Software-as-a-Service Written in the Clouds (Steve Hankins Commentary)

I opened a recent lunch speech to the Fayetteville Northside Rotary Club with this question:  “Have you done your cloud computing today?”

Slowly, almost shyly, two people raised their hands. When I asked for a show of hands for iPhone and BlackBerry users, nearly every hand in the room shot up.

I asked for a show of hands for those that had used their iPhone or BlackBerry for something other than a phone call no hands dropped.

Everyone with a smart phone is doing cloud computing yet few realize it. Smart phones – iPhones, BlackBerrys, Droids, Palms – make use of “apps.” These “apps” typically access content or services housed somewhere other than on the smart phone over the cellular network.

The three biggest trends in technology, cloud computing, software as a service and mobility, literally converge in the palm of people’s hand.

Cloud computing, in simple terms, is computing that lives “out there somewhere.” For all but the most intensive business purposes, you don’t really have to care where it is. Most “apps” on smart phones make use of cloud computing.

Software-as-a-service, or SaaS, is simply software that is provided from the cloud.  This type of software is typically more “business critical” than most of the smart phone “apps” software.

The conventional business software model – I hesitate to say, “old model” quite yet – is to buy business software and invest in a server and related server software to run it on. Someone you pay is required to load your business software on your server and desktops. You pay to have the server managed on a daily basis. On top of all of that, you also pay annual maintenance fees on all the hardware and software.

With the SaaS model, you rent the software. The bulk of the cost described above is eliminated. Many times SaaS software solutions are referred to as “hosted solutions.”

The third trend, mobility, is the easiest to explain yet the hardest to fathom. It is now possible to have your computing with you at all times. Whether you use a smart phone, laptop, netbook or iPad, you have at your fingertips more computing power than was used to land man on the moon.

With these devices connected to the Internet through a smart phone data plan or a wireless network you have true mobility. Anything you need – content, services, or business software – can be accessed from wherever you happen to be. The notion of “having to go to the office” can be a thing of the past.

What does this matter to your business?

Today, customer demands for speed and high quality are near insatiable. Expectations must be met or customers will go elsewhere.

Small- and mid-sized businesses are challenged today to meet these demands. Typically their business software is dated and can’t respond easily, quickly or inexpensively to the increasing demands. Server infrastructure is often many years old and expensive upgrades are needed. Businesses often find themselves investing in more head count to manage technology. Business information is scattered in bits and pieces among desktops and file servers in unknown quantities of Excel spreadsheets. Staff is added to compensate for the necessary business processes that aren’t enabled by technology. The cost of all of this to the business can’t even be calculated.

Businesses that are struggling with their technology need to look to the trends for solutions as well as considering conventional approaches.

By making use of cloud-based and SaaS applications, businesses can quickly move their capabilities forward with less time and up-front expense required than the conventional model. Focus can be placed on technology’s benefit to business processes rather than on buying and managing a back room infrastructure. Head count invested in technology can focus on business value. Bells and whistles demanded and needed by staff and customers, including mobility capability, are typically built in and available immediately.

It is important to small- and mid-sized businesses to leverage these trends. Otherwise, they will increasingly find themselves at a cost and competitive disadvantage to those that do. 

(Steve Hankins is CEO and co-founder of Accio.US, a technology company based in Fayetteville providing advisory and management services for small to medium-sized businesses. He may be reached at [email protected].)