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How to Calculate ROI on Cloud Computing (the “Cloud”) ?

Calculating Cloud ROI

Even an inexperienced manager has been faced with calculating the value of spending a dollar.  You could be faced with staying within a budget, justifying a purchase or trying to estimate the value, or return, of an investment in your company (“ROI”).  However, the task of calculating ROI on moving all or part of a company’s technology to the Cloud can be quite daunting.

Part of the problem is that opportunities to utilize the Cloud are evolving quickly and it is definitely not “one size fits all”.  There are numerous Cloud applications advertised seemingly everywhere – from simply storing personal photos to performing complex corporate operations.  Companies like Google, Apple, IBM, Microsoft and Citrix all want you to believe they have the best Cloud Services; but they all seem to speak a different language.  Don’t blame them, they all have different solutions for different types of customers.  Add to the confusion that some Cloud functions are device specific (i.e. Amazon Kindle) and that computing requirements for some applications can be so massive  that normal internet connections may not be able to support them.  Finally, how do you calculate the cost of an intangible?  For instance what is the cost of employee downtime?   What is the value to your business to be able to attract young talent who have grown accustomed to working on multiple devices at any hour of the day?  What is your technology image to investors, vendors and customers?

Before you simply throw up your hands and give up, there are some simple steps you can go through to begin to calculate ROI for your specific needs.  Like many difficult problems, start by breaking down the calculation to the most basic questions you can actually respond to.  You may end up with a list of “unknowns”; but you may be surprised that you can begin to hone in on a range of costs and benefits that may satisfy the boss and make budgetary sense.  Go through the following steps to begin to organize your priorities and define the parts of Cloud Computing that is right for your environment.

6 Steps to Calculating Cloud ROI

  • First and foremost, answer the question, “Why do we need the Cloud?” Identify any current computing problems you are trying to fix.  If you are faced with spending money anyway, the timing is right to consider Cloud solutions.  Do not make a move simply because you are enamored with the thought of going to the newest and best technology available.  While there are many benefits to be had in the Cloud, some companies can perform quite well with a home grown,on-site environment.  According to a study commissioned by Microsoft, the top three investments in corporate Cloud hosting in the next two years will be: Database E-mail c. Corporate Applications (CRM, ERP, and industry specific apps)
  • After defining existing problems to be fixed, take time to define what your computing requirements will be in the next 1 to 2 years. For example, will you be upgrading your operating or accounting software; do you need a new e-mail or customer relationship management solution; or is there new industry software that would help your business.  Faced with spending on new applications you will find that nearly all have been designed to be easily hosted and that a per user cost could be much more beneficial to purchasing a package that could become quickly dated or require updates and maintenance.
  • Determine how important access to data is in your business.  Would it be detrimental to your operation if you could not recover your data within minutes, hours or days?  The Cloud provides secure backup and remote access.  The cost of data storage can be pennies per gigabyte, and service levels to restore data can be set according to the importance to your business and your budget.
  • Another critical step is to consider how many computer users you have, as well as where and how they will access your systems. If all of your users are on-site, and use company equipment – Cloud access may not be as critical.  Conversely, if you have remote users like salesmen, your management travels frequently or employees work from home the Cloud provides a perfect solution to accommodate different company applications on virtually any kind of device.  Typically the cost per user will go down as the number of users go up.  You may also find that Cloud service companies may require a minimum number of users.
  • Determine the age and performance of your current IT equipment. This could be the straw that breaks your back (or your budget).   More and more companies are realizing that investments in on-site infrastructure, such as robust servers, are very costly.  With on-site infrastructure you also have the inherent risk that the specifications at the time of purchase do not meet the changing needs of the business.  Also, there can be compatibility issues. Even upgrades to workstations can add up.  Take the example of replacing all the desktops and laptops when Microsoft discontinued support on Windows XP.  The computing and RAM requirements of workstations connected to Cloud applications are significantly less than stand-alone pc’s or laptops.  For some users, thin clients may be all that is needed at a fraction of the cost of a full workstation.  When faced with an infrastructure purchase, Cloud computing should be an option to be considered.  One critical advantage to Cloud computing is that it is “scalable”, that is you can generally add users and applications by simply adjusting your contract rather than trying to re-calculate the on-site infrastructure needs and costs.  For you finance guys, Cloud contracts can be structured as monthly operating costs freeing up your precious credit or operating lines.
  • Finally, calculate what you spend now on your IT support. Look in your accounting reports or even just your check register – it’s all there.  Make sure you include debt payments if you borrowed or leased equipment.  If you have an IT department, there may be a significant labor component dedicated simply to network support and user maintenance.  There aremany hidden costs that sneak up on companies because they are isolated or seem individually insignificant.  There is often efficiency in combining these costs in the Cloud versus the cost for every individual user for things like:

a) Licensing
b) Software copies (like Microsoft Office)
c) Anti-virus
d) Spam filtering
e) Backup
f) Monitoring,updates and support

You have gone through the 6 steps.  You determined the need is there and the time is right to consider Cloud options.  Sharpen your pencil and get to it.  Depending on the industry and all of the applications that may be needed, a range for full Cloud outsourcing will be $125 to $250 per user per month.  Remember, that is an “all-in” estimate with hardware infrastructure, updates, maintenance, licensing and backup/recovery.   It also provides your company scalability for new users.  While calculating Cloud ROI seems like an art, the more you refine the 6 steps, it will start to become more like a science.

