5 SMB Pros and Cons for the Cloud

You take the good, you take the bad, you take them both and there you have, the facts of life. The feeling of nostalgia for that staple of 1980s television The Facts of Life notwithstanding, the good and the bad can be applied to that ever-expanding network we call the Cloud. At an event hosted by Rackspace, your intrepid blogger was brought up to speed on recent developments and how the company is working toward its corporate goal of being “The preeminent IT services company in the world”.  The cloud is the primary focus of Rackspace and numerous competing companies all over the world. There are challenges to face but also opportunities to seize. Let’s look at the challenges that Rackspace identified with the cloud and then put an SMB focused lens on reasons for subscribing or not subscribing to cloud solutions.

All data equal?
SMBs are putting data on the cloud

Top Challenges

The topics on analyst day covered all facets of the Rackspace portfolio and numerous employees shared their subject matter expertise. Additionally, several customers shared stories about their transformation with Rackspace and how their business has changed over the years. The cloud presents both an opportunity to customers as well a challenge and we’ll see that difference in position can be a matter of perspective.

Rackspace has identified 8 top cloud challenges

These cloud challenges are commonplace but nothing is ordinary about the implication they have on a business. AMI has gathered intelligence on why SMBs are using the cloud and reasons why they are not using it. Perception is key and money spent as an investment by one SMB can be too much of an upfront cost to shoulder for another.

The Cloud Conundrum – The Pros

When it comes to reasons for using the cloud, money tops the list. Namely, saving it. The shift from on-premise to cloud allows SMBs to save on deployment. Instead of relying on internally owned computers and servers to access software, an SMB on the cloud will leverage a vendor’s servers for access. The reduction in infrastructure saves capital resources and by having support handled by the vendor, an SMB can better focus on its core competencies. Additionally, with data now accessible from virtually any connected device, employees can retrieve information outside the confines of the office. This can allow for remote work sessions while on business travel or even a reduction in physical office time as more tasks could be done without commuting to the office. The cloud has enabled a new workforce structure and the dynamics are changing as rapidly as the technology is advancing.

AMI-Partners Market Intelligence on SMBs in the Cloud
SMBs enjoy cost savings and greater flexibility with the cloud

The Cloud Conundrum – The Cons

Now it’s time to take the bad… Not everyone is currently open to floating on the cloud. Just like money was at the forefront of reasoning for the Pros of Cloud, money takes centerstage for the Cons of Cloud. Namely, spending it. Switching from an on-premise to cloud solution requires spending to replace something an SMB already has in place. The mantra of “If it ain’t broke, don’t fix it” applies here for many SMBs. Of course, horse and buggies would be much more prevalent today had the likes of de Rivaz, Marcus, Otto, Diesel, Schonbein, Jedlik, Plante, Benz, Ford and other pioneers & contributors of horseless carriage locomotion believed that refrain.

AMI-Partners knows why SMBs are not using the cloud
SMBs are concerned about the cost of switching and technical challenges

With any new solution, there is a learning curve and period of adjustment. SMBs point out their lack of technical expertise and the need to train employees on a new system for top reasons to stick to an on-premise solution. While valid points, the reality of the times dictate that the horse and buggy are reserved for a micro-slice of the population and automobiles dominate the roads of the world. In time, the migration from on-premise to cloud will result in cloud solutions becoming ubiquitous across the SMB space. Finding an on-premise solution could prove as challenging as finding a good repair shop to service your barouche.

Looking Ahead

Companies such as Rackspace continue to make improvements. The analyst day at the Conrad hotel in New York showcased the many offerings it has in place and the trajectory the company hopes to follow moving forward. That path is the cloud and a major subset of users there are found in the SMB space. By listening to what customers need and providing solutions that alleviate concerns, Rackspace and numerous other companies focusing on cloud solutions can realize the benefits of being in tune with the SMB space.

Andrew Svonavec | Associate

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