IT policies.
Google’s Android smartphone operating system is currently the only major competition that iOS has in the smartphone market. The Android ecosystem is larger, offering a large number of different phones, each with differing capabilities. The Android operating system is also open source, which allows for virtually every smartphone manufacturer to customize various aspects of the system, and place their own front-end customizations. The differing capabilities also apply to the various functions supported by ActiveSync. While virtually every Android smartphone will offer some sort of ActiveSync functionality, not all devices are fully supported – not every function will work on all Android devices. As such, if a corporation were to sponsor Android phones, it would be its responsibility to ensure that the devices they are planning to equip their employees with are capable of the functions that are required.
Windows Phone 7 is the new player on the scene, with an innovative operating system that gives the iPhone a run for the money in the ‘ease of use’ department. As it is also a tightly controlled operating system, and designed by Microsoft, it is fully compliant with each function that ActiveSync offers.
BlackBerry is another option for a smartphone user. BlackBerry tends to be the operating system of choice for companies and governments that require high security. The BlackBerry is designed from the ground up with a focus on security, and as such can be more difficult to learn how to use. BlackBerry is the only major smartphone platform that does not utilize ActiveSync.
Technology that Brings your Phone to the Cloud
ActiveSync is a Microsoft developed technology, originally designed to be used with Windows CE, and early Windows Mobile revisions, and was first implemented by Microsoft in the Exchange Server 2003 advanced email suite. ActiveSync is a ‘push’ based delivery system, capable of synchronizing a mobile phone contact list, calendar, and email in real-time. As new email arrives at the mailbox, ActiveSync actively ‘pushes’ the email to the device that is connected to the server.
ActiveSync is only available with Microsoft Exchange Server. Microsoft Exchange Server is the premier business-oriented enterprise email system, the most fully featured and widely supported corporate mail system on the planet today. Exchange was originally designed for in-house closed networks, but has expanded to being one of the most mature Cloud Computing offerings for businesses to select today. A businesses’ entire in-house email system can be outsourced with tremendous cost savings, and yet still improving on the accessibility and feature set.
The ActiveSync standard has been refined and updated numerous times, adding much necessary Enterprise functionality, and bringing security to a level which was previously only available with proprietary closed email solutions (such as RIM’s Blackberry phones and service offering). System administrators can remotely set phones to require passwords, require passwords to be changed on a regular basis, encrypt phone memory, and in the event the phone is lost, the phone can be remotely wiped clean of all company data, and restored to its original factory state.
The only major ‘competitor’ to ActiveSync is the Blackberry service offering by Research in Motion. RIM’s Blackberry service is especially tailored for businesses where security is the top concern, above all other considerations. Much of RIM’s business is subsidized by governmental use in the United States, with RIM’s software and security solution the choice of the US Department of Defense for remote employees who need email, contact, and calendar synchronization on-the-go. Those who are away from the office have virtually the same functionality as ActiveSync – they can synchronize their emails, calendars, and contact lists in real-time, and offers more robust security than ActiveSync can offer.
The drawbacks of RIM’s solution are cost, and loss of ease of functionality. RIM’s operating system lacks the same panache that iOS or Android platforms are able to offer. The phones offer far fewer applications, can be more difficult to use, with a steeper learning curve – but offer superior security and reliability as compared to ActiveSync-based solutions. RIM’s platform is also adopted to be used on multiple corporate email solutions – it is not limited to Microsoft Exchange.
By switching your business email systems to a Cloud-based Microsoft Exchange hosting provider, your company gains the capability to field an efficient mobile workforce.
The Bottom Line
Modern smartphone technology can create a 24/7/365 workforce at your company, increasing the company’s flexibility and productivity. A ‘connected company’ strategy emphasizing smartphone use for employees can be financed by leveraging the Cloud – by moving your company’s in-house email systems to The Cloud, you can recognize a cost savings numbering hundreds of thousands of dollars yearly – which can pay for a significant chunk of the expenses required to adopt a smartphone strategy.
It’s the 21st century, we’re stepping further and further into the future each day – and giving your employees a 24/7/365 capability to respond to immediate business needs helps maintain your competitive advantage; helping you to build a faster, more connected company with anytime access to the business intelligence that adds to the bottom line. In a fast moving, information based economy – instantaneous information is a requirement to stay relevant. Fortunately, adopting these technologies is cheaper than ever before, with more options than at any point in the past to equip your mobile workforce.
