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Laura Brown's Blog

The cloud and start-ups; a marriage made in heaven

Setting up a new business is hard work. It’s all-encompassing, time consuming and for the first few heady months money can be tight.

Yet the latest figures show that instead of being on the fringes of British business, in fact increasing numbers of individuals are setting up their own companies. The UK’s start-up culture is in full bloom  with £4.9m worth of SMEs responsible for 60% of employment in the country. It’s a major part of why the UK economy is recovering so well.

So why have more people decided to forge ahead on their own? Why, increasingly, is a start-up in the business future of so many of the UK’s workers.

Technology has made an entrepreneurial spirit much easier to achieve. Starting your own business is, now, thanks to cloud computing and open source IT a much more cost-effective and achievable goal.

The most optimistic tend to be those under 35 with over half (54%) saying their are upbeat and confident that it’s much easier to set up a company than it used to be.

The truth is our digital culture has transformed how we do business and has change the way of life for many of the UK’s entrepreneurs. Selling online is now common place. E-marketplaces and e-commerce are much cheaper than buying a bricks and mortar store, having to invest in staff and having an expensive outlay before you’ve even opened the doors.  A great online presence can give a company the edge, helping it to engage directly with customers.

The Cloud is a major part of that. Reducing costs enable start-ups to emulate major international firms with half of the overheads. It enables communications and marketing to become much more flexible. Sales are conducted easily and the entrepreneurs themselves can test and try out new ideas and ways of engaging without investing in an expensive piece of kit. That allows entrepreneurs to be more dynamic, innovative and braver. Innovative companies tend to grow faster and make more money in the long term so giving these start-ups room to breathe bodes well for their future success.

It’s easy for cloud computing providers to see the UK economy going in the right way, to see confidence rising amongst SMEs and to take credit for it. Much of it is about being in the right place and the right time. How many companies would have experimented with the cloud if the downturn hadn’t demanded the majority of firms needed to look for more cost-effective ways of doing things? The downturn has created a generation of entrepreneurs who are independent, braver and willing to try new things, they are confident in their ability to get their online presence right and know what they’re looking for. The growth of cloud computing and the birth of this new wave of entrepreneur is a marriage made in heaven.

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We’re all in the cloud

There’s no excuse anymore. You officially can’t say that you’re not in the cloud because “no one else is” or because “you’re waiting to see how it pans out”. Cloud computing is, officially, part of business IT.

The Cloud Industry Forum asked 250 senior IT and businesses about how they’re using the cloud, if they are at all.

79% of those who responded said the cloud is now part of their business strategy. Just under three quarters said they are making IT deployment decisions with an eye to an infrastructure refresh. Since the last research undertaken by the group in September 2013 takeup of the Cloud has increased by 15%. CIF say they expect this to turn into 20% – so a fifth increase – by September this year.

CIF was formed in 2009 as an industry body designed to promote best practice within IT and cloud adoption and use. Since they took their first survey a year later in 2010 they estimate that cloud adoption has increased by 61.5%.

The figures compiled by the body suggest that 90% of all businesses in the UK are now using the cloud in one form or another. Just under half of their respondees said they use one cloud service, under a third say they use two with 13% say they use three. This suggests most businesses are using the Cloud to cover one element of their IT provision and perhaps that businesses are in a testing mode, trialling the cloud in one aspect to see whether it suits them and that they are finding it useful, cost effective and flexible enough. Next year when Windows Server 2003 support ends, CIF predicts that more businesses will take up different elements of the cloud to extend over different services.

The whole thing about the cloud , from the very beginning, has been about flexibility. Businesses don’t have to adopt all elements of the cloud wholesale. Instead they can pick and choose, different elements and pieces to test it, see if they like and if it works for them. Either project based or for different teams and elements of the business this piecemeal adoption is helping businesses to figure out how the cloud can work for them individually. Every business is different and so their IT provision and needs are wide ranging. There is still a legacy of historical investment in data servers and the like, which affects how far businesses want to overhaul their IT infrastructure. Yet these latest figures suggest that for the majority of businesses the cloud is working, even if they are just using it for one part of their operation.

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How the cloud can help developing countries

The economic implications for the adoption of cloud technology have been quite well versed, but what is just beginning to become apparent is the impact it can have on developing countries.

