Strategies: Consider keeping your business in the 'clouds'

— -- The future of your small business is in the clouds. No, I'm not talking about daydreaming about floating on a cloud (personally, I daydream about floating in a pool in Hawaii), I mean having key business functions handled somewhere out there in the Web-based clouds of cyberspace. Increasingly, in my company, we're moving business services to the clouds, and I love it.

In fact, having your business functions Web-based, rather than computer-based, can be a great boon for your small business. It can save you money and aggravation, while giving you greater functionality.

You may already have heard the term "cloud computing." If not, you will soon. Nope, it's not some geeky tech term. All it means, as applied to your business, is having computer applications — such as payroll, accounting, sales management, document sharing, data backup, even word processing — hosted on Web-based services rather than on your desktop, laptop or server computers. Other terms used for the same thing include Web-based or online services, and SaaS, or software as a service.

If you use a Web-based e-mail program (such as yahoo mail, hotmail, gmail, aol), you're already familiar with cloud-based computing, even if you've never used that term. Your e-mail is stored on the Web rather than on your own computer or office servers.

In my business, I've already moved our payroll and e-mail newsletter services to the Web. Both functions became vastly less time-consuming and easier. It used to take a few days to send a newsletter, and I needed staff who knew complicated tech programs. Now, my administrative assistant handles it all in a few hours, and the Web-based service (we use MyEmma.com) takes care of all the backend issues, including cleaning up the mailing list. Piece of cake.

Compare this to one of the computer-based, downloadable programs we bought, instead of choosing a cloud-based option. Just a year ago, we bought ACT, the leading sales management program, instead of subscribing to a Web-based program, such as Salesforce.com. We thought it would be cheaper. Buy it once, use it forever — right? Wrong. ACT was clumsy to install and manage from the start, and we needed tech help. Worse, after now upgrading our server, ACT wants me to shell out hundreds of dollars to upgrade — or it won't work. Yikes. With a Web-based solution, our costs would have been predictable, tech problems handled by them, and we could use the program with any computer.

So, from now on, I look to the cloud first. And so should you. Of course, there are also some disadvantages.

Advantages of web-based services:

• Always have the latest upgrade, without paying extra.

• Predictable costs, usually a low monthly subscription.

• More features than you could devise yourself.

• No internal tech staff required.

• Can access from any computer with a fast Internet connection.

• Information secure and backed up.

• Can use with any computer.

• Reduces your need for an office computer network.

• Typically, easy-to-learn and use.

Disadvantages:

• Need a fast, reliable Internet connection.

• Ongoing monthly cost, even when you don't use it.

• Privacy concerns, especially if you're not careful.

• If the company goes out of business, you may lose your data.

So, when should you avoid cloud computing? If you work in locations where your Internet connection is on dial-up or unreliable, don't choose Web-based services. If you do a lot of work on airplanes, make sure you can download your documents and info before you travel. If you have highly sensitive information, you need to be vigilant about your own security precautions. Although virtually all Web-based services probably have better security than you do on your own computers, you may be slightly more vulnerable in a Web-based environment, especially if you're lackadaisical about changing passwords when employees leave or using non-secure Internet connections in public places.

Finally, if you're paranoid, you won't want your info in the clouds. Let's face it, some people just think the government or someone else (vengeful ex-spouse?) might go after the information they store on the Web.

Personally, I now look for Web-based solutions whenever we need to implement a new business process. Keeping my business in the clouds is heavenly.

Rhonda Abrams is president of The Planning Shop, publisher of books for entrepreneurs. Her newest book is Successful Marketing: Secrets & Strategies. Register for Rhonda's free business tips at www.PlanningShop.com. For an index of her columns, click here. Copyright Rhonda Abrams 2009.