About us:

Net Activity, Inc. is a business-oriented  cloud, computer & telephone communication and voip phone services, company. It is our mission to make our clients business more efficient using our technology services.

Try our Cloud Services for free – Cloud Computing Services

Eight Reasons Why Small and Mid-Sized Businesses Need Managed IT Services

Managed IT services is rapidly becoming one of the hottest solutions in business today because it dramatically improves an organization’s profitability, frees up internal resources, and offers a unique competitive advantage.   Simply put, managed IT services are designed to assist companies in maintaining and supporting their network and IT infrastructure with the assistance of an outsourced managed services provider (MSP).  Types of services may include remote network monitoring, programming and reporting (24/7), firewall monitoring, intrusion detection, preventative tasks, disaster recovery, data backup and help desk support.  There are eight critical reasons why small to midsized businesses (SMBs) need managed IT services now and throughout the life cycle of their business.

Dependence On IT

Almost all businesses have become more dependent on computer technologies in the past few years.  And, it’s a rapidly changing environment.  Every business has become dependent on its IT infrastructure to perform at a high level, while effectively delivering its products or services.  As a result, it has become more difficult to maintain the expertise to properly deploy, manage, and monitor this new technology, especially as a business evolves.

Complexity

The fact that this new technology is new makes it more difficult for the average employee to understand and use effectively.  The level of demand and sophistication from today’s businesses are driving up complexity.  Distinct disciplines or specialties are emerging in a variety of technology related areas such as telephony, desktop, network, application and database support.  The breadth and depth of technology an organization requires immediately places the resources at a small to mid-sized businesses (SMBs) at a distinct disadvantage.

Insufficient Solutions

Traditional support options such as a one man IT consultant, or a one or two person in-house IT department cannot effectively handle the occasional network breakdowns that are bound to occur. This is especially true when compared to a team of external resources that  proactively monitor the SMB’s installed technology at all times.

Lack of Process

An IDC study reinforces the notion of lack of process, showing that 78% of all IT downtime is caused by change.  If you could simply eliminate change from the computing environment, you would substantially decrease the risk.Unfortunately, most SMBs lack the procedures, documentation standards, and scope of work, which often results in major disruption and downtime.

Increased Use of Technology

Increasing use of computers, new software and procedures, often leads to increased complaints and loss of productivity.Typically, when network or desktop problems arise and escalate inside a company, the response time of the one man shop or internal staff is quite slow. This dramatically increases employee complaints and lowers productivity.  In many situations employees have to wait in line to receive help.  As a result the downtime and morale will impact the organization’s bottom line as well as their ability to meet their customers’ needs.  By implementing a managed IT services program, the demand on internal IT resources are lessened, and they can now be utilized for other purposes such as directly supporting strategic business objectives rather than becoming bogged down in frequent break/fix issues.

Controlling Costs

During these challenging times, the IT budget is frequently reduced.  In a recent survey of nearly 950 IT managers at companies in North America and Europe; nearly half of the U.S. respondents said they have already cut their IT spending budgets.  Unfortunately, a cut in IT spending doesn’t mean there is a cut in demand for services.  This adds tremendous stress and pressure on internal departments to support the same amount of work with fewer resources.

Technology Erosion

Computer systems must be maintained just like any other systems used within the business. Vehicle fleets, manufacturing equipment, and the physical plant, have all moved to a preventative approach. If a company does not implement this preventative maintenance strategy for its technology components, disaster might be the unpleasant and unprofitable result.

Compliance

Finally, the technology utilized within an organization in most cases must meet specific compliance standards.  For example, a company’s business processes supported by technology may need to comply with Sarbanes-Oxely, Health Insurance Portability and Accountability Act (HIPPA), Gramm-Leach-Bliley Act (GLBA) and other requirements. Most companies don’t have the resources to fully understand and comply with all the detailed requirements of these regulations.

All of the above issues are driving the popularity of partnering with a managed IT services firm.  Companies that have made the transition already answered this question.  If deploying, managing and monitoring my IT infrastructure has absolutely nothing to do with the core competency of my business, why wouldn’t I outsource it to an expert?  This is a fairly easy question to answer and these organizations have reaped the rewards of increased profitability and a competitive advantage.

About us:

Net Activity, Inc. is a business-oriented computer & telephone communication company. It is our mission to make our clients business more efficient using our technology services.

For more information on our Managed Services offering and an offer for a FREE Network Assessment – Managed IT Services

What Does Cloud Computing Cost?

 

Cloud Cost for Small Business

 

What is Cloud?