Cloud computing is now widely seen as a disruptive technology. Its implications in terms of markets, economies as well as society as a whole is being carefully assessed; it can fuel new business growth and expansion, and as businesses grow economies become stronger.

However when much of this has been reflected on and discussed we tend to be thinking of European or American companies and infrastructure. We rarely consider the impact on developing countries like African nations, in the rapidly expanding China or South America.

A new report from the University of North Carolina, and written by Nir Kshetri, examines the adoption of cloud computing in developing economies and argues that the developing world must “exploit the opportunities afforded by cloud computing” while also minimising the risks associated with harnessing data and security.

There are few developing countries using cloud computing. In East Africa the investment has focused on e-education, in Vietnam on e-education and e-governance, in West Africa the application has been e-environment. There is an element of suggestion there that the adoption is used to fix localised and singular issues or problems; pollution, environmental issues, school, and democracy.

Yet there are much wider opportunities that can go hand in hand with development and economic growth. A KPMG report on exploring cloud adoption asked 400 government executives across 10 developed and developing countries what the principal economic drivers were for migrating to the cloud. By far the majority focused on the cost savings with the second highest response being the ability to change or enhance the interaction with customers. The ability to change the way a business is done, to build it from the ground up and to grow quickly and cost-effectively by using the cloud is a powerful driving force for developing countries and represents a real opportunity.

Yet adoption in developing countries remains low. There are barriers, citing fears over data privacy, infrastructure, and a lack of knowledge and understanding about both the cloud and its implications.

So how can this be tackled? Clearly innovation (and cloud computing fits firmly into that box) cannot simply be seen as a tool or opportunity for developed countries to further grow their economic prowess. It has to be open to developing countries as well to help the achieve an equal footing. What is vital here is collaboration. Global companies can step in and support developing companies in tackling hurdles, in improving knowledge, understanding and infrastructure to build on the economic and entrepreneurial opportunities the cloud presents. Without that cloud adoption will be something that further widens the gulf between the haves and the have nots. If it is, and can be, used as a spur for regeneration and economic growth then surely that is exactly what the cloud can be.

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Making the Cloud more public

The Cloud isn’t just about startups and tech whizzes, it can benefit the public sector as well.

When we think about innovation in technology we do tend to think of young hipsters working in creative surroundings focused on having the next big idea that will make them billions.

In fact, technological innovation isn’t – and shouldn’t – be about that at all. Sometimes the biggest shifts happen when we least expect it, because they’re about making small changes to people’s lives that radically make them simpler or easier. That is where technology has its true power.

Cloud technology is about streamlining, making IT simpler and easier. It is about levelling the playing field and improving access to both services and products. Nowhere is this more important than in the public sector. A year ago, the Cabinet Office announced what it was calling its “cloud-first” strategy where all IT projects should be in the cloud. That covers the NHS, government organisations locally and other public sector bodies offering real hands on services for members of the public.

What you’re offering for a public sector client isn’t probable that different to what you’d offer one in the private sector. The service and the approach at the heart of it will remain the same. The public sector is, obviously, much more accountable so there need to be checks balances and reporting procedures that make it easier for technology to be updated.

Yet the government has found that while there are obvious benefits to cloud migration in the public sector – reducing costs and timescales, making technology and services more affordable and accessible for those who need them, take up has been very slow.

One of the criticisms has been levelled at cloud companies themselves, suppliers who haven’t signed up to what’s called the G-Cloud and offering their services to public sector institutions. That’s probably only half the story, the public sector is, traditionally, an unwieldy beast that embraces change slowly. Migrating to the cloud takes a widespread education, training and change of pace which at a time of budget constraints is none too welcome.

Yet the medium to long term benefits are clear, even if initially there might be a headache. And a simple way to achieve them is to ensure both sides work together. Vendors and suppliers need to be able to clearly and effectively illustrate how their offer can be made to suit the public sector. Similarly the public sector needs to embrace the fact that change is coming and that it will have areal and long-lasting positive effect on its users and customers. It doesn’t necessarily mean starting products from scratch but it does perhaps mean the public sector side sitting down and thinking about how they want to improve their offer to their customers and suppliers being honest about what that entails and how they can do it simply and easily.

 

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Amazon’s boss says the cloud needs to empower the consumer. He’s right

Amazon have a touch of the Marmite’s at the moment. Yes it’s convenient and easy but with accusations around tax avoidance and criticisms around their all-powerful dominance in the world of retail at least, using Amazon is some circles is like a guilty little secret.

