More than half of all companies in the U.S. are now using some form of cloud computing, and with good reason. Moving to the cloud has the potential to save your company significant amounts of money while increasing security and improving customer service. But just because everybody else is jumping on the cloud bandwagon, does that mean you should as well? How do you determine if cloud computing makes sense for your business?

Analyze your existing infrastructure.

The first step in determining if it makes sense for you to move to the cloud is to analyze your existing infrastructure. Begin with the following questions:

  • How soon will critical components of your current infrastructure need to be replaced?
  • What will the replacement costs be at that time?
  • What are the maintenance costs of your current infrastructure between now and the time it will need to be replaced?

It’s important to consider all of the above elements in order to get a complete picture of your costs. If your hardware is early in its lifecycle and won’t need to be replaced for some time, your first instinct might be that moving to the cloud right away wouldn’t make sense. However, when you factor in the costs of maintaining your hardware until it needs to be replaced, you may reach a different conclusion.

There’s two types of maintenance expenses you need to consider—fixed or recurring costs and variable costs. An example of a fixed cost would be the salary you pay a full-time IT person, while a variable cost would be paying an IT vendor to resolve an event. In situations where a full-time IT person basically spends most of their time waiting around for something to break, moving to the cloud could make a lot of sense even if your equipment doesn’t need to be replaced anytime soon.

If your equipment will need to be replaced soon, moving to the cloud will almost certainly save you money. Since you will essentially be using a small piece of someone else’s hardware, your cost per unit will be drastically reduced.

Consider the security benefits.

In addition to equipment and labor costs, another factor you need to consider when deciding whether or not to move to the cloud is security. Contrary to what you might believe, the cloud is actually likely more secure than using your own hardware, due to the fact that your employees probably aren’t as security-conscious as they should be. Extended downtime due to a virus or other security breach can quickly get very expensive. Thanks to the extra security and backups that the cloud can provide, the chances of a financially devastating breach can be reduced.

Don’t forget customer service.

Last but not least, you need to consider the potential financial benefits of improved customer service available to companies using cloud computing. When you are able to dedicate resources to improving operational and business support systems that were previously tied up in maintaining your infrastructure, it will make a difference in the customer’s experience. Also, companies using the cloud have improved redundancy and agility that benefits the customer.

While there are certainly many benefits to cloud computing, it isn’t necessarily for everybody. By taking all of the factors mentioned above into consideration, you can determine if moving to the cloud makes good financial sense for your company.

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