Copyright © Daniel J. Serri, All Rights Reserved. July 17, 2011
Migrating Your Business to the Cloud
What Is The Cloud?
Cloud Computing is essentially a new name for existing technology - indeed the ‘Cloud’ has existed for a number of years. Many businesses offering services on a remote server over an Internet connection are what we call hosted services. Add scalability and on-demand availability and you get “Cloud”. As such, a more accurate definition of the ‘Cloud’ would be a hosted service available over the Internet with the ability to scale these remote resources instantly and on demand. Several business models reign in the “Cloud” marketplace, such as infrastructure-as-a-service and platform-as-a-service but the most widely adopted model and the one that has the most demonstrated benefits for business is the Software-as-a-Service or SaaS model. The question that must be asked is, ‘Should I migrate my IT systems to the cloud?’
Organizations already have IT systems in place for just about every major function of their business: an email server, a website server, file and document sharing systems, telephone systems, and others. Traditionally these systems are built in-house, by purchasing and deploying the servers, devices, cables, etcetera, on-premise within the building the businesses is housed. This way of buying and deploying IT systems adds to the company balance sheet, yet adds little value compared to outsourced solutions available without exorbitant equipment, licensing, and personnel fees. Virtually every in-house server can be replaced by a cloud-based solution. Cloud technologies offer increased flexibility, scalability, higher standards of care and quality, and higher standards for support, service, and functionality. Hence, your business receives better technology at a fraction of the cost.
Why use the Cloud for your Business?
As many businesses encounter today, the ability of in-house IT teams to efficiently and effectively operate much of the newer technology solutions is diminished as the complexity of the software they must administer increases almost exponentially with each new revision. It is unreasonable to expect a Server Administrator whose duties include administrating a phone system, an email system, VPN, and document sharing system to be an expert in all of these areas. As such, business have to choose between going to the cloud and introduce a business advantage over their competitors in terms of cost, quality of service, efficiency or staying in-house and face a competitive disadvantage, sometimes a fatal one.
Another fundamental shift going on is that SaaS providers are currently snapping up the best talent available – from in-house IT teams, and from the broader market. The talent that you need to run your in-house systems is increasingly difficult to find, as the talented individuals, who ten years ago would have creatively engineered an in-house solution to a business need – are now working with Cloud providers, creatively implementing cloud-based solutions for the broader corporate marketplace.
All in-house systems come at a cost. Upfront hardware and software costs, equipment depreciation, equipment service and replacement costs, lost productivity in end-user training to utilize your specialized systems, infrastructure costs such as electricity, air conditioning, internet access – to keep all the systems up and running, and others – it goes on and on. In sum, owning your own equipment is a huge expense for your business. By making a move toward the Cloud, your business benefits from the investment; the creative implementations of solutions, and cost savings derived from the economies of scale that cloud providers enjoy and are able to pass on to your business.
The Costs of Retaining Systems In-House:
Cloud Computing service offerings are usually based upon a simple flat rate – a monthly per-user fee is typical for most billing arrangements. To draw a comparison, we will use a hypothetical company with 1000 employees requiring advanced email service such as Microsoft Exchange. The company has a choice – they can utilize an in-house solution, or find a Cloud-Based provider that can do it cheaper, better, and deploy the entire service instantly.
If our hypothetical company chose to build the infrastructure in-house, our company would require a physical server – roughly $3000 to purchase the bare minimum of hardware necessary to make the system work. On top of this server, software costs would come into play – you would require a server operating system. Currently, Microsoft charges $1029 for a version of Windows Server 2008 R2, which includes only 5 Client Access Licenses. To get the thousand client access licenses necessary, the cost shoots to $39,950. Our running total so far is $43,979.
We still need to cover the personnel costs involved and we still need to configure the software with the Exchange Server software, a separate cost of $629. A separate set of Client Access Licenses is also required for Exchange Server at a cost of $67 per user – totaling $67,000. Our running tally so far? $111,608. Microsoft’s antivirus solution for Microsoft Exchange server, Forefront Online Protection for Exchange, is priced at $15 per user for a total outlay of $15,000 additional. Total outlay: $126,608. Utilizing the industry standard Symantec Backup Exec for your backup solution yields an additional cost of $1,162 for a single license for the server environment. Total tally? $127,770.
