Cloud Computing and Cost Effectiveness

A Study of how Cloud Computing related to Cost-Effectiveness
Annotated Bibliography
Carcary, M., Doherty, E., & Conway, G. (2015). The adoption of cloud computing by Irish SMEs- an exploratory study. Electronic Journal of Information Systems Evaluation, 17(1), 3.
This article ascertains that the major reason why SMEs in Ireland adopt cloud computing is for cost-effectiveness. The study shows that cloud computing supports greater capacity levels and also protracted capabilities of the organization, devoid of incurring additional costs, which would have otherwise required investment in personnel training, infrastructure, and software. Also, a key feature of cloud computing is its capacity to diminish the financial burden that is placed on firms in technology adoption. The authors also demonstrate that cost reduction can be achieved through the capability to shift from a CAPEX cost structure to an OPEX one. Cloud computing also facilitates the utilization of resources as it eradicates the necessity for the organization to provide excessive services or increase the capacity to shelter against unanticipated future requirements. Moreover, cloud computing facilitates increased organizational scalability and also adaptability by enabling the entity to decrease its capacity.
Shankar, K. (2016). Effectiveness of Cloud Computing in Global Business. Journal of Applied Management-Jidnyasa, 8(1), 66-73.
This article examines the efficacy of cloud computing in the operation of global business. Shankar demonstrated that one of the key aspects linking cloud computing to cost-effectiveness is decreased computer costs. Through cloud computing, the organization does not necessitate computers that are either highly powered or priced to operate the web-based applications. Taking into consideration that the applications are run in the cloud, it implies that the firm reduces the costs incurred in investing in personal computers or desktop software. Cloud computing also facilitates cost-effectiveness within the organization based on diminished software costs. Different from the traditional desktop software applications that are expensive, it is possible for an organization to get several cloud computing applications at no cost, for instance, Google Docs suite. Furthermore, the article indicates that companies achieve cost savings through cloud computing. Different from desktop computing, where hard disk crashes can result in the destruction and loss of the firm’s valuable data and information, the same does not apply in the cloud where data is stored effectively.
The cost-effectiveness of cloud computing is perceptible. Rather than purchasing extra servers and storage devices that are solely employed to a small proportion of the working time, together with the extra software licenses that might be necessitated by personnel, cloud computing only ensures that payment is only made for the time used. These cloud computing services that are metered permit corporations to employ a more wide-ranging variety of capabilities devoid of incurring the expenses associated with enforcing these systems and applications within their own IT divisions.
Attaran, M. (2017). Cloud Computing Technology: Leveraging the Power of the Internet to Improve Business Performance. Journal of International Technology and Information Management, 26(1), 112 – 137.
In recent times, cloud computing has emanated as a significant technology that could contribute to the operational efficacy of an IT platform through the provision of infrastructure and software solutions for the entire IT necessities of an organization. This article provides key insight into the cost-efficacy advantage of cloud computing in enhancing business performance. Attaran indicates that cloud computing significantly decreases the capital investment required in software and hardware infrastructure for organizations.
The supplanting of solutions on the enterprise’s premises with the cloud computing model can render numerous instantaneous advantages to companies, including the eradicated necessity for maintaining a server, no need for setting up information technology infrastructure, and eradication of paying license fees upfront. The firm also achieves cost-effectiveness in terms of the diminished need for purchasing software programs, in addition to installing and maintaining such programs within the premise. Cloud computing is cost-proficient owing to the reason that the structure employed is pay-per-use based on the resourced that have been expended. Also, such resources are released when they are no longer necessitated, therefore cutting costs.
Obtaining additional information technology storage generally necessitated extra hardware and increased expenses. Nonetheless, in using cloud computing, there is increased flexibility. The firm attains the capacity to store enormous data amounts inexpensively and also make the acquisition of resources on demand. Furthermore, firms can scale up with the increase of computing requirements and, at the same time, scale down when demand levels decline. Consequently, this eradicates the necessity for enormous and costly investments in local information technology infrastructure.
Moreover, the management of resources using cloud computing is cost-effective. This is based on the fact that deploying computing services can be done relatively faster, thereby facilitating ease of use and financial advantage. Cloud computing technology facilitates the capability to select the IT resources necessitated in a manner that can develop and increase over time or immediately as requirements change.