Yet in the world of cloud computing in the past five years at least they have treaded a path others seek to follow. That makes them a thought leader in the field, especially when they talk about future practice.

So when their CTO Werner Vogels starts talking about where we need to be in terms of cloud computing, you’re going to listen. In an interview with the Guardian, Vogels talks about the promise and the reality of cloud computing being a place where “massive computing power, digital storage and global network connections” are a click of a button away. The biggest start-ups across Europe are relying on the cloud to enable them to innovate and to better serve their customers.

When you talk about cloud numbers across Europe they get big very fast. The cumuluative economic impacts of the cloud between 2010 and 2015 are estimated by The Centre for Economic and Business Research to be £623bn. The cloud economy is growing by more than 20% and could generate 4m jobs by 2020.

It is staggering what the potential for the cloud across Europe – just Europe, never mind the globe – could be.

So how do we make their potential a reality? How do we ensure that those currently not using the cloud are empowered to adopt it and become part of the change.

The cloud needs to, Vogels believes, aspire to a higher set of values that merely those of business. Europe itself is built on values of fair and democratic rights. The Cloud, he argues, needs to do the same.

The most practical way to do this is to establish a set of core values; who or what is most important. Vogels argues that it’s the consumer and the customer who needs to be put at the heart of every step of the operation. This puts the power firmly with them; customers want freedom, they want to be able to walk away if they don’t get the service, they don’t want expensive fees and they want an honest and open service that has no hidden costs.

Some businesses might struggle against this. They remember the old ways that IT used to work.

when you could tie customers into long deals, offer great service at the beginning of the relationship that wears off after a while and to keep selling in products that don’t really suit the customer’s needs or wants.

 

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Life in the cloud

How does being in the cloud change the lives of the end-user? Do your employees enjoy it, have they felt a benefit? What about your customers, are they in the cloud? If the answer is yes, it’s going to affect how you both talk and do business with them. If you don’t know then you should find out.

It’s a lot of questions but perhaps the results of a new survey revealed this week can help provide some answers. This week at a cloud expo in New York, SOASTA released their Cloud Computing Survey. They’d asked over 2,000 adults online about how much they use the cloud in everyday life.

The results show almost 40% use the cloud. Of those, 86% say it’s improved working lives. When asked about usage the highest percentage of any age group using the Cloud is millennials – those aged between 18-34. Households with children were more likely to use the cloud than households without – 52% versus 33%. Students are most likely to use the cloud, followed by those in jobs.

When those who use the cloud were asked to breakdown the effect on their lives, 41% said it made file-sharing easier, with the same number saying it gave them peace of mind because they didn’t need to back up as often. 40% said they used it to store pictures of friends and family and just under that, 37% said they used the cloud to access music wherever they were. A fifth liked the security using the cloud to store sensitive data they didn’t want to leave on their phones and just under a fifth – 18% – said the cloud made their jobs easier.

The survey results show that the cloud is beginning to have a significant impact on people’s day to day lives, both inside and outside of work. It is perhaps inevitable that take up is higher among the younger population more adept at embracing new technology. The reliance for sensitive and precious data like family pictures emphasises the need to shout about security and protecting data.

How both consumers and employees think the cloud affects them is vital to understand how it’s used and how it can develop. Every strategy for reaching a target audience starts with what they want and how consumers, especially younger ones, are using the cloud can impact on  on how they can use services, how they shop and store information. One of the key elements of the survey was young consumers realising they can spend less on smartphones if they use the cloud because they don’t need to pay for extra memory. This can affect product development, as well as communication with the target market.

For employees the way the cloud is changing their working life affects their organisation, sharing files and keeping track of day to day activity. Respondees said it helps them collaborate with coworkers easier. This is exactly what many firms who brought the cloud in would want to hear. Streamlining activity and making it simpler makes it easier for them to make time for innovation, for creativity and for enabling flexible working.

The cloud is never introduced in isolation. Understanding how and why its end users are consuming it and how it is affecting them can help to shape future strategy and product development. IT can impact on messaging and reaching a target market more effectively.

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Starting out in the Cloud

Big cloud companies are starting to target even the smallest of businesses. What will it mean if the Cloud is used at every stage of business development?