This scenario does not even address the personnel costs and ongoing maintenance for the system – just the immediate upfront costs for building a Microsoft Exchange system in-house at current licensing fees. By means of contrast, an outsourced solution with per user costs of $9.99 per month will result in a monthly fee of $9,990.00 for the users, for a yearly fee of $119,880. Just the upfront costs of a server alone cost more than a year of service with a leading Hosted Exchange Cloud provider.
The Cloud: Pre-built Infrastructure for your Business
Imagine trying to build a power-plant for generating electricity for your business. It makes no sense to generate your own electricity if you can just buy electricity from the grid. This is, in effect, what the Cloud offers your business: enterprise class infrastructure – already built for your company. Cloud service providers are able to field systems managed by experts in their field, and focus on providing the very product you are utilizing, plus offer the highest levels of support.
Cloud Providers are experts in their respective service offering. A provider that focuses on specific service will invariably gain expertise in the underlying platform that would be impossible for companies with other business models to obtain. Regardless of how well financed your in-house IT team is, they will be unable to obtain the same breadth of experience that a Cloud provider can offer unless you are part of a multinational company, upwards of 10,000 users – the only sorts of organizations large enough to retain and maintain a competent in-house IT staff with requisite experts in their fields.
Despite many of the benefits, Cloud Computing solutions are not for every company. Using the Microsoft Exchange hosting model and scenario discussed above, the cost benefits for going with a Cloud Email provider that offers Exchange Server disappear if more than roughly 5,000 users are needed on the same system. A large enterprise may also obtain other cost savings realized through creative implementation of large systems – but the costs of these systems – both upfront, and on an ongoing basis greatly exceed those that would be paid to a Cloud-based hosting provider unless the operation is sufficiently large to offset the ‘economies of scale’ that Cloud offerings are able to leverage.
Vetting Cloud Providers – Are They The Best Fit for your Business?
Most Cloud SaaS businesses will obtain necessary quality certifications for their internal systems. It is a good practice to ensure that the company has met a minimum quality standard. A current SAS-70 Audit will ensure the company’s processes and access control systems are appropriate for a business of the type that you intend to entrust your data to. Certifications as it pertains to operating standards for SaaS companies are critical to assessing the quality of a prospective provider. Without the necessary internal processes in place to ensure that you data is secure, and that the system is up and operational at all times.
Another important area to inspect when signing on to Cloud based SaaS companies is the SLA, or Service Level Agreement. The SLA defines in legal terms what sorts of uptime guarantees are made by the provider, and by agreeing to service, your legal rights are defined within the SLA. It would be good practice to review the SLA of any prospective SaaS provider you plan to do business with.
Cloud Computing has matured to a point that it can replace almost every in-house system. Essentially, business telecommunications can now be outsourced, and the exorbitant costs to house the in-house telecommunications equipment can be done away with.
Predicting the Costs of the Cloud:
Another significant advantage that businesses obtain with Cloud-based solutions is the ability to predict the cost in advance. Existing in-house systems are unwieldy by design, and an unexpected systems failure can result in shooting over budget with additional equipment, software, and licensing fees. With Cloud-Based systems, the only cost you need to know is the monthly fee.
To recap, when utilizing a Cloud based system, you enjoy significant cost savings, and an internal pool of talent that is able to address any issue that may occur with the system quickly and efficiently. In larger organizations with in-house systems, members of the IT team float around between different systems, often times never turning into an expert on the system, and not utilizing it to its full potential. When working with Cloud providers, the provider you are working with is an expert – it is their business to be an expert in the product they offer, and the expertise that works on the systems ensures that best practices will be adhered to.
Companies operating in the Cloud space are also aware that their business depends on perception, and service offered. Service outages are unacceptable, problems and issues need to be rectified immediately. Perception is key to their continued success – which is why Cloud-based offerings will have certifications along the lines of SAS-70. In the event of a service interruption, major damage can result to the company’s brand and image.
In sum, cloud computing offers a number of significant advances in functionality, and allows companies to streamline and better predict their costs. Deployment of systems is instantaneous, service is top tier, and you are working with experts who live and breathe the product that your business utilizes. Adoption of Cloud-based systems gives your company a competitive advantage.
