5 Ways To Compute Cloud Computing ROI

5 Ways To Compute Cloud Computing ROI

Cloud computing is quickly becoming a standard for business organizations, big or small. Everywhere you look in the industry cloud computing is being praised as the go to solution for companies trying to save money on IT costs and leverage their business processes to increase profits and probably save time too. But it is seldom shown how cloud computing benefits companies in terms of return on investment (ROI).

Well let us explore some ways to calculate ROI from cloud computing and maybe convince more people to consider this new computing paradigm. Cloud computing may give returns in the following areas:

  • Cost savings. Due to its nature of paying only for what you are using and not the cost of the whole system like in a traditional network hosting model.
  • Production Enhancement. This is mainly brought about by applications that enhance the business processes through efficiency and optimization. Another reason is that these applications are consumed through web browsers which even older computers can run without problems compared to installed applications which may need more computing power.

Aspects for Calculating Returns

Now, to calculate returns from cloud computing you do not employ your typical accounting calculations as most of the benefits of cloud computing can be seen in the long run and much of it is intangible. Different opinions differ on how ROI should be calculated but it is obvious that most of them have good points, and depending your organization, you find one calculation favorable than the other. Despite that, let’s look at five ways to calculate ROI from cloud computing.

1. Cost savings and rate of adaption. By reducing costs brought about by delays in decision and quick transitioning to new capabilities to keep up with market trends, organizations can rapidly improve the standing of their company against the competition which brings about more revenue quicker and gives them a chance to grab important market share.

2. Total cost of ownership. Because of a virtually non-existent barrier to entry and low technical skill requirement, cloud computing ensures that even non-IT staff can configure and run infrastructure and applications suited for the organization’s needs. This includes savings through labor and expertise cost, maintenance costs, and of course installation costs.

3. Rapid and dynamic provisioning of resources. Often when an organization grows or transitions, it demands more man power and equipment and this can take weeks to months including the training of new personnel and this could affect the business as this is down time. Cloud computing allows for the rapid provisioning of resources to scale to the growth or reduction eliminating the need for new equipment or decommissioning of no longer needed ones. And with the easy to use applications, this ensures that it is easy to train new or transitioned employees minimizing down time to mere days and ensuring that the new department or business unit becomes productive very quickly.

4. Increased cost and margin control. Growth in revenue and opportunities allow companies to cater to new markets and widen their customer base for further growth and improvement. The scalability of cloud computing allows for the avoidance of under or over provisioning of IT services which always ensures enhanced capacity utilization and avoidance of waste.

5. Process improvement. Through on demand solutions and shared services, organizations can capitalize on the development of new skills and solutions. This leads to better business processes which in turn ensure that the organization is lean enough to adapt to market changes and even see them as new opportunities for growth.

Conclusion

Though not every organization may calculate their ROI using these exact same methods, but you can bet it is still along these lines. But as you can see, it is harder to quantify the returns of cloud computing as most of these are in regards of time, efficiency, and reducing down time. Even though these are intangible, the ROI that cloud computing brings can be very considerable.

By Abdul Salam

Sorry, comments are closed for this post.

Comic
Are Cloud Solutions Secure Enough Out-of-the-box?

Are Cloud Solutions Secure Enough Out-of-the-box?

Out-of-the-box Cloud Solutions Although people may argue that data is not safe in the Cloud because using cloud infrastructure requires trusting another party to look after mission critical data, cloud services actually are more secure than legacy systems. In fact, a recent study on the state of cloud security in the enterprise market revealed that…

Connecting With Customers In The Cloud

Connecting With Customers In The Cloud

Customers in the Cloud Global enterprises in every industry are increasingly turning to cloud-based innovators like Salesforce, ServiceNow, WorkDay and Aria, to handle critical systems like billing, IT services, HCM and CRM. One need look no further than Salesforce’s and Amazon’s most recent earnings report, to see this indeed is not a passing fad, but…

THE FUTURE OF BIG DATA AND DNS ANALYTICS

THE FUTURE OF BIG DATA AND DNS ANALYTICS

Big Data and DNS Analytics Big Data is revolutionizing the way admins manage their DNS traffic. New management platforms are combining historical data with advanced analytics to inform admins about possible performance degradation in their networks. Not only that, but they also have the ability to suggest ways to optimize network configurations for faster routing.…

The Cancer Moonshot: Collaboration Is Key

The Cancer Moonshot: Collaboration Is Key

Cancer Moonshot In his final State of the Union address in January 2016, President Obama announced a new American “moonshot” effort: finding a cure for cancer. The term “moonshot” comes from one of America’s greatest achievements, the moon landing. If the scientific community can achieve that kind of feat, then surely it can rally around…

Multi-Cloud Integration Has Arrived

Multi-Cloud Integration Has Arrived

Multi-Cloud Integration Speed, flexibility, and innovation require multiple cloud services As businesses seek new paths to innovation, racing to market with new features and products, cloud services continue to grow in popularity. According to Gartner, 88% of total compute will be cloud-based by 2020, leaving just 12% on premise. Flexibility remains a key consideration, and…

Digital Transformation: Not Just For Large Enterprises Anymore

Digital Transformation: Not Just For Large Enterprises Anymore

Digital Transformation Digital transformation is the acceleration of business activities, processes, and operational models to fully embrace the changes and opportunities of digital technologies. The concept is not new; we’ve been talking about it in one way or another for decades: paperless office, BYOD, user experience, consumerization of IT – all of these were stepping…

