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LEAD Innovation Blog

Read our latest articles on innovation management and innovation in a wide range of industries.

Date: 03-Mar-2020
Posted by: Julian Eberling

What should you know about cloud computing?

The IT requirements of a business today are high and continue to rise. In the meantime, many companies are already seeking their salvation in the cloud. This article gives you an insight into cloud computing and points out the most important advantages and disadvantages.

Cloud computing is one of the technologies that drive digitalization. It allows a user to use a variety of services from a network cloud provided by a service provider. The user can access these services via various interfaces or programs, such as a web browser. All they need is a network connection and a digital device such as a laptop, tablet, or smartphone.

Cloud services are now also available in smartwatches, intelligent loudspeakers such as Amazon Echo and in vehicles. Virtual assistants such as Alexa, Google Assistant, Cortana, or Siri are capable of voice interaction and control of smart devices. In a nutshell: Cloud computing makes it possible to use resources from almost anywhere and in every conceivable situation. 

Running own IT systems is too complex for many companies

The development and operation of the company's own IT infrastructure or the installation of local software are not necessary and make hardly any sense. The complexity of these tasks causes additional costs and requires experts who are currently difficult to find on the job market. As the threats from the net are continually increasing, IT security is becoming a central aspect of the IT infrastructure. Should a company operate its IT independently, it will need a high level of expertise in IT security. 

What do IaaS, PaaS, FaaS und SaaS mean?

However, most companies want to focus on their core competence and not on IT. With cloud computing, a company pays explicitly for the services it needs. Moreover, it can be sure that thanks to service level agreements, the service provider will adjust the services to client's needs and desired form. However, what services and resources are we talking about? This is where the four abbreviations IaaS, PaaS, FaaS, and SaaS come into play: 

1) Infrastructure as a Service

With IaaS, the user obtains storage space and computing power from the IT infrastructure of the service provider. Pure and simple, the user has a computer that is not physically with him, but that he can configure the way he wants to use it. The user can now use this IT infrastructure to operate his software. However, it is the user's responsibility to ensure that this works - after all, it comes from him. The service provider only secures that this virtual computer does not fail. 

2) Platform as a Service

PaaS gives the user access to a programming environment in the cloud so that they can develop their own apps there and make them available to the public. The service provider makes sure that the application runs stable - no matter whether it is used by only one user or by millions. This form of cloud computing is particularly suitable for the development of Internet of Things applications. 

3) Function as a Service

FaaS is very similar to the PaaS model. However, instead of programming and running an entire app on the service provider's IT infrastructure, the user simply uses individual functions for his application. The user only pays for the features he uses without knowing which infrastructure the provider uses to run the app. Thus, FaaS and PaaS are often referred to as serverless computing. 

4) Software as a Service

In SaaS, the software comes from the network. The service provider is responsible for the operation and authentication of the software. SaaS solutions are prevalent; there are many examples, such as Content Management Systems (WordPress) or office solutions (Microsoft Office 365 and G-Mail) that work according to the SaaS model. 


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The three key benefits of cloud computing

1) Flexible IT costs

With any form of cloud computing, a company only pays for the resources and services it actually uses. The situation is different when it comes to operating its own IT. The company initially has to make high investments in hardware and software without knowing whether the IT performance is too high or too low. Own IT infrastructure is a big problem, especially for start-ups who would have to struggle with high investments before getting started. Thus, cloud computing offers much flexibility and minimizes the initial costs significantly.

2) The latest technologies can be used

Without cloud computing, many companies would not be able to afford some technologies. Artificial intelligence, for example, requires very high computing resources that are only available in a server farm. Thanks to cloud computing, AI virtually comes out of the socket as providers can obtain this technology via networks for specific user applications. The user can always be sure that the service provider is using the latest hardware and software conforming to increasing IT security measures.

3) IT works immediately, securely and everywhere

To set up a computer for a new worker, the IT department needs one day on average. Cloud services, on the other hand, can be deployed immediately. The necessary registration and administration are usually so simple that no employee of the IT department has to be bothered with it. Another significant advantage is the accessibility of the services from anywhere - for example, during a car journey by voice command

Cloud computing also has downsides

Until a few years ago, the traditional approach was still prevalent: an entrepreneur buys the software license and operates it on hardware at his own responsibility. A so-called On-Premises, compared to cloud computing, has  the advantage of not having to outsource any data and allows retaining full control over IT. If, for example, the service provider's technology goes on strike, the user's service also collapses - just as has happened with Google and Snapchat

Conclusion: What You Should Know About Cloud Computing

Without cloud computing, many companies would not be able to implement new technologies due to a lack of financial resources. Cloud computing makes it easy and affordable to use the tools to drive digitalization. Simplifying, a company leaves its entire IT to a partner who has a much better command of it. However, the price that companies pay for it is high as they have to outsource different types of data as well as control over the IT. Thus, every company should take a close look at its cloud computing partner before implementing cloud solutions.


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Julian Eberling

Born in Vienna. Since 2018 "Certified Service Design Thinker" he has been pursuing his passion as Innovation Manager at LEAD Innovation.

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