You’ve probably read many success stories about SMEs who have used the cloud and have significantly cut costs. In fact, Nucleus Research analysed 70 case studies of businesses adopting SaaS and found that the ROI of these services was 1.7 times better than that of on-premises apps, mainly because hosted services offer greater benefits in the long run without a significant increase in costs.
When looking into switching to the cloud, you’re probably more interested to know about the costs and benefits so you can ensure that the shift pays off. You can find tens of articles online about the cloud being affordable and how you can save money using it, about the “pay-as-you-go” policy with low monthly fees, about dramatically reducing software and other costs. This is all true but is saving money the right measure of success?
Saving money vs. gaining value
When it comes to the cloud, it’s difficult to calculate ROI and see exactly how much money you’ve saved the company. But is ROI the best measure for cloud computing success? How about value?
Isn’t the cloud more about the outcomes and whether your customers are getting more value thanks to your shift to the cloud? Sure, one of the outcomes of using the cloud is a positive ROI. However, if cutting costs is the most important reason for switching to the cloud, you might be disappointed.
In fact, according to a study conducted by TNS, a market research firm, about a quarter of organisations from the United States, England, France, Germany, Brazil, Australia, Japan and Singapore reported no savings with cloud computing and about 35 percent saved less than $20,000.
So, instead of focusing on saving thousands of pounds, focus on value, whatever form it takes. Find out if you customers are happier with your service after you’ve switched to the cloud.
Price vs. performance
An easy way to measure value is to ask yourself if the price you’re paying is proportional to the outcomes that the cloud provides. For example, if you’re using a cloud-based collaboration app, is your team more productive now? Are they better organised and more efficient? Are they working better together and getting the best possible results?
Focus on outcomes, not ROI
If you’re considering switching to the cloud, whatever your reasons are, ask yourself this: what are you expecting to achieve out of using the cloud? Make sure you establish your outcomes from the very beginning. Here’s a few examples:
• Increased collaboration and productivity among the members of your team
• More agility and performance in provisioning application development platforms
• Reduced energy use.
Whatever you want your outcomes to be, make sure you also choose a cloud provider that is keen on helping you achieve these outcomes and not just offering a subscription.
Providing value = customer satisfaction
There’s a lot of value in using cloud computing. Giving your customers more choices and more performance can be exactly what they need. Plus, if the cloud can make your IT department more efficient and more responsive to helping customers get what they need and quicker, then that’s value. And if your customers start seeing your service as extremely valuable, then loyalty and conversion should increase. If you focus on value and customer satisfaction, switching to the cloud will definitely pay off.
About the Author: Article written by Alex Gavril who is part of the 123-reg cloud server hosting blogging team.
License: Image author owned