Across the pond in Canada, Microsoft is targeting small businesses. Even the smallest of start-ups, it believes, can benefit from using the Cloud. The growing availability of the Cloud across every tier of business is driving down the price and making it both more affordable and available.

Startups, traditionally, don’t have the biggest of budgets. In fact during the downturn when many firms found it difficult to secure funding and investment from banks, many startups have discovered streamlined ways of operating and ensuring their tiny budgets go further. So investing in an expensive cloud infrastructure is not high on their to do lists. Start-ups tend to figure out exactly what technology needs they have and then find the solutions to match them. Without the cushion of finance startups tend to prefer to spend money where they know it will be effective and have a positive impact.

Microsoft’s decision to target this smaller firms means they have had to to address very different concerns. A major international company with millions of pounds to spend on overhauling its infrastructure will appoint a project manager or IT manager to review their options. The whole process will require investment, from research to input and implementation. Time needs to be spent ensuring the right infrastructure solution is found.

A startup simply doesn’t have that kind of time and resources. An entrepreneur is likely to be bringing in the business, doing work for clients and researching potential technology solutions as and when needs arise.

Practically speaking, that means technology and cloud providers simply can’t attach the same price tags to infrastructure services to the two different markets. Costs for accessing data and as more and more startups are created across the country it makes sense that technology firms should start to adopt more bespoke pricing systems to suit them.

The Cloud is inevitably an engine of growth. Research in America suggests that smaller companies that use social media and cloud computing are able to grow 15% faster and hire more staff than those who don’t adopt new technology. The Cloud is a vital tool in enabling small firms. Yet they still need tailored support for adoption at every stage of their development. Even if a startup has aspirations of being a multinational they can’t begin by paying the same rates as a multinational.

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Why do we focus on risk?

This morning I woke up to news that Google is going to introduce the first driver-less car in Silicon Valley. Armed with just a ‘stop’ and ‘go’ button the cars will be able to pick people up across Google’s HQ and take them to where they want to go. It has the potential to transform how we drive and move around our biggest cities.

Yet the instant reaction in the media is one of fear and cynicism. What would it do to taxi drivers? Wouldn’t people lose their jobs? Who’d be to blame if there was a crash? Do we want Google to have that kind of power? Instead of thinking ‘Wow, that’s kind of interesting, I want to know more’ the immediate reaction is often to find the fault, find the failing and knock it down.

This is a bad trait. Developing technology needs an element of risk and failure. Crazy ideas only seem that way because we’ve never seen them before. There needs to be a sense of acceptance, of curiosity instead of spending our first reaction time thinking purely of what might go wrong.

It’s the same thing that’s happened with a lot of companies when it comes to the cloud. A new kind of technology that removes the need for IT infrastructure and provides a flexible and scalable solution is reduced to a fear of risk. Firms should shy away from the technology because of confidentiality issues, of data security and other concerns. Instead of seeing the solution they should just dismiss it, just ignore it and hope that it will go away.

The problem with this negative response is that it means you get stuck. You can become so fearful of change and advancement that you stay doing things the way you did when you started, never evolving, never graduating to the next level. If that was how the biggest businesses wanted to operate then we’d still be working using pens and paper with a team of typists to write up our missives.

That isn’t to say that concerns and risk shouldn’t be reflected on, it should. Yet focusing on the risk first can make us dismiss the technology altogether, meaning we can’t move forward. It means the risks get bigger than the advancements and become more important, when they’re not. Every technology will have its risk, its drawback. The evolution comes from recognising that and solving the problems that come up. Think of the ways we secure online banking, yes having a device you need to carry around to get into your account is frustrating but right now it’s the best solution to make our banking details as secure as they can be. New solutions will develop and the software will evolve. That doesn’t mean we should dismiss online banking until they get it right, it’s convenient and it’s useful.

So I’m excited about driver-less cars. Yes there will be problems. Yes there will be issues to iron out. But embrace the future, because otherwise you’ll get stuck.

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Skills to pay the bills

Often you only realise how far you’ve come when you turn and look back down the track. To consider how far we’ve come in terms of the cloud perhaps it’s useful to see it from this perspective; if you were starting a company today from scratch would you bring someone in to completely build the infrastructure and then physical server you need to run it, or would you just rely on SaaS and a Cloud system to operate in a more cost-effective and flexible way?

