Cloud computing is slowly becoming the norm of today. Most, if not all businesses I work are into cloud computing. My Brisbane bookkeeping service company is cloud-based. I have thoroughly reviewed and assessed the effects of cloud computing to my business and with the services we are offering. The benefits greatly overwhelm the drawbacks. Click here for more details and discussion of cloud computing and its advantages to small businesses.
I strongly recommend cloud computing to my clients, my business associates and to my friends. But just before you take my word and jump right into a whole different realm of business processes, read on for the challenges and risks of bringing your business into the clouds.
- Data security and privacy
In essence, you are using somebody else’s storage to keep your business data. It is a lot similar to renting out one storage warehouse to store your goods. The cloud storage facility is much like a compound of warehouses, you rent one and other company’s rent the others. Just like the other renters, you and anybody you gave authorisation to will have access to your respective warehouses, but you rely entirely on the provider’s security for the safekeeping and security of your goods. While you still own the content of your warehouse, you are handing it over to the system provider for safe keeping.
Minimise, if not eliminate this risk by choosing service providers that use state-of-the-art security and data access controls. Data security is both users’ and provider’s responsibility. Anybody you gave access to your files should be thoroughly screened. Carefully read the service level agreement to know your obligations and options as well as the provider’s responsibilities.
- Environmental security
Cyberattacks! The most hated word in cloud computing. As a Brisbane bookkeeper, I am aware of the sensitivity and importance of any information that I upload to the cloud. Business applications are goldmines of information and data attracting thieves and scammers. Malware, bots and rogue software attacks are just some of the most common cyberattacks directed to systems and applications.
This is a manageable and preventable risk. Only use reputable service providers with track records of data security and safety. Do not use free services and lesser known start-ups without thoroughly reviewing the company first.
- Reliance on the internet
Once you adopt cloud computing for your business, you will eternally be relying on the internet for anything you need to do. Accounting, reporting and planning will have to be done online. You will not be able to access and work on your files during downtime and whenever you’re outside of internet network coverage area.
Downtime and system crashes are nothing extraordinary in the world of cloud computing. However, more established and stable providers have managed interruptions. Regular and scheduled housekeeping downtime designed to prevent these surprises are short and announced ahead of time. Mobile internet routers and Wi-Fi are now available. These will allow having internet connection from almost anywhere in the world.
- Data integration and compatibility
Systems and applications use different programs, languages and formats. This will become a challenge when you need to integrate data into one report. Sales, delivery, payments, banking and cash flow are just some of the business data coming from different sources that you need to integrate. While most can be downloaded and worked manually on, it defeats the purpose of cloud computing.
More advanced cloud computing apps are now compatible with most business applications. Xero, the accounting and bookkeeping system I’m using has even integrated other business apps like Paypal, Square, Vend, Shopify, Receipt Bank and WorkflowMax to name a few.
- Australian privacy laws and regulations
Businesses acquiring and storing sensitive personal and financial data are responsible for its safety and security. Australia’s Archives Act 1983 and the Privacy Act 1988 stipulate the responsibility of businesses acquiring important information. If the physical location of the servers or storage facility is outside of Australia, businesses will also need to know and observe the applicable laws and regulations of the host country.
Cloud computing is the future of business processes. Companies are going paperless and buyers are going online. More and more business processes and transactions are migrated online. Going to the clouds is no longer a fancy option, it is now a business necessity. It is now a business requirement to upgrade to the clouds. And as a conscientious businessman, it is always best to know all the angles to any commitment you are about to enter.
To know more about cloud computing – its benefits, challenges, risks and your options it is best to consult with a business professional. Your Brisbane bookkeeper could help you choose you best cloud computing system that will fit your business needs.