Why SMBs are shifting towards Cloud?

Small and medium-sized businesses (SMBs) are evolving by introducing new technologies and innovation in the ecosystem. Small and Medium Businesses form the backbone of the Indian economy by contributing a massive 30% to India’s total GDP.

To boost the Indian economy, SMBs have to play a crucial role by introducing digital adoption to improve productivity, profit margin, export competitiveness, and foreign investment in India. Various high-profile SMBs have already introduced fintech-based and cloud-based solutions in their business. They are now contracting with world-class technology service providers to expand their businesses and compete with foreign enterprises.     

The Upward Trend in SMBs Drive towards Cloud Adoption

After its introduction by the service providers like Google and Amazon, cloud, especially public cloud, has evolved surprisingly in the small businesses landscape. The internet-based framework provided by cloud computing offers easy and convenient, on-demand access to various resources such as storage, servers, and applications for their businesses over the internet. Technology adoption driven by digital transformation among the SMBs in India may assist in flourishing their service programs, making a customer-friendly system, expanding the customer segment by optimizing cost, and generating higher profits.  

Why are Indian SMBs Adopting Cloud Computing?

Cloud computing is an evolutionary change having an immense potential to benefit the small and medium-sized business sectors. In the last five years, India has noticed a significant growth of SMBs moving towards digital transformation. A survey conducted by the National Association of Software and Services Companies (NASSCOM survey) reveals that:

• India’s public cloud markets have already achieved INR 170 Billion in FY2020. Moreover, the market will reach INR 630 Billion by FY2025.
• 60% of Indian SMBs are already using the cloud in one way or the other. Also, they are expecting to see short-term revenue gain through the cloud-based solution.
• The survey provided a comparison between SMBs availing cloud services versus those who have not. Due to cloud services in SMBs, asset utilization increased by 50%, costs were reduced by 30%, and employee productivity increased by 50%.

The survey was conducted among 275 SMBs spanning Bangalore, Chennai, Chandigarh, Coimbatore, Hyderabad, Kolkata, Lucknow, Mumbai, Mysore, NCR, and Pune.

What motivates the SMBs to move to the cloud?

By now, SMBs are well aware that to seek high profits with low cost, better handling, and to rank in global competitiveness; they have to adopt cloud services in their digital transformation. 

• Cloud-based solutions allow SMBs to get the benefit of technology without worrying about infrastructure, operating, and maintenance, deploying and investing. 
• Compared to the traditional system cloud provides services such as messaging, collaboration, accounting, or any other application at a meagre cost. 
• The introduction of cloud computing has also relieved the CEOs of SMBs, regarding the threat to their data security. Cloud-based infrastructure provides a secure framework to safeguard the data of business entities.

The outrageous Covid-19 pandemic had shocked the nerves of SMBs in India. Simultaneously, it also opened up the window of opportunity for the business leaders to adopt cloud-based solutions. Cloud service providers made it easier for the SMBs to breathe during the lockdown by providing remote access to the SMBs’ employees and work from their homes. A study conducted by HP wolf security revealed that over 23% of employees are expecting to work from home post-pandemic, all thanks to cloud-based solutions.

What are the different use cases of the cloud for SMBS?

The scope of cloud adoption has now extended beyond financial institutions and big companies. As small businesses are embracing the cloud due to its various benefits, the results are already visible. Here are 5 key use cases of the cloud for small and medium businesses.

• Cloud File Storage for SMBs

By storing files on the cloud, SMBs can save a huge amount of money that was earlier invested in buying hardware such as hard disks. The employees of such SMBs can access and work on files even if they are not. 

• Docility and Automation

Cloud (both private and public cloud) is a flexible option that can be customized as per your business needs. Also, as the files on the cloud get automatically updated, businesses do not need to invest in information technology. 

• Data Backup

As a small business owner, you probably are already aware of the importance of backing up your data. Using the Cloud simplifies the data backup process by enabling your data to update even while you are working on it. Besides, the cloud forms off-site copies of your data to prevent any damage from data theft and malfunction.

• Remote Working and Information Sharing

Cloud enables businesses to have functional mobile offices, i.e., remote working. This has been the largest use case of cloud during the last two years. By allowing the employees to access and sync the files whenever and wherever they want, cloud technology forms the foundation of remote working.

In addition, the cloud enables effortless data sharing by making it as simple as sending a link.

• Growth Planning

Cloud technology is scalable and flexible. The SMBs adopting cloud can allow small businesses to plan their growth strategy by making use of the benefits of the cloud. As the cloud is self-manageable, this also removes the requirement of hiring IT staff. Also, as it does not need significant up-front costs, the cloud is a perfect option even for someone just starting the business.

Why would cloud computing be attractive to a start-up or small business?

Well-known service providers such as Google Photos, Google Drive, and Dropbox also provide cloud computing services to their users. After signing in to these accounts, you can use your data anytime with any device having good internet connectivity. Similarly, cloud computing being one of the cloud trends, is a wonder for start-ups and small businesses. At a very low cost, they may get access to their business data and applications from anywhere, anytime, and from any device. Looking forward to the numerous benefits of cloud computing, it becomes attractive to a start-up or small business.

Benefits

1. Cost: Introducing the cloud in your business will help minimize your cost by eliminating the cost of hardware & software services, hiring IT personnel, building rooms for hardware & electricity, and other infrastructure. 
2. Access: Start-ups require 24/7 access to their business applications and data. Cloud provides the application by which businesses can rely on their mobiles, tablets, or laptop to use their business application regardless of time and place. 
3. Productivity: The cloud computing framework not only increases management productivity but also increases the productivity of co-workers’. 
4. Security: Once businesses have shared their data with the cloud service provider, the risks of cyber attacks reduce. Cloud computing secures data storage and reduces the risk of cyber-attacks or any personal theft of business data. 

For any new start-up or a small business; generating the monetary funds for the office building, staff, and computer systems, sufficient hardware space is the most challenging task. With the introduction of digital engagement channels such as cloud computing, start-ups don’t need to maintain a big staff or a building with huge space. They can just contact the cloud service provider and, at a minimum price, the business of maintaining the services and business application, including messages, emails, and invoices, becomes the responsibility of the service provider company.

What business function can be improved by the adoption of cloud computing?

The businesses that were once hesitant to digitize their business operation are now eagerly introducing cloud trends as part of their technology adoption journey. In addition to the low-cost benefits, numerous SMBs are looking forward to cloud-based solutions for solving their everyday business problems.

1. Supply chain: Every business needs to ensure that its service or products get noticed by the people seeking them. Cloud computing provides intelligence and automation, which benefits businesses to understand the needs and desires of the customer. Understanding the market trends directly helps SMBs to increase their sales and profits. 
2. Shorter consumer journey: This is one of the key benefits of the cloud that directly helps SMBs increase their product demand while satisfying the customer with their fast e-commerce product delivery. Cloud computing applications create data-based customer profiles, digital wallets, and enable fast delivery. 
3. Disaster Recovery: Adopting cloud computing will assure the backup of businesses data and applications regardless of any natural disaster. It is hard for small business organizations to set up a particular unit to carry their information and data backup. 

Read more: https://smeventure.com/utilization-cloud-computing-manufacturing-sector/

Needless to say, there are several risks associated with technology adoption, especially cloud-based services. Breach of data security and loss of complete control over the data are two of them. But, the cyber attack risks can be reduced to a minimum by adopting the right approach. Moreover, the benefits of the cloud outweigh the risks for small businesses. 

Written by,

Prasad P. Patkar