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Cloud Computing: does it make sense to SMEs?

by Administrator
Jimson Olufuye Adrian Schofield Issue:Africa and the Middle East 2014
Article no.:6
Topic:Cloud Computing: does it make sense to SMEs?
Author:Jimson Olufuye & Adrian Schofield
Title:Chairman & CEO/ & Vice-Chair
Organisation:Africa Information & Communications Technologies Alliance (AfICTA)
PDF size:206KB

About author

Dr Jimson Olufuye, FNCS, FICMA, PRINCE2, PhD
Jimson is the Chair and CEO of the Africa Information & Communications Technologies Alliance (AfICTA) and CEO of Kontemporary, a leading Nigerian technology company. AfICTA is a business-led grouping of African industry associations and enterprises, promoting the value of technology in growing the continent’s economies and supporting social development. Jimson serves on numerous regional and global committees.
_________________________________________________________________________
Adrian Schofield, FIITPSA, PMIITPSA
Adrian is the Vice-Chair of AfICTA and is Manager of Applied Research at the Joburg Centre for Software Engineering at the University of Witwatersrand in South Africa. Adrian is the immediate Past President and a current director of the Institute of Information Technology Professionals South Africa (IITPSA

Article abstract

Cloud computing offers great value to enterprises of all sizes. Real case studies are available to illustrate the successes and the challenges that have to be overcome on the road to success.
Pertinent to the value of cloud solutions, particularly for SMEs in the African environment, is the connection. Mobile phones have a high penetration rate but the reliability and affordability of the connection to the network may hinder the use of devices for more than voice and messaging purposes. Business cannot afford to be put at risk of broken connections and lost data, the threats of which negate the potential value of utilising the ‘Cloud’. Real broadband is a ‘must’.
The potential of ‘Cloud’, for economic growth and social development in Africa, makes it essential for industry and governments to join togther in hastening the rollout of communications infrastructure across the continent.

Full Article

l Terminology versus technology
The vendor community in the ‘ICT’ sector loves to create new names to describe ‘new’ solutions. Sometimes, those solutions are not so new, nor even a measurable improvement on the ‘old’ version. Sometimes, the words used to describe the new technology make more sense to the vendors than to the users, who become confused about whether they are buying the terminology rather than the technology.
‘Cloud Computing’ is a good example. The use of ‘cloud’ as a descriptor related to remote computing goes back many years, to an era when Data Processing Managers and (copper wire) telecommunications experts were the only people required to understand how it was possible for a remote mainframe to service local terminals.
Now, the sellers of digital technology use the term ‘cloud’ to cover the provision of computing-related services to end users who must be connected to a network, in order to activate and benefit from those services. Buyers can choose from Platform as a Service, Network as a Service, Infrastructure as a Service, Software as a Service – everything as a Service!
A study carried out by the Joburg Centre for Software Engineering at the University of Witwatersrand in 2013 (Schofield A, Dwolatzky B, Lewis C: Research Study on the Economic Impact of Cloud Services on South African SMMEs: 2013) posed the question whether small business decision makers were aware of ‘cloud’ and whether it mattered to them.
l Practical application of Cloud for SMEs
We hardly need ask what the priorities of a small business are – (or any business, for that matter). The generation of income comes way in front of the administration of the business. But even the smallest business needs tools to accomplish the necessary accounting, reporting and tracking functions. Managers and staff need connectivity for communications, storage for records, and applications for documentation, calculation and analysis.
The transition from manual or analogue to digital systems is a function of the ability of the users to benefit from the technology (a matter of skills and confidence) and of the decision-maker’s competence to extract the desired productivity improvement. Unlike the process in a major enterprise, where such transitions are analysed and managed in detail, small businesses are more likely to make a judgement based on hearsay, perception or recommendation, without realising the technological basis for the solution chosen.
Acquisition of a truck allows the business to have access to the highway system, to collect materials and deliver products. The truck can be bought or leased, the roads chosen can be tolled or toll-free. Licensing and insurance can be compliant, the driver can be trained, the vehicle can be maintained. (Note the use of the word ‘can’ rather than ‘must’ to indicate the risk inherent in not achieving these standards.) Or, the whole transport issue could be outsourced to a courier or distribution company.
Similarly, the business can acquire its administrative technology by purchasing and managing computers, mobile devices, software, network access, data storage and backup, or it can look to service providers who can supply applications, connection, mobility, backup and security through a choice of end-user devices. Does it matter to the business whether it is Nokia or Samsung, Windows or Linux, Vodafone or Oger? Probably not more than if the truck is a Ford or a Fuso. The technology must work, be reliable and affordable.
l Real cloud issues
Pertinent to the value of cloud solutions, particularly for small and medium enterprises in the African environment, is the connection. Mobile phones have a high penetration rate but the reliability and affordability of the connection to the network may hinder the use of the devices for more than voice and messaging purposes. Business cannot afford to be put at risk of broken connections and lost data, the threats of which negate the potential value of utilising the ‘cloud’. Real broadband is a ‘must.’.
Where there is a good connection, the small business must then concern itself with data privacy, both its own and the data it holds about its customers, staff and suppliers. Increasingly, nations demand protection of data from theft or accidental loss, sometimes to the extent of requiring it to be stored “in country” and not on servers beyond the national borders. Data must also be protected from corruption by malware and capable of restoration in the event of failure.
The business owner who is convinced of the potential of ‘cloud’ must then decide on a suitable vendor and work out the cost of the service, compared to the existing computer support of the operation. As suggested in the opening remarks, the terminology may cloud the issue (pardon the pun) by making it difficult to compare like with like – whether between vendor choices or against the current system. The existence of cloud service brokers in this relatively new marketplace is indicative of the complexity that exists in identifying appropriate solutions.
The next issue facing the decision-maker is that of skill. In making the transition to cloud services, what new skills will be required of the end-users and systems administrators? In many cases, end users may notice little difference but a significantly different philosophy will need to be understood by the systems management and support staff.
Finally, there remains the decision about which of the available services are suitable for movement out of the hands of the enterprise and into the cloud. The choice runs the gamut of email, messaging, data storage & backup, CRM, web hosting, admin systems, e-commerce, and more.
l Cloud risks and rewards
There is sufficient evidence of the value that cloud computing offers to all sizes of enterprise that it warrants serious consideration by business owners. Real case studies are available to illustrate the successes and the challenges that have to be overcome on the road to success.
Outsourcing of non-core operations to specialists allows the enterprise managers to focus on core business issues and it makes no difference if those operations are transport, accounting or digital technology. The risk is having an inadequate service level agreement that fails to protect the buyer from shortcomings on the part of the vendor, or of having lock-in through the use of proprietary data formats, but these are resolvable issues.
The introduction of cloud services to the enterprise is also subject to policy and regulatory considerations. The potential user must ensure that the solution is compliant with local requirements for record-keeping, privacy protection and data integrity.
l Commoditisation
This final point could be called ‘technology versus terminology’ in juxtaposition to the opening remarks. Increasingly, small and medium enterprises are no longer concerned with the nuts and bolts of the digital technology they use. Managers do not have to think in terms of voice, video or data, nor about wired or wireless.
The services that support business operations are off-the-shelf commodities. The growing range of service providers are becoming one-stop shops, supplying the devices, the network and the applications.
The enabling factor that this represents for economic growth and social development in Africa makes it essential for industry and governments to link hands is hastening the rollout of communications infrastructure across the continent.

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