Part 2 of a five-part series on what to keep in mind as you transition to the cloud: Your Bottom Line.

In part 1 of this series we took a look at security and vendor lock-in as possible concerns in moving to the cloud. In Part 2 we want to consider every executive’s greatest concern for their business: their bottom line. If cloud computing is both secure and flexible, can you be certain it will positively affect cash flow?

The most obvious savings in cloud computing are the following areas:

  • Power – it takes a lot of electricity to keep those servers fired up all the time. With cloud computing, say good-bye to those old power company bills.
  • People – it takes a highly qualified and well-compensated staff to manage a well-run IT department. Now, that cost is someone else’s concern.
  • Capital – Servers and other infrastructure hardware cost money, often requiring duplicates in case of emergency, maintenance, and replacement. Not anymore.

Also, cloud hosting providers set up your data and applications on a remote server, enabling a pay-per-use model, which works much in the same way as your local utilities. Sure, the flexibility and “pay per use” model in cloud computing sound like huge benefits to executives, but to get a clear picture of your savings, you need to conduct a thorough IT department audit to identify exactly how much you’re currently spending on IT, including hardware, maintenance, updates, and labor.

Then have the cloud hosting provider you are considering provide you with a Cloud Readiness Assessment and a quote for simple comparison. Most quality cloud hosting providers will offer you the assessment free of charge to identify whether their services are a good fit for you. With your input, they will assess your computing needs aligned with your business goals and provide a quote. This should be completed reasonably quickly. If your provider takes a long time to provide the assessment, you might expect a long wait in case of emergency!

It’s not always the case that moving wholesale to the cloud will lead to instant cost cutting. Sometimes mature virtual infrastructures, for example, can be roughly equivalent to cloud hosting services in terms of cost.

More often than not, however, there are huge savings to be had in migrating to the cloud, but you need an accurate understanding of your current setup and its current cost for a clear picture of your overall savings!

If uncertainty about your bottom line has kept you from migrating to the cloud, maybe it’s time to make the change. At True North, we aim to provide business leaders and IT pros with useful insight into the dynamic field of business cloud computing services, computing environment consulting solutions, and our host of managed services to empower you to reach your goals.

Please check in next week for Part 3 of our five-part series: Disaster Recovery.