While IT professionals around the world are embracing cloud computing, many executives are taking a wider view of their businesses to determine whether the freedom of cloud-based functionality can extend beyond the realm of information technology and into other business functions.
Cloud-based computing is pretty simple to the lay person; using word processing, spreadsheet, or e-mail programs that are installed somewhere other than on the computer upon which you are currently typing. Simply put, the applications live “in a cloud” on the Internet rather than being installed on your computer hard drive. This approach frees you from having to continually update the programs yourself. It also stores your information in a place that makes it more secure than having it saved only on your computer. And, as anyone who uses cloud-based tools everyday knows; it’s completely scalable. It’s big when you need it, and it’s small when you don’t. Moreover, it has reduced the cost of computing to virtually (no pun intended) nothing.
Less is more. Systems are stored in one hub or ‘cloud’ not connected to outside networks, reducing cost and increasing security and efficiency. R&D investment, excess capacity is shared; the highest level professionals work behind the scenes wherever they are needed, but you only pay for what you need and what you actually use. Some great examples that make it easy for us all everyday: Gmail, Amazon, Google apps, Salesforce and Windows Azure.
In more professional parlance, cloud computing combines virtualization with other technologies to provide dynamic scalability and agility. Applications can run on private clouds (on premises), on public clouds (off premises) or both (hybrid clouds). The concept generally incorporates combinations of Infrastructure as a Service (IaaS), Platform as a Service (PaaS), or Software as a Service (SaaS). The benefits of cloud computing are defined as leveraging economies of scale in computing. This makes a lot of sense. Rather than build your infrastructure one hardware server at a time, you can leverage a pool of resources (e.g., networks, servers, storage, applications, and services) to maximize efficiency and lower your overall operating costs.
The benefits are easily identifiable in the IT world:
1) Lower Costs. Cloud computing pools all of the computing resources that can be distributed to applications as needed.
2) Cap-Ex Free Computing. Cloud computing delivers a better cash flow by eliminating the capital expense associated with building a server infrastructure.
3) Deploy Projects Faster. Because server capacity can be launched and shuttered in a matter of minutes, the time to deploy a new application drops dramatically.
4) Scale as Needed. As your applications grow, you can add capacity; meaning you can buy “just enough” and scale as the application demands grow.
5) Lower Maintenance Costs. With an outsourced cloud, you don’t need to keep server, storage, network, and virtualization experts on staff full time. You get economies of scale of those expert resources through your cloud provider.
6) Resiliency and Redundancy. Cloud deployment provides automatic failover and immediate disaster recovery services.
Now, some companies are applying the same concepts to non-IT functions; even something as asset heavy as warehousing and transportation.
At CaseStack, we have collaboratively built a transportation and warehousing model to enable customers to use services as needed without investing in buildings or trucks; almost as though their logistics services were handled in the cloud. Many of CaseStack’s key business partners could easily be misconstrued as competitors, but they are actually its closest allies. CaseStack’s most-important service platforms have been developed with very large retailers who are not customers, vendors, or even partners in a legally-documented sense; they are co-collaborators. Through collaboration, CaseStack is outgrowing the industry by focusing on collaboration instead of investing in heavy assets.