Corporate cloud: why it is a cornerstone of digital transformation

Corporate cloud means a company runs its data, systems and applications on a provider's infrastructure instead of its own servers. It pays only for the resources it actually uses, can scale capacity within hours and can access its systems from anywhere. It is one of the central aspects of the digital transformation that most businesses will have to go through over the coming years. What advantages can moving to the cloud bring a company, and how are companies that have already made this move doing?

What is a corporate cloud

A corporate cloud is a model in which a company does not buy its own servers but instead rents computing power, storage and software from a provider. Billing is based on actual usage, and capacity can be added or reduced at any time.

The difference from running your own server room lies mainly in who carries the risk. With your own hardware, you pay for capacity upfront and deal with any failure yourself. In the cloud, you pay on an ongoing basis, and the provider is responsible for availability. Depending on where the data is held, a distinction is made between public, private and hybrid cloud.

Cloud as the future of business

Digital transformation and the digitalisation of companies are a response to shifts in the market and in customer expectations driven by the massive development of information and communication technology products. The expansion and affordability of certain services create room for smaller businesses and startups to gain a foothold too, which in turn leads to ever-increasing competition.

With a degree of exaggeration, it could be said that any given day might see the emergence of a project that suddenly threatens a company's previously stable position on the market. It is therefore important not to underestimate the strategy for a company's further growth and the implementation of innovative solutions such as artificial intelligence (AI) and others.

The cloud is one of the fundamental building blocks on which the whole of digital transformation rests. It creates room for modernising existing systems without the need for heavy capital investment, and it brings technology and performance that small and medium-sized companies previously could not, in most cases, afford.

Moving from local infrastructure to the cloud is a developmental stage that most companies will have to go through in order to stay competitive. The sooner you embark on the cloud (and on digital transformation in general), the more likely you are to build a lead that can have a fundamental impact on the company's future direction.

Cloud for corporations, but also for small and medium-sized businesses

We have most likely all already come across the cloud in the course of our working or personal lives. It is used by social networks such as LinkedIn, X and Facebook, for example to power chat. It can also be found in other communication platforms such as WhatsApp and Skype. The scalability of the cloud is likewise used by streaming services, including Netflix among others.

It does not, however, always have to be an international product or a corporation. As already mentioned, a corporate cloud is also useful for small and medium-sized businesses. This generally comes down to three layers:

• IaaS (Infrastructure as a Service) – renting servers and storage as part of building infrastructure. The company runs its own systems on them.

• PaaS (Platform as a Service) – an environment intended mainly for application developers. The company does not have to worry about the infrastructure.

• SaaS (Software as a Service) – a ready-made application for end users that you simply log in to. This includes Microsoft 365 or Google Workspace.

In all cases, moving to a cloud architecture brings efficient use of hardware resources, availability from anywhere with an internet connection, and remote support.

Why move a company to the cloud

The preceding paragraphs have already mentioned one of the main advantages of the cloud, namely scalability. A corporate cloud can therefore serve as a means of integrating other technology trends, which besides AI also include machine learning and IoT (the Internet of Things).

AI combined with the cloud offers access to virtually unlimited computing power, which can be used, for example, for analysing so-called "big data", i.e. large volumes of internal and external data that make it easier to plan a company's future strategy or to build a picture of customer requirements and marketing strategy.

Each company decides for itself how many resources it needs and pays only for what it actually uses. A corporate cloud thus offers the option of responding to a seasonal increase in demand on an e-shop within a matter of days, sometimes even hours. Likewise, nothing stands in the way of further business growth, which in the past would have required overhauling the entire local infrastructure.

The cloud is therefore a solution for implementing a whole range of innovations, such as integrating a chatbot into a website, e-shop or web application.

Moving to the cloud also removes the need for long-term investment in the IT sector in the form of buying your own servers or funding staff to manage them. This reduces the capital investment required and shifts costs into operating expenses instead.

Corporate cloud in practice: how are companies that have made the move doing

The cloud and digital transformation, or the digitalisation of business, have been talked about for some time as the future of business, which raises the question of whether their integration really delivers the desired result. There is no, and cannot be, a completely clear-cut answer, since the design and specific implementation of the cloud depends directly on the conditions and staff of the given company.

Nevertheless, the benefits of the cloud in business have been the subject of numerous surveys and studies, both domestic and international. The results of these analyses identify a certain lack of awareness among staff as one of the biggest problems, as they are not used to handling modern technology and are unable to operate it efficiently enough.