Copyright © Daniel J. Serri, All Rights Reserved. July 17, 2011
Cloud Computing is essentially a new name for existing technology - indeed the ‘Cloud’ has existed for a number of years. Many businesses offering services on a remote server over an Internet connection are what we call hosted services. Add scalability and on-demand availability and you get “Cloud”. As such, a more accurate definition of the ‘Cloud’ would be a hosted service available over the Internet with the ability to scale these remote resources instantly and on demand. Several business models reign in the “Cloud” marketplace, such as infrastructure-as-a-service and platform-as-a-service but the most widely adopted model and the one that has the most demonstrated benefits for business is the Software-as-a-Service or SaaS model. The question that must be asked is, ‘Should I migrate my IT systems to the cloud?’
Organizations already have IT systems in place for just about every major function of their business: an email server, a website server, file and document sharing systems, telephone systems, and others. Traditionally these systems are built in-house, by purchasing and deploying the servers, devices, cables, etcetera, on-premise within the building the businesses is housed. This way of buying and deploying IT systems adds to the company balance sheet, yet adds little value compared to outsourced solutions available without exorbitant equipment, licensing, and personnel fees. Virtually every in-house server can be replaced by a cloud-based solution. Cloud technologies offer increased flexibility, scalability, higher standards of care and quality, and higher standards for support, service, and functionality. Hence, your business receives better technology at a fraction of the cost.
Why use the Cloud for your Business?
As many businesses encounter today, the ability of in-house IT teams to efficiently and effectively operate much of the newer technology solutions is diminished as the complexity of the software they must administer increases almost exponentially with each new revision. It is unreasonable to expect a Server Administrator whose duties include administrating a phone system, an email system, VPN, and document sharing system to be an expert in all of these areas. As such, business have to choose between going to the cloud and introduce a business advantage over their competitors in terms of cost, quality of service, efficiency or staying in-house and face a competitive disadvantage, sometimes a fatal one.
Another fundamental shift going on is that SaaS providers are currently snapping up the best talent available – from in-house IT teams, and from the broader market. The talent that you need to run your in-house systems is increasingly difficult to find, as the talented individuals, who ten years ago would have creatively engineered an in-house solution to a business need – are now working with Cloud providers, creatively implementing cloud-based solutions for the broader corporate marketplace.
All in-house systems come at a cost. Upfront hardware and software costs, equipment depreciation, equipment service and replacement costs, lost productivity in end-user training to utilize your specialized systems, infrastructure costs such as electricity, air conditioning, internet access – to keep all the systems up and running, and others – it goes on and on. In sum, owning your own equipment is a huge expense for your business. By making a move toward the Cloud, your business benefits from the investment; the creative implementations of solutions, and cost savings derived from the economies of scale that cloud providers enjoy and are able to pass on to your business.
The Costs of Retaining Systems In-House:
Cloud Computing service offerings are usually based upon a simple flat rate – a monthly per-user fee is typical for most billing arrangements. To draw a comparison, we will use a hypothetical company with 1000 employees requiring advanced email service such as Microsoft Exchange. The company has a choice – they can utilize an in-house solution, or find a Cloud-Based provider that can do it cheaper, better, and deploy the entire service instantly.
If our hypothetical company chose to build the infrastructure in-house, our company would require a physical server – roughly $3000 to purchase the bare minimum of hardware necessary to make the system work. On top of this server, software costs would come into play – you would require a server operating system. Currently, Microsoft charges $1029 for a version of Windows Server 2008 R2, which includes only 5 Client Access Licenses. To get the thousand client access licenses necessary, the cost shoots to $39,950. Our running total so far is $43,979.
We still need to cover the personnel costs involved and we still need to configure the software with the Exchange Server software, a separate cost of $629. A separate set of Client Access Licenses is also required for Exchange Server at a cost of $67 per user – totaling $67,000. Our running tally so far? $111,608. Microsoft’s antivirus solution for Microsoft Exchange server, Forefront Online Protection for Exchange, is priced at $15 per user for a total outlay of $15,000 additional. Total outlay: $126,608. Utilizing the industry standard Symantec Backup Exec for your backup solution yields an additional cost of $1,162 for a single license for the server environment. Total tally? $127,770.
