The cloud has not only conquered large corporations in recent years but also offers some advantages for small and medium-sized businesses. More and more small and medium-sized enterprises (SMEs) are relying on cloud-based solutions because they are easy to calculate and can be adapted as required. New business models can be implemented without a significant investment in risk. There is no need to purchase and maintain expensive IT infrastructure. Cloud providers offer a range of services that differ in terms of computing power, storage and memory.

The benefits of the cloud for SMEs

Optimal workflow in the world of work

The days when files were painstakingly shared or distributed via USB sticks or e-mail are coming to an end. In today’s working world, cloud software is increasingly used to simplify communication between employees and with the outside world. Companies that have not yet integrated a cloud solution into their operations are considering implementing one in the near future. Starting with shared calendar use and document management through to cross-platform team conferences, the cloud is already simplifying processes in the world of work. The mobile cloud is also displacing numerous business apps that have often been used in the corporate environment.

Software solutions in the cloud also offer the possibility that the customer can directly influence the projects to be negotiated. In this way, misunderstandings and errors can be prevented prematurely. Communication between client and contractor is simplified.

Digitized business process

One of the biggest challenges for small and medium-sized companies is currently the digitization of business processes. At first glance, the step to a cloud solution seems to be an ideal start.

Internationally active companies in particular rely on location-independent technology. Because information should no longer just be accessible centrally in the company network, but globally. If the information is stored in the cloud, it does not matter whether it is an appointment abroad where important data has to be queried or whether you want to share information with external employees or internal employees. User authentication enables secure access to data or software in the cloud via mobile devices such as laptops, tablets and smartphones. In this way, processes can not only be monitored remotely, but also optimized.

Computing power as required

Virtual machines (VM) form the basis of the entire cloud architecture. They virtualize system environments and enable hardware and software to work independently of one another. Operating systems are only installed in so-called containers, to which appropriate hardware resources are assigned.

One of the greatest advantages of a cloud solution for companies is the scalability of the infrastructure. Virtual resources can be accessed at any time to the extent required. This can not only be done with simple mouse clicks, but can even be automated. Automatic service provision exactly when it is needed. Applications in the cloud are designed from the outset to be available at all times. This implies that the software is also able to independently start new virtual machines as soon as a higher performance is requested. Not only hardware resources in the form of processor performance, storage space and main memory can be adjusted in this way, but also software licenses, for example. These packages can be canceled just as easily with the provider. This enables companies to ensure that their employees can all access the necessary data and services during peak load times, while idle computing power is avoided during times of low demand. For SMEs, switching to the cloud is often worthwhile because it enables savings in acquisition, operation and maintenance measures compared to their own IT. But this is not always the case, as described below. because it enables savings in acquisition, operation and maintenance measures compared to your own IT. But this is not always the case, as described below. because it enables savings in acquisition, operation and maintenance measures compared to your own IT. But this is not always the case, as described below.

Your workplace is always with you

Cloud computing opens up completely new ways of working in a digital and networked world. Data and applications in the cloud are stored decentrally and no longer necessarily require the presence of individual employees at the company’s location. As a result, home office and remote work can be made possible even during a business trip, thereby creating significantly more flexibility in corporate activities. In addition, the work-life balance is improved in many cases and employees benefit from more free time, since commuting times are no longer necessary. The cloud therefore increases satisfaction and productivity, while costs for office space and commuter allowances are saved. The cooperation of colleagues and partners, regardless of their respective location, is becoming increasingly important. The cloud supports project teams and helps its users to work together on documents and to organize appointments.

The cloud is always up to date

Software solutions in particular are subject to continuous change. Because software is quickly considered out of date, software manufacturers react to user feedback and have to continuously update their application. Often, however, new applications require the upgrading of existing hardware to function properly. The use of up-to-date and secure software is therefore always a question of cost. The cloud is supposed to help. Companies can move their infrastructure to the cloud and not only rent hardware but also software. There it is up to the respective provider to provide the appropriate hardware and to ensure that the software functions properly.

Tax advantages through the cloud

By moving to cloud and renting hardware and software, businesses can reduce the amount of net income they’re incurring, resulting in a lower tax bill year after year.

Petra Klingheim, account manager at says “The criteria that motivate companies to switch to a cloud solution also include tax breaks because resources are rented, not bought.”

She further adds, “In terms of tax, the costs can then be claimed directly when they are incurred – compared to fixed acquisitions that can be depreciated, but no longer have a tax-reducing effect after the agreed useful life.”

The cloud in the age of big data

In an age of big data, in which ever-larger amounts of data from various processes are accumulated, it is only a matter of time before the internal IT infrastructure proves to be a bottleneck in the company. Well prepared data is extremely valuable, which is why it is often referred to as the raw materials of the 21st century. But evaluating all of the collected data requires computing power and storage space. Since internal IT resources would be more expensive, some companies increase their computing capacity with the help of the cloud – and in the event that this service is no longer required, it can easily be terminated.