The Importance of Cloud Backups: Guarding Your Data Against Hackers

The Importance of Cloud Backups: Guarding Your Data Against Hackers

The Importance of Cloud Backups Cloud platforms have become a necessary part of modern business with the benefits far outweighing the risks. However, the risks are real and account for billions of dollars in losses across the globe per year. If you’ve been hacked, you’re not alone. Here are some other companies in the past…

Part 1 – Connected Vehicles: Paving The Way For IoT On Wheels

Part 1 – Connected Vehicles: Paving The Way For IoT On Wheels

Connected Vehicles From cars to combines, the IoT market potential of connected vehicles is so expansive that it will even eclipse that of the mobile phone. Connected personal vehicles will be the final link in a fully connected IoT ecosystem. This is an incredibly important moment to capitalize on given how much time people spend…

Cloud Computing Is Greener Than You Think

Cloud Computing Is Greener Than You Think

Cloud Computing Is Greener Than You Think Last week we touched upon how a project in Finland had blended two of the world’s most important industries, cloud computing and green technology, to produce a data centre that used nearby sea water to both cool their servers and heat local homes.  Despite such positive environmental projects, there…

Infographic: The Evolving Internet of Things

Infographic: The Evolving Internet of Things

Evolving Internet of Things  The Internet of Things, or IoT, a term devised in 1999 by British entrepreneur Kevin Ashton, represents the connection of physical devices, systems and services via the internet, and Gartner and Lucas Blake’s new infographic (below) explores the evolution of the IoT industry, investigating its potential impact across just about every…

How Your Startup Can Benefit From Cloud Computing And Growth Hacking

How Your Startup Can Benefit From Cloud Computing And Growth Hacking

Ambitious Startups An oft-quoted statistic, 50% of new businesses fail within five years. And the culling of startups is even more dramatic, with an estimated nine out of ten folding. But to quote Steve Jobs, “I’m convinced that about half of what separates the successful entrepreneurs from the non-successful ones is pure perseverance.” So while…

The Internet of Things – Redefining The Digital World As We Know It

The Internet of Things – Redefining The Digital World As We Know It

Redefining The Digital World According to Internet World Stats (June 30th, 2015), no fewer than 3.2 billion people across the world now use the internet in one way or another. This means an incredible amount of data sharing through the utilization of API’s, Cloud platforms and inevitably the world of connected Things. The Internet of Things is a…

The Industries That The Cloud Will Change The Most

The Industries That The Cloud Will Change The Most

The Industries That The Cloud Will Change The Most Cloud computing is rapidly revolutionizing the way we do business. Instead of being a blurry buzzword, it has become a facet of everyday life. Most people may not quite understand how the cloud works, but electricity is quite difficult to fathom as well. Anyway, regardless of…

The Business of Security: Avoiding Risks

The Business of Security: Avoiding Risks

The Business of Security Security is one of those IT concerns that aren’t problematic until disaster strikes. It might be tomorrow, it could be next week or next year. The fact is that poor security leaves businesses wide open for data loss and theft. News outlets just skim the surface, but hackers cost business up…

Expert Insights Into The Yahoo Breach

Expert Insights Into The Yahoo Breach

Yahoo Breach Latest reports suggest that the recent Yahoo! data breach may exceed 500 million records, with some sources implying millions more records penetrated, upping the total number of records stolen in various recent hacks to approximately 3.5 billion. CloudTweaks spoke to Kevin O’Brien, CEO of GreatHorn, for expert insight into this latest violation. GreatHorn…

Using Private Cloud Architecture For Multi-Tier Applications

Using Private Cloud Architecture For Multi-Tier Applications

Cloud Architecture These days, Multi-Tier Applications are the norm. From SharePoint’s front-end/back-end configuration, to LAMP-based websites using multiple servers to handle different functions, a multitude of apps require public and private-facing components to work in tandem. Placing these apps in entirely public-facing platforms and networks simplifies the process, but at the cost of security vulnerabilities. Locating everything…

Big Data’s Significant Role In Fintech

Big Data’s Significant Role In Fintech

Data Banking Fintech covers a range of financial fields such as retail banking, investments, and lending and thanks to the mobile and internet innovations of late is a thriving sector. Offering improvements which drive customer satisfaction and education in an area previously inscrutable and dictated by gigantic inflexible corporations, fintech is helping put the power…

Battle of the Clouds: Multi-Instance vs. Multi-Tenant

Battle of the Clouds: Multi-Instance vs. Multi-Tenant

Multi-Instance vs. Multi-Tenant The cloud is part of everything we do. It’s always there backing up our data, pictures, and videos. To many, the cloud is considered to be a newer technology. However, cloud services actually got their start in the late 90s when large companies used it as a way to centralize computing, storage,…

Infographic: 9 Things To Know About Business Intelligence (BI) Software

Infographic: 9 Things To Know About Business Intelligence (BI) Software

Business Intelligence (BI) Software  How does your company track its data? It’s a valuable resource—so much so that it’s known as Business Intelligence, or BI. But using it, integrating it into your daily processes, that can be significantly difficult. That’s why there’s software to help. But when it comes to software, there are lots of…