Xue, C. T. S., & Xin, F. T. W. (2016). Benefits and challenges of the adoption of cloud computing in business. International Journal on Cloud Computing: Services and Architecture, 6(6), 01-15.
Cloud computing is an augmented technology and an ideal technological implement that enables organizations to remain competitive as it is deemed as an inventive way of increasing business value. The article indicates that the fundamental reason why organizations espouse cloud computing in their business operations is that it facilitates cost reduction. Firms are captivated by the prospect of cost reduction bearing in mind that cloud service providers enable in-house computing services. Furthermore, the companies pay solely for what they use. This implies that the organizations only make payment for the services that they use when they gain accessibility into cloud services. Also, cloud computing helps companies to achieve cost savings owing to their subscription models significantly. The article further indicates that cloud computing resources can be installed and implemented almost immediately. For instance, in SaaS, all aspects are carried out by the providers. Normally, the management, maintenance, and upgrading of these services are undertaken by the providers. This facilitates cost-effectiveness in terms of evading costs linked to staff training and also workforce for maintenance and servicing.
The article further indicates that when an IT solution has been executed in firms, it generates a problem that is incapable of having adequate funding owing to the high cost of procurement and maintenance of hardware and software. This adversely impacts the company. The adoption of cloud computing can aid in resolving these problems. The firms can transform their capital expenditures to operating expenditures. It does not just diminish the cost, but it aids in the formation and sustenance of a longstanding relationship, be up to date with technological advances, increase the levels of profit, in addition to providing uniform and low-cost services to consumers.
Elmonem, M. A. A., Nasr, E. S., & Geith, M. H. (2016). Benefits and challenges of cloud ERP systems–A systematic literature review. Future Computing and Informatics Journal, 1(1-2), 1-9.
This article explicates some of the benefits and challenges of cloud computing on ERP systems. Concerning cost-effectiveness, the article indicates that one of the major advantages of cloud computing is lower upfront expenses. That is, since the computing resources are separated from the firm’s location, it implies that the firm is not required to pay for constructing the computing setting, but only pays for gaining access to the computing setting over the internet. Secondly, there is the advantage of lower operating expenses. Specifically, the cloud service providers are accountable for the provision and operation of services and not the organization. Furthermore, cloud computing facilitates solutions that satisfy the needs of the enterprise as a whole.
Cost computing also enables the company to achieve cost-effectiveness by ensuring that the firm managing its operations more efficiently and also allows the entity to concentrate on other matters linked to its core activities. Furthermore, cloud computing services are highly elastic. Therefore, this means that organizations can scale up or scale down the expended resources based on their prevailing needs. Moreover, the firm can save costs from additional IT personnel. This is because the updating and upgrading process of cloud computing services is achieved quicker as compared to traditional systems. Finally, the article indicates there is an advantage of cost transparency. The company can employ either pay-per-use models or metered and subscription models that are placed in line with the firm’s plan. Therefore, the company only pays for what it uses, meaning there is no need for paying for what does not encompass the needs of the company. The article further indicates that cost-effectiveness is also achieved through free trials. Notably, numerous cloud service providers permit prospective clients to conduct tryouts of the services before making any acquisitions. This implies that the company purchases once it is certain of the usability and effectiveness of the service. Therefore, the company avoids wasting funds on systems that do not apply to or compatible with business operations.
References
Attaran, M. (2017). Cloud Computing Technology: Leveraging the Power of the Internet to Improve Business Performance. Journal of International Technology and Information Management, 26(1), 112 – 137.
Carcary, M., Doherty, E., & Conway, G. (2015). The adoption of cloud computing by Irish SMEs- an exploratory study. Electronic Journal of Information Systems Evaluation, 17(1), 3.
Elmonem, M. A. A., Nasr, E. S., & Geith, M. H. (2016). Benefits and challenges of cloud ERP systems–A systematic literature review. Future Computing and Informatics Journal, 1(1-2), 1-9.
Shankar, K. (2016). Effectiveness of Cloud Computing in Global Business. Journal of Applied Management-Jidnyasa, 8(1), 66-73.
Xue, C. T. S., & Xin, F. T. W. (2016). Benefits and challenges of the adoption of cloud computing in business. International Journal on Cloud Computing: Services and Architecture, 6(6), 01-15.