Controlling costs in the cloud: 3 steps to take

The belief that cloud computing costs more than it saves is easily considered the main drawback of cloud computing by most Finance departments. But if implemented correctly, costs can be minimal.

It’s no surprise when organizations run into hidden costs and problems that raise the price of cloud computing and weaken its performance. Among 650 IT pros surveyed by KPMG International:

1. 31% said integrating cloud services with existing systems was difficult
2. 30% said avoiding data loss and protecting privacy was a challenge, and
3. 26% said there is a lack of standards and flexibility among cloud computing providers.

Overall, one-third of companies said they ended up spending more on cloud computing services than they had planned.

Reining in costs

Controlling costs that are associated with cloud computing and the challenges it presents is possible. Here are three action steps to share with your IT department:

1. Plan for outages

Experts warn that the biggest risk of cloud computing is that cloud services may go down more than in-house systems. The key here is to plan ahead. Make sure your cloud provider has a backup plan in the case of their servers going down. It would also help to spread out where the cloud servers are located. For example, instead of strictly choosing cloud service providers with servers located in the eastern regions, have a provider with servers in another part of the country as well. If all of your servers are located in one natural disaster-prone area, you’ll have some challenges.

2. Consolidate services

It may make sense to have different departments choose the cloud services and vendors that make sense to their department. But that’ll be expensive. Some cloud vendors will offer discounts if services are bundled together, which you might miss if the purchases are made separately.

3. Decide what should go in the cloud

Some functions are better served by in-house systems, due to security concerns, performance requirements or other factors. So, what applications belong in the cloud? Here are the top cloud computing services respondents to a recent CDW survey said they have adopted or are planning to adopt:

1. Conferencing and collaboration (cited by 68% of organizations)
2. Storage (65%)
3. Office and productivity suites (65%)
4. Messaging (62%)
5. Compute power (59%)
6. Business process applications (57%)
7. External hosting for internally developed applications (55%), and
8. IT governance applications (51%).