If you intend to innovate in your company, know that the changes provided by Cloud Computing, can favor several areas of these innovations.
Whether they are in need of creating a new business or improving traditional businesses, cloud computing was done to eliminate much of the large initial investment.
Whenever it is necessary to innovate in a company, the first area that the owners evaluate, even before verifying if it is possible to effect the changes is in relation to the investments for them to occur.
Before the cloud, it was necessary to make a large investment in technology infrastructure, so that only then could the new business model or its redesign be initiated.
Cloud Computing allows entrepreneurs to “venture” more into innovations, as technology reduces a large percentage of the risks in relation to initial investments.
With the reduction of almost 100% of these investments, there are not many economic risks if it does not succeed.
Only a small part or none will be lost as the cloud’s On Demand system allows you to only pay for what you use.
Success and innovations
With the success of innovation, Cloud Computing allows greater agility when increasing the demand for resources, being done almost instantly by Cloud companies such as Azure, AWS, Google Cloud and others.
In other times, this increase in resources, such as an increase in processing capacity, required a large investment, in addition to leaving the server used in the project “scrapped”.
Just hiring exactly what you need and no heavy investment in hardware, floor space, energy consumption and more will be a problem to expand your business.
The cost on Cloud platforms always adjust to the demands, there is no need to worry about paying for something you are not using. However, a good technology (IT) team is needed to define the best strategies for your type of business.
The cloud and the economy of scale
All the technological resources of the cloud generate economies of scale for your company, as they are generally shared, where the entire organization of processes, failures, investments, excessive expenses are exclusively a problem of the cloud supplier and not yours.
Resource sharing generates savings that would not be possible if applications were run on their own or outsourced infrastructures.
The concept of economy of scale in general is geared to the organization of the production process, where all the items that are part of this process are used in the best possible way, causing expenses to decrease along the entire production “line”. .
If the provider of your cloud services is organized and invests in the area, the trend is that over time your costs may decrease further.
As an example, we can mention the evolution of hardware, where if your current need is 2tb of storage, with the advancement of technology, if in the future your need is still 2tb, the values tend to fall because it is something that requires less of the Supplier.
Economies of scale at the supplier
In the cloud, all the economies of scale that happen at the supplier are passed on to the receiver. That is, if they save, the trend is that you will also save.
The greater the number of customers, the greater the need for suppliers. This great demand ends up generating a better negotiation to acquire the necessary equipment so that everything works correctly.
When there is a high demand for investment from the supplier, the value is diluted among the entire customer base. The higher this number, the less the impact on the final consumer.
Example: If your company had a data center and in order to expand your business it was necessary to acquire more processing capacity, the total cost of this investment would be yours alone. In the cloud, the investment can be divided between new and old customers of the supplier.
Economies of scale at the client
Cloud economies of scale can also be applied to the end consumer side. After all, the On Demand system allows customers to use only what is necessary, preventing costs for unused resources from being borne by the contractor.
The average use of servers by the customer is much higher than in other exclusive options.
In this form of use, the times that most require processing capacity are those that will be focused on by the supplier.
The processing target at these times is greater than at idle periods. For example, your company needs a high demand for resources during business hours, but in the early morning the usage is practically zero.
On dedicated servers, you pay for both consumption during business hours and in the idle period.
In cloud computing, when a server is idle it is allocated to another application, providing the need for another client.
So in a fairer way, when you are not making use of the full capacity of services, they are not charged and are directed to others.
In Cloud Computing, you only pay for what you use.