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Infrastructure as a Service Turns Heads As Midmarket Cloud Ambitions Grow

As the business world quickly migrates to the cloud for technology applications and infrastructure, many middle-market organizations have been slow to adapt. Some are slightly apprehensive about the cloud, amid uncertainties about whether systems are a good fit and concerns about vulnerabilities and resources required. However, the reality is the cloud presents several key benefits, including increased agility, efficiency and security, typically with lower costs and less resource utilization.

The cloud is an avenue to develop a competitive advantage, and middle-market businesses can’t afford to lag behind. Infrastructure as a Service (IaaS) solutions are ideal to enhance operations without the burden of buying, managing and maintaining equipment. IaaS is inherently flexible and can be leveraged from an incremental standpoint to build a custom solution that introduces an organization to the cloud or a comprehensive cloud platform.

In its 2013 Public Cloud Services Forecast Overview, Gartner projected a 17.7 percent growth rate for public cloud services through 2016, with IaaS experiencing explosive growth at a 41.3 percent rate over the same time period.[1] The reasons for this projected growth are numerous.

When organizations think about moving to the cloud, many envision starting over; however, a key reason IaaS is attractive is that it can be an extension of an existing technology environment. Technology implementations are daunting, but IaaS can connect with existing systems and work together to create a more efficient and effective platform.

For example, when an organization upgrades their financial accounting or enterprise resource planning (ERP) system, requirements may not align with existing data center capabilities. Traditionally, organizations make significant capital investments to buy more servers and storage and attempt to forecast needs years into the future to avoid repeating the process prematurely. With IaaS, organizations don’t need to be concerned with future usage and requirements, only current needs, as additional capabilities can be added simply without rebuilding or forklifting the solution.

Companies only pay for the resources they need, and additional servers, storage or memory can be added very quickly, potentially the same day. As the business grows, more resources can be acquired on an as-needed basis, instead of paying for them years in advance with a traditional on-premise solution.

Organizations worry about a transition period when moving to the cloud, but usage and support are very similar to on-premise solutions. End users should not notice any difference in how they use systems, other than improved availability and performance. IaaS is much more than just a server component, with available add-ons, including storage, backup, disaster recovery, voice communication and firewalls, each as service options. IaaS provides capabilities that have been traditionally out of reach to most companies due to complexity or cost, including fully redundant power and Internet, and advanced monitoring, management and security.

IaaS is an agile platform, allowing organizations to become more efficient by increasing or decreasing resources much faster than on-premise solutions. Systems can be adjusted in minutes as opposed to days in situations such as increased seasonal demand or staffing changes. Additionally, organizational requirements may go beyond just actual storage space, to storage performance. With an on-premise investment, upgrading performance may be daunting, but in a service model, storage can be added and performance adjusted nearly on demand.

Some organizations may feel cloud solutions are not as secure as on-premise platforms; however, IaaS providers typically have more resources available for you to take advantage of, coupled with their need to secure the overall environment. A security solution might be easy to implement in an on-premise atmosphere, but much more difficult to maintain.

Compliance measures are also easier to reach with IaaS, as best practices and certified deployment standards develop a strong regulatory foundation. Be wary though, as many necessary regulatory requirements aren’t achieved simply by moving to the cloud. They still need to be achieved, but with the right IaaS provider, you’re that much closer.

Middle-market businesses have several options for IaaS providers with varying levels of customization. Large technology companies, such as Microsoft and Amazon, offer solutions with an economy of scale that frequently provides a lower price point for some commodity-based IaaS features. However, companies may benefit from working with a smaller provider with more customized, less rigid solutions. Ultimately, production level workloads often require customized and dynamic solutions, and services-oriented organizations are much more geared to providing those than larger providers. The economies of scale may not be as great, but the value may ultimately be greater.

An effective IaaS platform provides several advantages, and with the solution’s rapid growth, middle-market organizations can’t afford to sit on the sidelines. If you are not leveraging the cloud and IaaS, now is the time to discover what services make sense for your organization and how they can enhance your business.

 [1] “Forecast Overview: Public Cloud Services, Worldwide, 2011-2016, 4Q12 Update,” Gartner, accessed August 8, 2014, https://www.gartner.com/doc/2332215/forecast-overview-public-cloud-services.

aaronAaron Donaldson is a Principal of McGladrey LLP’s Technology Consulting practice. Aaron is responsible for the information technology consulting areas of the Mason City and Des Moines, Iowa offices, as well as the Minneapolis, Minnesota and Sioux Falls, South Dakota offices. In addition to his geographical responsibilities, he also leads up our Managed Services division (IT-Vision) and participates with our Cloud Solutions team. He specializes in network design, assessment and implementation, as well as business continuity project management, and Web site development.

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