Operations Management Articles

Why Cloud Computing Is a Safe Bet for Small Businesses

by Michele Nachum
Published on 12 July 2011

Cloud computing, which in the broadest of terms means solutions and services delivered via the Internet, is more than just a popular catch phrase these days - it has literally changed the way we all do "IT." That said the issues around security in the cloud have proliferated as many wonder if cloud computing is actually safe for storing proprietary information. These issues are particularly worrisome when a major technology company, let's say Google, gets hacked and the thought of all that data floating around in the cloud at the disposal of sophisticated hackers unleashing malware, Trojans, botnets is a bit unnerving to say the least.

The good news is that the incidents of cloud breaches are more the exception than the rule. And that is a blessing. After all, cloud computing has been especially kind to small and medium sized businesses (SMBs) as it has made technology that was once deemed suitable only for enterprises with massive server space and deep pockets available to nearly any size business with any size budget.

In addition, having services and information hosted in the cloud can actually be a safer bet for an SMB. For example, storing information on remote servers via a third party can be generally more secure than hosting the data locally - especially for SMBs that have small or limited IT staff and equipment. Why? Because these cloud computing technology providers generally have strict security protocols, APIs and personnel in place to protect the information, ward off potential viruses and malware as well as back-up solutions in case of a natural disaster.

Take Okta, an on-demand identity management solution, for instance. This solution offers small businesses the opportunity to log into all of their web-based applications with a single password. However, Okta is not just offering a simpler way to log into multiple online products, but it ensures its users a certain level of security that might not be present otherwise.

As such, people are buying and signing up for cloud-based software and services more than ever these days and the numbers prove it. According to IDC "…worldwide revenue from public IT cloud services exceeded $16 billion in 2009 and is forecast to reach $55.5 billion in 2014."

Even the stalwart Cloud Security Alliance, noted that customers today are very excited by the possibilities of the cloud, including "…the opportunities to reduce capital costs…to divest themselves of infrastructure management, and focus on core competencies. Most of all, (customers) are excited by the… ability to align information technology with business strategies and needs more readily."

However, even with all this excitement and starry-eyed optimism - an SMB should never be complacent about cloud security. Experts warn that anytime an SMB is about to sign on with a cloud computing solution provider, it is up to the business to make sure that the provider will protect their private and valuable data.

Here are some points to consider and questions to ask when moving to the cloud:

  1. Do the Research: Vendors are businesses too and want their customers to know they are trustworthy. Therefore, look online - are there any reviews or blogs that talk about the product or service? Is the vendor listed in organizations like the Better Business Bureau? Ask your vendor for references and talk to their other customers as well.
  2. Security Policy : Ask your provider how they secure your mission-critical information and protect against leaks, viruses, and fraud. A good third party provider will have a staunch statement of security and excellent back-up plan.
  3. Liability Policy: Make sure you understand who is liable in case of an information breach or leak. According to Smallbusinesscomputing.com, "If the information leaked is proprietary only to your company, liability is not a concern. But you need to know where responsibility lies if customer or patient information goes missing".
  4. Who is minding the store? The Cloud Security Alliance notes that people as well as machines are guarding your proprietary data. Make sure you understand the provider's hiring policies - how do they ensure their own personnel are trustworthy and will not leak out private information.
  5. Credit Card Protection: If your cloud computing service involves e-commerce where credit card numbers from customers are entered, make sure you understand how the supplier secures the credit card data and how the information is monitored and secured.
  6. Legalities of Information in the Cloud: Make sure you know whether the data you want to store in the cloud is in synch with the laws of your country or industry as some health or legal information may not be allowed to be hosted online. In that case, you may opt for a hybrid solution - where some of the data is stored locally and some in the cloud.

The upshot, if you manage or own a small business, cloud computing can be a life-saver. Most cloud-based products and solutions are safe, and with a little work upfront, you can verify if a vendor is right for you as well as provides the right amount of security for your peace-of-mind. Using a cloud computing vendor to help you manage your business is a good solution financially as well as offers all of your employees anytime access to their applications as long as they have a an internet connection and a password. In a nutshell, SMBs cannot go wrong as long as they are smart about choosing the top solution providers - so go ahead and reach for the sky - the cloud is where you should be.


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