How Can You Unlock the Cost Benefits Of Cloud Computing? With the pay-as-you-go model and scalability of the cloud, one is typically billed on the usage of resources, which can scale up or down according to demand

By Anirudh Kala

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As more and more organizations are embracing cloud computing, one of the major driving factors behind this adoption is the proposed cost savings. The pandemic has resulted in furthering this adoption and driving accelerated digital transformation at enterprises. A study by NASSCOM on India's public cloud market reported a 15-20 per cent reduction in operational costs for SMEs in India along with a 20-25 per cent boost in productivity.

Let's take a look at how cloud computing can help you with cost reduction for your business. While going through the list, it is important to keep in mind that the cost impact varies for every organization depending on their IT objectives, current technology infrastructure, type of applications, etc., and that a proper IT strategy is crucial to realize the cost benefits of the cloud.

Flexible payment model

With the pay-as-you-go model and scalability of the cloud, you are typically billed on the usage of resources, which you can scale up or down according to their demand. This allows you to save on costs for under-utilized resources. Cloud also requires lower initial capital investment into software and licenses as the upfront cost of the cloud is less than in-house solutions. You are able to eliminate the costs of running data centres, maintenance, hardware replacement costs and power issues. With increased flexibility and mobility of the cloud, your employee productivity is enhanced, which further drives efficiency and growth.

Optimum energy usage

When your servers are running 24/7, your energy consumption costs can become outrageously high. Coupled with inefficient server utilization for in-house systems, your energy usage can lead to extortionate energy bills. Moving to the cloud means eliminating the need for an in-house data centre. With huge economies of scale and efficient power usage, cloud providers can charge you significantly less for the systems and resources utilized. It is challenging for in-house manpower to manage large scale operations with ease. Cloud providers with their purpose-built data centres, timely upgrades and optimum server utilization can help you save your time and money. Also, with no extra costs, all users can stay up to date with the system operations.

Accelerated business agility

Cloud presents an excellent platform for experimentation leading to faster innovation for your organization. The adoption of cloud computing promotes rapid advancement with the faster development of future products, solutions, business channels, models and resilient supply chains. Moreover, the cloud enables quicker, data-driven decision-making and business continuity, helping your organization become future-ready. All of this will propel business growth and lead to higher revenue for your enterprise. This will have a multiplier effect on your business and boost the overall cost-effectiveness.

Reduced capital expenditure

There is no requirement of any in-house infrastructure as the entire network and storage can be made accessible from cloud servers. You don't have to spend money purchasing licences for a limited period as the cloud providers will be responsible for allocating resources, both hardware and software that suit your company's needs. Furthermore, the cloud provides the ability to expand your resources in the future without additional cost in purchasing in-house equipment.

Enhanced productivity and efficiency

Cloud allows your employees to spend less time on deployment and more time working towards application development and new business initiatives. Your workforce can easily access applications, data and systems on the cloud from anywhere, enabling remote work. Cloud platforms also allow the processing of huge amounts of data and the application of advanced technologies such as artificial intelligence and machine learning. It is expensive and complicated to execute these technologies on physical IT infrastructure. The automation and innovation that such cutting-edge solutions built exclusively on the cloud bring to your enterprise will contribute to making your business more cost-effective.

Restructured IT teams

Eliminating in-house maintenance and infrastructure requirements will remove the need for extensive IT personnel. This decrease in workload saves IT costs on recruitment, and with a smaller IT team, you can focus more on management and redirect your team to work on other business areas. For smaller organizations without technical skills and bandwidth to assign IT workloads, cloud computing can become an effective solution for their IT requirements.

You will be able to realise these cost benefits only with proper strategy, planning and management framework around cloud adoption. Moving to the cloud without taking into consideration your business goals and current infrastructure will not convert into cost savings for your organization. Building and executing the right plan of action will enable you to enjoy cost-effectiveness, flexibility and many other benefits of the cloud.

Cloud adoption has become an essential step in every enterprise's digital transformation journey. The right IT expertise and guidance from a technology partner can simplify this process and help you achieve cost savings for your business.

Anirudh Kala

Co-founder, Director and Chief Data Scientist, Celebal Technologies

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