‘Cloud computing’. What an awful, vacuous term. Computer usage with clouds. Even the average IT professional – never mind the average SMB owner – feels how intangible those words are and can’t make heads of tails of them. You can try it yourself the next time you run into some computer whizz. Ask them to give you a comprehensive definition of ‘the cloud’, without taking a long time to think about it. If they can do it, the person you asked is probably a teacher, or someone else who could do a teacher’s job without effort.

It’s not the first time something like this happens: developments in society give rise to new terms that aren’t immediately given a clear definition, and it can take years or even decades for them to get one. The term ‘cloud’ in relation to computers probably first showed up during the nineties, and has been fleshed out more during the last few decades. By now it’s become an umbrella term for the storage and processing of information on multiple computers that are not locally present but are somewhere else: on the internet (a public cloud) or a closed-off network (a private cloud). What developments have led to the cloud? What possibilities does the cloud offer for entrepreneurs? And isn’t it a dangerous place up there in the clouds?

Not here, but there: in the cloud

Ten years ago, you would still need to install an application to your desktop or notebook computer for everything you wanted it to do, and the data those applications generated needed to be stored locally on the hard drive. For small businesses, that meant computers were shared with multiple staff members and data was exchanged regularly using floppy disks and burned CD-ROMs. If a company grew larger, it was time to install one or more ‘servers’: computers whose only purpose was to store data in one place, and, using a wired network, connect it to the users. The server and the network required frequent maintenance and came with expensive licenses. 

Fortunately, networks have become wireless and we increasingly store data not locally, but on the internet. That means dozens of servers are a thing of the past now, and are now usually found only at larger companies, along with a small army of IT professionals or even one or more IT departments. They still feel the pain of expensive licenses, broken hardware and being on call round-the-clock to come solve problems at any time of the day.

With the introduction of faster, cheaper internet connections and more and more online services like Gmail, Exact Online and Moneybird, we’ve ended up installing less and less software onto our computers, and have instead started using our internet browsers as a gateway to online applications. That way users don’t have to worry about installing updates – the service provider takes care of that – or about storing and sharing data: just log in and you can get going right away! 

No constant backing-up, but one continuous backup

Until recently, making back-ups was a notorious source of headaches and often went wrong as a result: corrupted backups, forgetting to make backups, backups being stolen. Since the prices of data storage and of a fast internet connection have become so cheap, there’s nothing to stop us from frequently making a copy any more, online – using Dropbox for example, or Time Capsule (by Apple) or Google Drive – and of course offline as well, on an external hard drive. What’s more, during the last decade it’s also become a common practice to make backups in real time: not just once a week any more, but all the time. Working in the cloud usually means your data is stored and backed up in several places, at the same time, which benefits its availability. But be careful and ask your provider about this, and always make your own backups regularly too.

One additional advantage to working in the cloud is the fact that the information is always available from anywhere and often from more than one type of device: you can also access it from your mobile phone, your tablet and in the future probably your smartwatch, smartglasses and (semi-)driverless car. The downside can be that one minor malfunction on the part of the provider could mean you can’t do any more work… Make sure you always have a plan B for very important processes and print out a hard copy of important documents to keep safe in an offline vault.

Reduced expenses

Since online applications no longer need to be installed onto the computers of each of the users, but only on one network owned by the provider – which is also where all the data is stored – the larger scale means their usage takes only a fraction of the cost. On top of that, the users can save money because they need less (major) investments in hardware: for more and more things, a simple laptop is all they need.

A more transparent range of options

Entrepreneurs will want to use the cloud to get less administrative work, higher productivity, less expenses and new tools to generate more revenue. Individual internet users want extensions of their social lives, and ways to use their time more efficiently and effectively. What’s great is that all the available solutions present themselves on the internet, which acts like a giant marketplace, creating relentless competition. That’s why many service providers offer a free trial, or even completely free usage — supported by advertisements or otherwise. Make sure in that case that your privacy is kept safe, that your data remains yours and that you could easily switch to a different provider.