This scenario does not even address the personnel costs and ongoing maintenance for the system – just the immediate upfront costs for building a Microsoft Exchange system in-house at current licensing fees. By means of contrast, an outsourced solution with per user costs of $9.99 per month will result in a monthly fee of $9,990.00 for the users, for a yearly fee of $119,880. Just the upfront costs of a server alone cost more than a year of service with a leading Hosted Exchange Cloud provider.
The Cloud: Pre-built Infrastructure for your Business
Imagine trying to build a power-plant for generating electricity for your business. It makes no sense to generate your own electricity if you can just buy electricity from the grid. This is, in effect, what the Cloud offers your business: enterprise class infrastructure – already built for your company. Cloud service providers are able to field systems managed by experts in their field, and focus on providing the very product you are utilizing, plus offer the highest levels of support.
Cloud Providers are experts in their respective service offering. A provider that focuses on specific service will invariably gain expertise in the underlying platform that would be impossible for companies with other business models to obtain. Regardless of how well financed your in-house IT team is, they will be unable to obtain the same breadth of experience that a Cloud provider can offer unless you are part of a multinational company, upwards of 10,000 users – the only sorts of organizations large enough to retain and maintain a competent in-house IT staff with requisite experts in their fields.
Despite many of the benefits, Cloud Computing solutions are not for every company. Using the Microsoft Exchange hosting model and scenario discussed above, the cost benefits for going with a Cloud Email provider that offers Exchange Server disappear if more than roughly 5,000 users are needed on the same system. A large enterprise may also obtain other cost savings realized through creative implementation of large systems – but the costs of these systems – both upfront, and on an ongoing basis greatly exceed those that would be paid to a Cloud-based hosting provider unless the operation is sufficiently large to offset the ‘economies of scale’ that Cloud offerings are able to leverage.
Vetting Cloud Providers – Are They The Best Fit for your Business?
Most Cloud SaaS businesses will obtain necessary quality certifications for their internal systems. It is a good practice to ensure that the company has met a minimum quality standard. A current SAS-70 Audit will ensure the company’s processes and access control systems are appropriate for a business of the type that you intend to entrust your data to. Certifications as it pertains to operating standards for SaaS companies are critical to assessing the quality of a prospective provider. Without the necessary internal processes in place to ensure that you data is secure, and that the system is up and operational at all times.
Another important area to inspect when signing on to Cloud based SaaS companies is the SLA, or Service Level Agreement. The SLA defines in legal terms what sorts of uptime guarantees are made by the provider, and by agreeing to service, your legal rights are defined within the SLA. It would be good practice to review the SLA of any prospective SaaS provider you plan to do business with.
Cloud Computing has matured to a point that it can replace almost every in-house system. Essentially, business telecommunications can now be outsourced, and the exorbitant costs to house the in-house telecommunications equipment can be done away with.
Predicting the Costs of the Cloud:
Another significant advantage that businesses obtain with Cloud-based solutions is the ability to predict the cost in advance. Existing in-house systems are unwieldy by design, and an unexpected systems failure can result in shooting over budget with additional equipment, software, and licensing fees. With Cloud-Based systems, the only cost you need to know is the monthly fee.
To recap, when utilizing a Cloud based system, you enjoy significant cost savings, and an internal pool of talent that is able to address any issue that may occur with the system quickly and efficiently. In larger organizations with in-house systems, members of the IT team float around between different systems, often times never turning into an expert on the system, and not utilizing it to its full potential. When working with Cloud providers, the provider you are working with is an expert – it is their business to be an expert in the product they offer, and the expertise that works on the systems ensures that best practices will be adhered to.
Companies operating in the Cloud space are also aware that their business depends on perception, and service offered. Service outages are unacceptable, problems and issues need to be rectified immediately. Perception is key to their continued success – which is why Cloud-based offerings will have certifications along the lines of SAS-70. In the event of a service interruption, major damage can result to the company’s brand and image.
In sum, cloud computing offers a number of significant advances in functionality, and allows companies to streamline and better predict their costs. Deployment of systems is instantaneous, service is top tier, and you are working with experts who live and breathe the product that your business utilizes. Adoption of Cloud-based systems gives your company a competitive advantage.
Copyright © Daniel J. Serri, All Rights Reserved. July 17, 2011
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