Small and medium enterprise?s (SME) adoption of cloud computing could slash IT spend cost and leave a lot of cash in hand for core operations of SMEs, says industry experts.
There around 25 million micro and small- and medium-enterprises and the cost of IT spend by the SMEs is close to $10 billion a year. Cloud computing for SMEs, in other words, ?pay as you use? model of IT infrastructure, could drastically reduce hidden cost on IT spend of SMEs as enterprises running on conventional IT delivery model incur about 60% to 75% of their IT spend on IT infrastructure maintenance.
?Pay as you use? model could save cost on hidden expenditure on IT infrastructure maintenance and mitigate the IT spend of enterprises, they said.
Pooventhan, regional head of Tata Consulting, said the present ?pay first, use later model? of IT adoption is leading to cost overheads in terms of maintenance. In the ?pay first use, later model? or the ?on-premise? model, customers are forced to pay for the cost of failed ICT deployment due to plethora of factors like lengthy implementation cycle, lack of integration across ICT system, lack of single accountable partners for ICT, lack of credible ICT solution increasing the risk of non-compliance, etc.? The cloud model for SMEs move the risk from consumer to producer’,? he said.
Venky Srinivasan, executive vice president at Take Solutions said SMEs? cloud adoption in a way is a kind of ?Blue Ocean? strategy for SME clients in leveraging advance potential of ICT for the greater success of their business. Listing out the various costs of on-premise IT, he said it includes development, licence cost, maintenance upgrade, patch fixing, quality analysis test cycles, tedious documentation in data backups, etc.
?Where as in cloud, the service provider takes care of the entire IT process providing the right IT infrastructure suiting the SME consumer needs. Small business houses could focus on their core businesses processes rather than worrying about the challenges of managing the IT,? he said.
Mani Doraiswami, CTO at Orangescape said cloud computing has democratised application development process. ?Distributor proprietary software model is no more valid in the transition from conventional to cloud-based delivery. Cloud ecosystem offers abundant opportunities to develop many user specific applications,? he said.
On the question of data security on cloud, Pooventhan said 80% of the data compromise happen within the organisation than at the cloud managed data centres.
?One should view cloud as a business model rather than a pure technology model. It is a ?fit for purpose? solution supporting the constantly evolving business process. There are various pricing models available to SME consumers depending upon the quantum and level of usage. It is possible follow-user based pricing, transaction- based pricing and concurrent-based pricing in SME adoption of cloud.?
