Signing up for cloud applications is simple. Many cloud services are free or low cost and allow customers to pull out of the service at any stage. The service is delivered through a web browser and is usually available for a monthly fee, with no lock-in contracts.

The most commonly used cloud applications in the industry are email services such as Gmail, Hotmail and iCloud. The most commonly used business management cloud services for the industry are TradifysimPRO, simTRAC, GroundPlan, GeoOPMicrosoft Office 365, Xero, Google Drive, Microsoft OneDrive and Dropbox. Every vendor has a different approach and fee structure. As with any business agreement, be sure to check the details before you commit.

As with any new technology, there can be risks associated with cloud computing. Decisions on risks have to be made after understanding the issues clearly. Only then should a business put the control into the hands of a vendor or IT services company.

The following items should be considered before entering into a cloud computing contract.

Planning for “Business as Usual”
Data Location
Legal Issues
Performance
Privacy and Security
Vendor Lock-in

Planning for “Business as Usual”


Any internet disconnection will interrupt cloud services. This many not be the fault of the cloud service provider and could be a problem with the telecommunication service. Consider having accounts with more than one telecommunications provider, to ensure connectivity should one service not be available. Because data and information can be stored on servers anywhere in the world, it may also prove difficult or even impossible to retrieve data in the event of a disaster. So consideration should be focused on services being delivered from a known location, with appropriate guarantees on service delivery, backup, data retrieval and security. If you lost all your data, could your business continue as usual? Connection and backup are the two main issues to manage to ensure business as usual.

Tips for the electrical industry

Have accounts with more than one telecommunications provider

With any application that requires an internet connection, it is good practice to consider a secondary telecommunications account in the case of a service drop out from your primary provider. A small USB toggle could provide relief in the instance your service is removed, and can save on lost time and income if you rely on cloud based services.

Backup, backup, backup

If you’re storing data or files in the cloud, it is always a good idea to create a regular system for backing up your files. Talk to your IT provider about working this into your daily service, or better yet, regularly back up sensitive or often used documents on a personal hard drive.

Data Location


Where is your data? Does it matter if you don’t know the answer? Does it matter if your data is stored with other data on the same server? If your data is stored overseas, would that matter to your customers, your board of directors or your suppliers? You should know the answers to these questions, discuss them with your IT service, accountant and lawyer and be comfortable with the answers.

Legal Issues


Data and information stored and shared within a nation’s boundaries falls under the country’s legal and regulatory framework. If data is stored elsewhere, this could create problems. This may not be a problem for a small business, but could have privacy ramifications for larger Australian businesses. There is also the issue of data retrieval in the event of a systems disaster under a foreign legislative framework.

Performance


Most people skim software agreements and agree to terms without much consideration, especially when the cost and risk are small. The more important the software application is to business continuity, the more important it is to have guarantees and service level agreements in place. Agreements should cover security, reliability, data recovery, backup, performance levels, application modification, development and integration, monitoring and reporting, archiving and regulatory regime.

Privacy and Security


Any data stored outside of your business premises is accessible to third parties, no matter what the level of service guarantees. No environment is fully secure. Risks should be assessed sensibly. Vendors should be measured against the provisions of the Privacy Act 1988, with includes amendments commencing 12 March 2014. It’s important to remember that with cloud services, data security is managed by the vendor, not by the organisation receiving the service. So check as far as possible what security measures the vendor has in place.

Vendor Lock-in


Open standards and interoperability (the ability for making systems work together) reduce the risk of being locked into a specific vendor (otherwise known as vendor lock-in). But many applications are now being delivered from proprietary platforms and devices. So if that vendor suddenly goes out of business, do you have other options to turn to? This may not be an issue, but once again, the more important an application is to business continuity, the more consideration should be given to the risks.

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