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Private cloud: can it really accelerate business efficiency?

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Why private clouds could be a better way of doing business

Few cloud computing disadvantages


It’s taken as understood that enterprises throughout the world are turning to cloud. There’s plenty of choice for organisations – some are turning to public cloud services while others opt for a private offering.

There are well-rehearsed advantages in opting for public cloud – lower capital costs, flexibility etc – but what are the main drivers for private cloud and how can your choice help your company become more efficient.

Business efficiency is a double-edged phrase: does it mean that your processes have become sharper and you’re seeking to gain added advantage or does it mean, as it often does, you’ve reduced your cost base and have become more profitable

Financial benefits

Business cloud storageIntroducing private cloud is one of the examples where both apply. There may be an initial capital outlay but companies who go down the private cloud route will draw financial benefits over the lifetime of the servers.

According to research from Forrester, there are savings in many areas: IT support, hardware savings, security provision and in less downtime.  One of the big efficiencies is in server consolidation, Forrester claims that average enterprises can lop $1, 291, 240 off running costs over three years.  It’s true that much of that will be due to consolidation and virtualisation but there are additional savings for operational efficiencies. Tied in with this are savings of $2,324,000 over three years on networking and storage.

There are some economies in personnel too. One of the merits of moving to a cloud-based system is that security is handled better – Forrester calculates that there’s a saving in staff costs of between 5 and 10 percent a year. There’s clearly less maintenance to do and there should be less downtime as a result. The research company also claims that companies can save many thousands of dollars in adhering to demands on compliance and from any legal consequences of a security breach – although after the passing of the EU General Data Protection Regulation that should be millions of dollars for companies based in Europe.

Better procedures

What’s much harder to quantify are the sort of savings that accrue from being better organised across the enterprise. By implementing a cloud system, a company will generally benefit from a more flexible way of working – this could be by not being tied to a physical location or by better collaboration across departments.

What’s much harder is to put a figure on these improvements – they’re often subjective and hard to quantify. In its research, Forrester puts a figure of 4 percent of productivity improvements but this is something that is going to widely vary.

Good planning

This last figure demonstrates that it’s not always about technology. Successful implementation of a cloud strategy is not just a question of ripping out existing equipment and starting again. It means planning carefully – involving all parties from the outset – and working out what’s right for the business and not trying to crowbar products into a company that’s not designed to work that way.

Cloud can offer a host of operational efficiencies – both in terms of cost and personnel – but the business must be ready for a technological change or the move will not provide all the desired improvements.

Click here to read more on the efficiency of private clouds.


Maxwell Cooter

Maxwell Cooter

Max is a freelance journalist who has covered a wide variety of IT subjects. He was the founder editor of Cloud Pro, one of the first dedicated cloud publications. He also founded and edited IDG's Techworld and prior to that was editor of Network Week. As a freelancer, he has contributed to IDG Direct, SC Magazine, Computer Weekly, Computer Reseller News, Internet magazine, PC Business World and many others. He has also spoken at many conferences and has been a commentator for the BBC, ITN and computer TV channel CNBC.

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Tags: Cloud Computing, Technology