Use mobile devices securely in the cloud

The digital revolution not only gives rise to terms such as Internet of Things (IoT) or Web 4.0, but also shifts applications and storage space into the WWW. There, privileged end devices have access to company data from almost anywhere in the world and benefit from the high speed of various server farms on which the cloud services are hosted. Mobile devices do not only refer to smartphones, tablets or laptops, but also include the Internet of Things. This enables the data collected by sensors and other devices to be exchanged and analyzed without barriers between websites, applications, customers and partners. The cloud connects all of these players in real time and thus plays one of its greatest cards:

With terms such as Workplace-as-a-Service or Dynamic Workplace, cloud computing opens up many possibilities, especially for mobile users. The virtual IT infrastructure can also be used by mobile devices – even on private notebooks or smartphones. At the same time, a cloud solution used on the move offers potential attackers several ways to cause damage. As a rule, cloud providers rely on two-factor authentication, i.e. user identification through two different and independent factors – for example smart card and PIN. A simple and uniform user interface on all devices and web browsers enables access to data and applications. These can be adjusted by an administrator with the help of guidelines. This allows, for example, access to certain areas to be restricted to predefined end devices. In addition, the applications are always up-to-date, as they are provided directly by the provider. In most cases, a single registration process is sufficient to be able to use all services on the platform. If the end device is changed, the same open applications and documents appear there – work can be continued without interrupting the workflow.

However, care should be taken at all times to ensure that neither internal company nor private data is passed on to third parties. Data protection is essential, especially for mobile devices. These devices are a risk factor that should not be underestimated. After all, they are used everywhere and sensitive access data can almost effortlessly fall into the wrong hands. A potential aggressor’s glance at the display is often enough to read out critical information. When working in the cloud, data is usually transferred via encrypted connections. Secure cloud computing, however, depends on a number of criteria and does not just begin with the transmission.

The disadvantages of cloud solutions

With all the advantages that a cloud environment offers its users, there are some notable disadvantages that are more expensive or more complicated than an in-house IT infrastructure in some scenarios.

According to the leading IT market research institute Gartner, many companies tend to buy more performance than is actually needed. The possibility of using unlimited resources tempts you to buy too quickly. The fact that this service is then not used also has its origin in the configuration of the cloud packages. Many offers include a fixed computing power and storage capacity. If, for example, a lot of computing power is required for various analysis or rendering purposes, but hardly any hard disk space, this remains unused. If the opposite occurs, in which a larger amount of memory is required, the package usually offers an oversized processor, which is then mostly idle.

The migration itself can also be a hurdle – moving from local IT to the cloud. Not all software works outside of local environments. This can either make adjustments necessary or require the entire system to be converted. The latter usually requires additional employee training and, if integrated, can make processes that run smoothly more difficult. Location-independent usability can be an advantage with an optimal Internet connection, but it can also be a disadvantage with poor bandwidth. The cloud is only as fast as the connection allows. In extreme cases, this can massively restrict productivity or completely prevent use.

In terms of data protection, European cloud providers are subject to the more stringent provisions of the GDPR. However, many providers operate from other EU countries and are therefore only subject to the data protection laws of their home country. Since the cloud sometimes also contains sensitive data, cybercrime is one of the possible disadvantages.

Security risks when working on the move in the cloud:

  • Public, partly unsecured wireless networks in which data packets are transferred unencrypted between the user and the hotspot
  • Inadequately secured WLAN connections that can be spied on by criminals without great difficulty
  • Poorly programmed third-party apps and software
  • Existing security gaps in installed software
  • Devices infected with malware, viruses, or Trojans
  • Stolen or lost devices
  • Insufficient security awareness on the part of the user

Conclusion: The cloud as an integral part of corporate IT

The cloud is replacing conventional computer systems and relocating a large number of processes to server farms and data centers. With a sufficiently fast and reliable internet connection, large amounts of data can be handled even for SMEs – not just from a stationary workstation computer, but from a variety of different end devices. Smartphones, tablets, notebooks and special hardware (controls, sensors, etc.) can access important data and applications from anywhere in the world. Mostly everything from a single source and with a uniform, intuitive interface. However, cloud services require a certain amount of advance planning on the part of SMEs in order to make use safe and economical for everyone involved.

The speed and the user experience still depend largely on the performance of the available Internet connection. But here, too, improvement is in sight – in metropolitan areas, fiber optics are increasingly being used, while LTE is gradually becoming the standard in sparsely populated areas. In addition, the performance of mobile devices is increasingly becoming a negligible factor.

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