SMBs Benefiting from the Cloud

For some time, obtaining high-end technology has been out of reach for small-to-midsize businesses. Those types of advancements were earmarked for enterprise and the larger brands. However like everything else in the IT world, higher levels of sophistication at affordable prices eventually become obtainable for smaller end users.

For example, virtualization [that today can come part and parcel with your cloud computing package] isn’t a technology that SMB owners need to know a lot about – suffice to say, it will provide efficiencies and capabilities far greater than what cloud computing was offering a few years back.

Different Needs

The needs and preference of smaller users are radically different from larger brands. So much so, that cloud providers who have assessed this differences have become proactive in working with and addressing the needs of SMBs.

This is self-evident in the Voice over Internet Protocol (VoIP) space, where companies like Telzio has catered to an SMB clientele base for years.

According to Telzio’s chief executive officer, Peter Rank Schrøder, he asserts that his cloud-based VoIP service has kept up with the times to address the needs of this specific end user.

Schrøder believes there’s a major difference between VoIP companies that are cloud based and those, which are not. He states, “Mainly, because the technology progresses so fast, that the hardware system these providers bought 5 years ago, are far behind the capabilities of what we can do with 100% software based systems today. Their big problem is, that they are locked in to 10 year license agreements with the hardware system vendors, so they can’t just migrate to an all cloud based solution from one day to another.”

Schrøder notes that:

Telzio is a lot more nimble when it comes to innovation. That’s what gives us a huge advantage, and allows us to provide superior quality with a price lower than our competitors.

Simplicity

Tom Stachowiak, the CTO of Birch Communications, says that SMBs are more receptive of cloud capabilities after a false start several years ago.

The key is simplicity, Stachowiak notes. Enterprise hires experts to attend to these IT issues. For them, the relationship between the cloud provider and their IT leaders is one of equals. That usually isn’t the case when the SMB is the customer.

Instead, with SMBs, it’s more of a vendor-as-consultant relationship. The SMB owner learns what the cloud will offer his company and then decides if it is or is not a fit. However, for them, they are not as well versed regarding the intricacies and nuances of how it all works — or cares.

Most often SMBs are focused on a single package where pricing is simple and straightforward. For instance, in the case of Telzio’s VoIP service, their cloud-based package is based on a monthly subscription fee, which starts as low as $1 per month.

Granted, while this fee only addresses one service required by an SMB, it serves as an example that when SMBs are in the market for other services, they should consider looking for 3rd party providers who are also cloud-based and cost-efficient.

Deloitte Commissioned by Google

Deloitte was commissioned by Google in 2014 to present their findings on “How the cloud enables rapid growth in SMBs.” They conducted interviews with over 35 small and medium business IT decision makers – typically Founder, CFOs, CIOs, IT Director roles – in the UK, US and the Netherlands.

Their findings showed that SMBs using cloud technology grew 26% faster and delivered 21% higher gross profits.

Deloitte found that SMB owners and their staffs did not need any special skills to jump into cloud computing, even as a start-up.

It was noted: “None of their principles for success require specialist knowledge. They [cloud computing service providers] are grounded on excellent business sense and can therefore be readily applied to any business that is seeking to overcome typical business challenges and achieve growth.”

In fact, the report concluded that SMBs embracing cloud computing outperformed in a number of areas including sales and marketing than those who were slower adopters.

Economic Advantage

Economic benefit comes hand-in-hand with this technology. Like the Telzio example, cloud technologies are standardized IT services and solutions (infrastructure, platforms and software), which are managed and maintained by a 3rd party, and then delivered to consumers over a network connection and paid by one flat subscription amount, or based on usage.

Cloud services are most popular as substitutes for expensive infrastructure, such as document storage and disaster recovery. However, some more advanced SMBs are also using the reduced cost and complexity of tools such as Salesforce.com versus on‑premise equivalents to improve productivity in business functions at an earlier stage, than would have been possible only five years ago.

In fact, as my previous blog, “Microsoft’s LinkedIn Acquisition Good For SMBs” pointed out, Microsoft’s recent acquisition of LinkedIn is now a competitor of Salesforce, presenting yet another option for SMBs to improve productivity through a 3rd party cloud computing service.


Final Thoughts

As noted, cloud models are often on a subscription basis as in the Telzio example. If you were to compare this benefit with the hidden cost of operating your own technology environment [such as hardware, data-center, tech staff, updates, backup, monitoring and patching] you would soon realize that 3rd party cloud providers in most instances will provide a higher level and more secure service at exceeding low costs. For those SMB owners that jump in at this juncture, it might be the wisest move they’ve made for their company, since they started it.

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Ron is part of the marketing team at Telzio, covering everything from tips and tech for growing businesses to customer success stories for the Telzio blog. Previously a Director of Advertising and Public Relations at Marriott International, Ron has published several books including the award-winning graphic novel Facebucks.