Big data still small data for now 

Despite an explosion of new online solutions, this new development still has a lot of growing up to do, and most solutions for SMB’s are still somewhat ‘dumb’. They replace offline tasks and do what you ask of them, but they don’t automatically add something new — your old paper agenda now shows up on your screen, but doesn’t also calculate at what time you should leave in order to reach your appointment on time given the latest traffic reports; an invoice application that ‘knows’ you haven’t sent an invoice to a client in a while won’t automatically remind you to give them a call; a security camera by Dropcam that automatically processes footage on a cloud platform won’t automatically alert the fire brigade if your office is on fire. That sort of intelligent usage is the next step to be made by the cloud and the applications that use it.

‘Big data’ is going to be very useful and could help entrepreneurs compare their company to their competing colleagues’ – to benchmark it – and improve it based on knowledge distilled from analyses of other companies from the same sector. What did they do to raise their revenue and lower their expenses?

For the time being we shouldn’t expect too much in that area, though, because using ‘big data’ won’t be possible until we start using ‘small data’ in a good way, which is already a major problem to entrepreneurs and software developers. That might be for the best, though: in this impending era of big data, who will be the real CEO of the company? 

The Internet of Things: specialist platforms

The problem with big data is also simply that it’s just too much data. There aren’t many people on earth who have the creativity and the mathematical know-how to take gigantic amounts of data and do something useful with them, and that’s only going to become a bigger problem in the future. With the introduction of the ‘internet of things’, the development where more and more appliances are equipped with an internet connection and can be linked to a cloud platform, the amount of available data will continue to grow exponentially. As an entrepreneur, you should ask yourself what available and attainable data really helps you to be a better entrepreneur. That’s why we’ll also see more and more specialised clouds: a few general ones will remain (Google, Amazon, Facebook) and there will be more and more ones adapted to specific tasks. 

Online identity

Something else that’s becoming a greater and greater challenge is managing our online identity. We create more and more accounts on the internet and – knowingly and unknowingly – leave more and more traces. The exponential growth of these things will lead to being faced more and more often with information we didn’t intend to leave behind, but also information we need to manage. For that too, no good solutions have been found yet.

Bring your own data

The term ‘company phone’ has fallen out of use in recent years, now that consumer phones like the iPhone have outcompeted the slower, less interesting Blackberries — and employees have all started wanting to be able to use their own phones at work. ‘Bring your own device’ has become the new standard. It’s no longer the phones that connect companies, but the platforms. And for now it’s the platforms that manage the data we load onto our devices, but in the future we will bring data along ourselves too. Your iWatch tracks your heart rate, and your physician reads those data. Those are then added to the medical records which are then stored in the national patient registry: a private cloud.

Do companies benefit from it?

CEOs often ask me: can we use the cloud to improve our organisation? My answer is always the same: no, you can only use the cloud to create a nicer environment for your employees. Although the internet, social media and the cloud are wonderful solutions, we should never forget that they have to be able to support human labour. It happens all too often that new systems are decided on and implemented thoughtlessly. That doesn’t make employees more productive. No matter what solution you choose as a company in this new world, it’s important to let your own staff do it. And give them all the time and resources they need to get used to a new system. And if it doesn’t work, revert the change again as quickly as possible. 

Security?

The possibilities of the new internet are endless, but its threats are greater than ever. People who store information in the cloud often don’t know who can get to those data. Or where it’s physically stored. Or how well-protected it is. Or whether they make backups regularly. Or whether the service provider has a plan in case of (major) downtime. Or whether data is really destroyed if you press ‘delete’ somewhere (for a long time, Facebook didn’t delete ‘deleted’ photos from their network). Or whether there are any secret services with economic motives snooping around. It requires a very deliberate, critical attitude. Ask your service providers lots of questions. Look into things, and make sure you stay safely ahead. After all, the alternative – working without computers – isn’t a viable option any more either.