Cloud Computing 16 Dec 2011
More for less from the clouds...
There has been a lot of talk around town lately about cloud computing. The information technology (IT) world is offering lower costs and greater efficiency if we adopt new technology. We have been here before! Pie in the sky? Not in this case if decision-makers make the correct call.
For those of you who aren't sure what this is; Cloud computing is the delivery of computing as a service rather than a product. It's when shared resources are provided to computers over the Internet rather than having the software installed on your computer.
How does this relate to us in Marlborough?
Dominant accounting software providers such as MYOB, QuickBooks and Xero all have a 'Cloud' based option which the Marlborough business owner needs to be aware of, as a possibility for the business to reduce costs. Likewise Microsoft offers a complete and price competitive cloud based alternative to the PC based Microsoft Office suite.
Cloud computing will also change for the better how accounting services are delivered to a business. The nature of the service provided by the existing IT consultant will also change.
The majority of businesses in Marlborough currently use a well-established IT model being; an in-house server connected to say 5-15 personal computers of some sort, nearly exclusively using Microsoft software, and connected to the internet via broadband.
Accounting packages from MYOB and QuickBooks are common. The business relies on external IT consultants to maintain the in-house network. The business is stuck on an IT treadmill as the hardware and software is replaced every 4-5 years. All up a $50K overhead over 5 years is commonplace. A grudge purchase.
In contrast, cloud based computing means a business can access accounting and business records from, effectively, any internet connection. No need to buy software or spend money on expensive high spec in-house hardware. Sounds too good to be true, particularly if a business owner suspects their internet connection is a bit dodgy.
A pattern is already emerging from Marlborough based business owners who have adopted some form of cloud based services. Not surprising they are motivated by achieving more from their IT cost rather than seeking the promised cost saving.
Planning the transition to cloud based computing is paramount as there is a very real risk of a business owner adopting some cloud based services and leaving intact the established in-house network. Outcome; two systems, another layer of complexity, more overheads, and a frustrated business owner. Just don't go there.
Understanding and timing is everything to unlocking the cost savings. Before a business next upgrades the accounting package or replaces the in-house hardware then step one is, hurry up and wait. Yes, stop and ask those that should know, is there a more cost effective approach for my business?
More for less, at an acceptable risk, is available with the right advice.
Peter Tolan, Director - TvA Lock Limited, Chartered Accountants
Article from Marlborough Chamber of Commerce Newsletter Summer 2011