The following figures come from surveys available at the time this article was written in 2020 and describe the start of the wave of companies moving to the cloud.

This is illustrated, for example, by a survey by Veeam, in which 44% of respondents identified this as a problem. The second key obstacle is the issue of outdated technology, which slows down a comprehensive move to the cloud. This factor was encountered by 40% of those surveyed.

In its survey, Accenture focused on the level of satisfaction and expected results of moving to the cloud. After some time operating with a cloud solution, most respondents (96%) find its implementation beneficial. However, only a third of them are satisfied with the extent of that benefit.

More than 50% of respondents have therefore not yet seen the expected results in full. However, only 11% expressed dissatisfaction with the planned financial savings. The hybrid cloud proved the most popular (50%), followed by the public cloud (47%) and finally the private cloud (35%).

As with other new technologies, all the benefits of using a corporate cloud only become apparent after some time. The lesson from these figures still holds true today: simply moving data over will not, on its own, bring any benefit. Management should not neglect staff training so that employees can make effective use of the new resources, and should also choose the right partner to help them with the move into the online world.

Advantages and disadvantages of cloud computing

Corporate cloud and its advantages:

• payment only for resources actually used,

• automatic backups (several copies of data across multiple data centres worldwide),

• platform independence,

• shared computing technology,

• optimised operations,

• a security team from the provider that a smaller company couldn't afford on its own,

• lower likelihood of internal system downtime.

The biggest disadvantage, and also the reason why many companies still hesitate to move to the cloud, is data security. When using cloud services, data is stored outside the company, on the provider's remote servers, and its privacy may not always be fully guaranteed.

This is an issue that has been discussed in connection with cloud computing since the trend began, and a range of solutions now exist to ensure security. Even today, however, it's important to carefully choose a provider that takes care of security on your behalf. Among the largest, we can mention Amazon and AWS, Google Cloud or Microsoft's Azure.

A second disadvantage could be considered a certain dependence on an internet connection, which is partly addressed by offline availability and offset by independence from platform and location. This means the company's software and data can be accessed from a computer, mobile phone or tablet, practically from anywhere.

A third thing worth thinking about in advance is rising operating costs. If usage isn't monitored, the monthly bill can be surprising, since you pay for actual consumption. Related to this is dependence on a single provider: the deeper you integrate its specific services, the more expensive it becomes to switch elsewhere.

Getting started with corporate cloud

Moving to online operations doesn't have to mean shifting the entire infrastructure at once. A comprehensive corporate cloud can be built up in small steps:

• Email and calendar – the simplest first step, for example Exchange Online, Gmail or Microsoft 365.

• Shared storage and documents – eliminates emailing attachments and file versions scattered across drives.

• Communication platform – a company chat tool instead of email threads.

• Office applications – for example iWork or Office 365.

• Internal systems – gradually migrating the applications where cloud makes the most sense.

To maximise efficiency, however, it's important to follow the rule of connecting services and systems, which should be able to communicate with each other through an API. This point is the one most often underestimated, yet it's the most important one: cloud services that don't communicate with each other will only mean you're retyping data manually somewhere else instead.

Frequently asked questions

What is corporate cloud? A model in which a company runs its data, systems and applications on a provider's infrastructure instead of its own servers, paying only for the resources actually used.

What's the difference between IaaS, PaaS and SaaS? IaaS is the rental of servers and storage, PaaS is an environment for developing and running applications, and SaaS is a ready-made application you simply log into.

Is the cloud secure? Large providers have a security team that a smaller company couldn't afford on its own. The risk shifts elsewhere: to choosing the provider, setting up access permissions, and contractually addressing where the data is located.

Is the cloud cheaper than owning your own servers? Not always. You avoid investing in hardware and its management, but operating costs rise with usage. For a stable, predictable workload, owning hardware can work out cheaper.

How long does moving to the cloud take? The first step, email and documents, takes days to weeks. Migrating internal systems is measured in months and depends largely on how interconnected they are.

What is vendor lock-in? Dependence on a single provider. The more of its specific services you use, the more expensive it becomes to switch elsewhere.

Summary

• Corporate cloud means renting computing power, storage and software instead of buying your own servers.

• The main benefit isn't cost savings but flexibility – you can change capacity within hours.

• The biggest obstacle usually isn't technology, but people and processes.

• Start with email and documents, not by moving the entire infrastructure at once.

• Connecting services via API is key. Without it, the cloud just shifts manual work elsewhere.

If you're planning to set up a corporate cloud, feel free to take advantage of our free consultation, where we can work together to prepare a solution tailored to your business.