The cloud has become an essential tool for companies of all types and sizes, allowing them to reduce costs, increase productivity, and improve business agility. To understand the value of the Cloud, it is important to consider how the electricity revolution modernized manufacturing.
The transition to electric utilities
Before the creation of electric utilities, companies had to purchase and operate their electric power generators to operate their machines. This required significant capital investment, as well as ongoing repair, maintenance, and replacement costs. In addition, it made companies less resilient, agile, and productive.
Eventually, utilities began producing electricity centrally and selling it to businesses through the power grid. Not only could companies reduce costs and initial capital by using electricity from a utility, but they could also focus their energy and investment on improving product quality, developing better manufacturing processes, and improving customer service.
The computing and cloud era
Today, with the computing revolution of the 20th century, companies traditionally purchased, deployed, and managed their computing resources. As with a power generator, building a data center required a large capital investment, a long procurement cycle, and the expertise and personnel to manage it all. However, today, thanks to the Internet, there is a way to access centralized computing resources like those of AWS, allowing companies to avoid large investments in hardware and pay only for what they use, in the same way as with a public electricity service.
Top Four Benefits of the Cloud
Companies that move to the cloud can benefit from four main areas of value: cost savings, staff productivity, operational resilience, and business agility.
1. Cost savings and efficiency
Cost savings are one of the main benefits of the cloud. Companies using a traditional data center should do capacity planning to anticipate their technology needs and purchase equipment six to nine months before it is operational. Additionally, companies typically provision 20-50% above maximum requirements to avoid service interruptions. Average server utilization, according to the Natural Resources Defense Council, is only 12-18%.
With the cloud, organizations only pay for what they need. During periods of low usage, they use fewer resources; During periods of high demand, the system scales to provide the necessary performance. Supply and demand are closely aligned, eliminating the waste inherent in traditional data center models.
2. Staff productivity and collaboration
2. Staff productivity and collaboration In the data center world, employees spend a lot of time doing work that doesn’t differentiate the business. For example, a significant portion of staff could be dedicated to acquiring, configuring, and maintaining physical servers. With the cloud, these responsibilities are reduced or no longer necessary.
The cloud allows employees to access necessary data and applications from anywhere and on any device, improving collaboration and efficiency. Additionally, cloud collaboration tools such as Zoom, Slack, Asana, Notion, and more allow employees to work together in real-time, increasing productivity and reducing wait time.
3. Operational resilience and availability
Operational Resilience allows for greater redundancy of data and applications. Cloud service providers use multiple servers and data centers to ensure that if one server or data center fails, data and applications are still available elsewhere. Additionally, cloud service providers typically offer service level agreements (SLAs) that guarantee a certain level of uptime and availability.
4. Business agility and adaptability
Business Agility allows companies to quickly scale resources as needed, allowing them to adapt to changing market demands. Also deploying new applications and services faster than if they had been deployed on internal servers, allowing them to innovate faster and stay ahead of the competition.
In short, the cloud can be seen as a public service, since it is available to any person or company that needs it. Like electricity, the AWS cloud offers a reliable source of resources that can be scaled as needed, in addition to delivering key benefits such as reducing costs, increasing productivity, and improving business agility by enabling Companies to adapt quickly to the needs of the market and customers.