Cloud Computing is a method of delivering your applications, data, e-mail and other pieces of your network from a secure off-premise data center. With the advances in technology over the last decade and the speed/ availability of the internet, applications running on servers in a datacenter hundreds of miles away run just as fast as if they were installed on your local desktop. With Cloud, all of the processing happens on the server and multiple devices like PC, tablets and smartphones can access the information.  A simple example would be where one copy of Microsoft Office resides in the Cloud, and multiple users could be given access, even though the program does not reside on that users local device.

Many people are already familiar with Cloud Storage, such as iCloud or Dropbox.  This is also a secure off-premise datacenter which is dedicated solely to the storage of data which can be accessed by multiple users on any device.  In Cloud Storage solutions, there are typically no applications loaded and thus no processing occurs.

What does Cloud Cost?

As with most things in life it depends. You can calculate Cloud Cost based on the number of components & usage, servers, storage needed, processor needed, ram needed, and applications needed; as you can guess the list goes on.   Let’s look it from one simple angle of per user based Cloud Cost.

Cloud Cost components:

  • Server infrastructure
  • Emails solution
  • MS-Office (most users need it)
  • Sync software to link user BYOD Device data to Cloud Data
  • Terminal Server based Cloud seat or Virtual Desktop
  • Antivirus
  • Spam filtering
  • Backup & Disaster Recovery
  • Server support and monitoring 24×7
  • Workstation support
  • Support at client premise

Depending on the components included our experience shows a range of $130 to $240 per user per month. In other words the 10 users Cloud Cost per month could range from $1300 to $2400, depending on exact components needed.  In this simple example, the cost eliminated on premise includes: a physical server with warranty and support, local licenses, local antivirus/spam copies, backup, disaster recovery, power and local software updates.  Also, since cloud provides   rental licenses, Cloud provides the latest updated licenses, without capital costs.

Try our Cloud Services for free Cloud Computing

NET ACTIVITY Helps Customers Enhance Network Security Through Managed IT Services Cleveland

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Proactive Approach to IT Enables Local Businesses to Combat Threats CLEVELAND, OH — November 17, 2015 — Net Activity, Inc., a leading provider of unified communications, announced today that its proactive approach to managed services enhances security and helps companies combat malicious threats. Fortune 1000 organizations have plenty of budget available to spend on IT security infrastructure. They are fully equipped with in-house staff that is dedicated full-time to optimizing security across the board. While the necessity for IT security is in plain sight, many small to mid-sized companies may ignore this area of their business until it’s too late. Net Activity’s managed IT services Cleveland provides proactive resources to business owners everywhere. The company zeroes in on five key areas to focus on, to dramatically improve the health of their customers’ technology.

In its purest form, Net Activity’s managed IT services Cleveland anticipate IT issues before they crop up. It’s a proactive and cost effective approach that has changed the way businesses improve their productivity, streamline their efficiency and keep their critical information safe. This approach enables business owners to stay focused on their core competencies, instead of trying to understand the complexities of IT networks. There are five critical areas where Net Activity leverages their proactive approach to enhance security.

  • Anti-virus/Anti-malware.Most viruses spread so fast because they are delivered in the simplest ways. Viruses are usually deployed through email, software downloads or phishing sites. Net Activity provides regularly updates virus protection so the latest threats can be combatted.
  • Data Backup. If you’ve ever lost your data, your presentation or a file went missing, you’ve felt the sting of a lacking data backup program. While most businesses have partial backups in place, Net Activity provides companies with cloud based business continuity and disaster recovery programs in order to eliminate this problem from their IT landscape.
  • Software Updates.If you’ve ever snoozed a security update, you’ve potentially put your company at risk for greater harm. Net Activity team of technicians work around the clock to instantaneously and continuously update software so customers are always on the latest version.
  • Unauthorized Users. Keeping unauthorized users out – of buildings, software programs and internal networks – is another vital component for a comprehensive data protection program. Leaving these areas unprotected is irresponsible as leaving your doors unlocked at night. Net Activity monitors activity constantly and works with customers to provide access to necessary employees.
  • Cloud & Mobile Security. Virtually every business in today’s marketplace relies on some form of cloud-based technology or mobile phones. Each one of these pose a potential threat to the network and create vulnerability for the network, especially if left ignored. Net Activity monitors personal devices to protect against threats entering the network taking mobile security and cyber security to another level.

 “When an organization takes the time to assess these areas of their business, it’s very easy to dramatically improve the health of their technology,” said Harry Bhatia, President/CEO of Net Activity. “We are very well versed in these areas and can bring years of expertise and experience to the table. The modern organization can simply not afford to ignore these areas of their business any longer and by partnering with us we can prevent a catastrophic event.”

ABOUT NET ACTIVITY, INC.

 Net Activity, Inc. is a business-oriented computer & telephone communication company. It is our mission to make our clients business more efficient using our technology services.

Our Services include: Computer Services, Support, Disaster Recovery Services, Firewall Security Services, New Installs /Upgrades, VOIP Services, and Cloud Services.

With locations in Cleveland & Columbus we support clients nationwide. We are looking forward to support you with your business needs.

For more information on Net Activity, Inc. call (216) 503-5150 ext 206, or email info@NetActivity.us.

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