Cloud computing in need of wider adoption from SMEs

Cloud computing in need of wider adoption from SMEs

Small to medium-sized enterprises (SMEs) are lagging behind their larger corporate rivals by not adopting a cloud system.

A recent report by the Centre for Economic and Business Research (CEBR), claims that SMEs in Europe are therefore putting themselves at a disadvantage.

It uses the example of e-commerce to demonstrate how larger companies are gaining a better foothold in the online market.

The research shows that SMEs in the UK saw productivity decline by 1.7 per cent more than their larger counterparts, a situation that the CEBR claims can be resolved through using cloud computing.

It claims that an effective cloud solution can address this gap in productivity by allowing SMEs the chance to manage their IT capacity in a way that makes it respond to changes in the market, while also improving the experiences of customers.

The elastic scalability offered by cloud computing means that SMEs are in a better position to manage seasonal peaks, which can then cause an increase in output and enhance productivity.

Expenditures traditionally spent on IT staff, maintenance and hardware would also be reduced, allowing SMEs to stay within their financial means, something which become a heightened concern since the beginning of the financial crisis.

The report estimates that the implementation of a private cloud environment would lead to reductions of around 17.3 per cent in total expenditure, while a public cloud system would cut the figure by as much as 39.9 per cent.

The fact that it can also eliminate the need for IT staff offering constant maintenance also means that they can be deployed to more effective, and productive areas of the organisation.

More money is saved by the fact that there is a reduced need to for power and cooling, which in a private cloud system could save as much as 44 per cent.

Not only can cloud computing benefit existing companies though, it can also offer a helping hand to those yet to be established.

The CEBR report suggested that because of the benefits lowering previous barriers preventing many businesses from starting out, around 35,000 new SMEs could soon be formed by 2015.