Obviously it’s the latter and it just illustrates how far the Cloud has become an intrinsic element of how we build a scalable business infrastructure online.

Yet while we pat ourselves on the back while we look in the rear view mirror it’s also vital that we look forward. There is a gap within the industry that’s widening and it will affect the future of the cloud; it’s the development of skills. If we look at the the industry there are the early adopters who are evangelical about the technology, those skirt around the edges and use elements and those who won’t come near it. For those working within companies who don’t want to use the cloud at all, how far will their lack of skills in the technology affect their future and employment prospects?

Increasingly there is concern among certain sectors about the reluctance in take up of the cloud and how it affects the career prospects of employees. If you are a company that has resisted using the cloud and exploring the technology, how far are your employees restricted from other jobs within the technology sector because they have no experience in it? And taking it one step further how long is it before IT professionals will not work within your company because they know of your cloud computing reluctance and know that it may hold them back?

The cloud is widely seen as a valuable job skill. It is easier to learn than a lot of other platforms; it’s often plug and play and that makes it simple to get even a rudimentary grasp fairly quickly. For those early adopters and those working in the middle ground then IT staff have been able to work on strategy, on adoption and delivery. They have those projects and cloud incorporated titles already on their CV. If you work for a firm who hasn’t believed any of those things are important then that’s a major gap on your CV.

The cloud is having an impact right along the supply chain. Imagine you work in retail. Using cloud technology in terms of managing orders, infrastructure and organising people and logistics can be used right from the logistics and managing goods coming into harbour to firms transporting them to warehouses and then on to major retailers and their stores and customers. Cloud computing has reformed that whole supply chain making it easier to manage and monitor the movement of goods, making it easier and faster to get from dockside to customer’s homes. Having no experience of that technology within the retail sector, which has needed to keep up to date with technological developments to maintain a profit, could hold back a candidate in their next job.

So how can an individual ensure they maintain their edge and attractiveness to future employers? The cloud is flexible i terms of education so learning independently and establishing projects outside of work can help fill those vital gaps within a CV. Similarly learning through courses offered by the big providers can ensure you have a piece of paper. The cloud is increasingly part and parcel of our business landscape. Make sure you don’t get left behind.

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The rise of the Cloud outsourcer

If you’ve decided the Cloud is something your business needs, jettisoned the old server that restricted the ability of your company to grow and developed a plan to take you forward, what’s next?

If you’ve opted for flexibility and say an SaaS (Software as a Service) option then have you planned how to manage the system and make the most of the Cloud technology when you need it? Increasingly, businesses are looking to outsource the implementation of their data and other services – like communications, for example – that they want to use the Cloud for.

Say you’re a clinic and you recognise that using the Cloud would enable you to scale up your business, to store information on your patients and target your marketing to them more effectively by segmenting their interests and information and reminding them when appointments and check ups are. You know that this could improve both the quality and relevance of the information you’re sending to your customers and streamline your operation having a big impact on your business plan.

Yet at the same time you’ve got to run your business, right? You still have to do the day to day work to keep you ticking over. You know the potential of the Cloud and the difference it can make, but how do you fit it into your schedule?

By outsourcing the process and hiring a project manager you can ensure this side of the handover is handled by someone else who can identify the right applications and processes that will enable you to switch from one system to the next.

Like any IT outsourcing, when it comes to the Cloud it needs to be carefully managed. The Cloud itself, it could be argued, it a process of outsourcing anyway. You’re working with a computer server provider, like Giacom, to provide an “infrastructure on demand”. Yet there are practical and legal issues that need to be reflected on before, during and after the move to the Cloud, which a Project Manager can consider. The considerations around security, data protection and privacy (especially when you’re dealing with customer data) can be thought of as too great a hurdle, simply because it can take a little time to define the solution that fits both your company ethos and expectation. By outsourcing a PM can deliver a series of suggestions along with a strategy to ensure that, before the more to the new system begins you know exactly what you’re going to get and what the migration will involve for every stakeholders, from office workers to customers.

There are practical considerations to be looked in if a migration to the Cloud is on the cards. It can seem like a daunting process but by employing a qualified and tech-savvy project manager it becomes a much simpler endeavour where you have the full set of options described to you, each fleshed out and enabling you to choose the strategy that suits you best.

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