The History of Cloud Computing Systems

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The History of Cloud Computing Systems: The Concerns, Benefits and Implementation
MIS 535: Managerial Applications of Information Technology
Professor Francois
Megan Purdy
Keller Graduate School of Management
mpurdy77@gmail.com
December 3, 2014

The History of Cloud Computing Systems

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Table of Contents
I.
II.
III.
IV.
V.
VI.
VII.

Introduction3
What is Cloud Computing3-5
Concerns...........5-7
Benefits...7-10
i.
SWOT Analysis of Cloud Computing..10-11
Implementation..11-13
Summary13-14
References..15-17

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Introduction

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In this course project, the technology that I chose to focus on is Cloud Computing and
many of its varying elements. I would like to begin looking at its history and what cloud
computing actually means to information systems. During my research of this phenomenon of
the business and technology environment, I would like to also take a look at the impact that it has
had on organizations and the longstanding effect on the information systems world as well. I
would also like to take a look at some of the potential issues that may arise for an organization
during their transition into using cloud computing while still keeping in mind and discovering the
many benefits that can be attributed to it as well. Since the option of cloud computing offers
such great flexibility for companies in its delivery of their information technology systems, it
will be interesting to see why or why not some companies choose not to take advantage of this
system. I also plan to discuss options and methods for the best way to implement cloud
computing into an organization and its existing infrastructure.
What is Cloud Computing?
When approaching the topic of cloud computing and how it has impacted our world of
technology and information systems, it is important to fully understand what cloud computing
really is. Cloud computing is the new buzz term or popular concept in the world of information
technology. In basic terms it is the concept of an organization being able to alleviate some of
their responsibility by storing their data on an infrastructure belonging to a third party.

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Cloud computing is a way for organizations to share their software, resources and
information over internet based computing while being hosted and shared on virtual servers.

(Griffith, 2013) It refers to hardware and software systems that are used in data centers as well as
the applications that are delivered over the internet for the organizations using it. The services
used in cloud computing are often referred to as Software as a Service or SaaS. (Armbrust,
2010) The data centers hardware and software is what is referred to as a cloud. (Armbrust,
2010) It allows organizations to hand over the responsibility of managing their hardware and
software systems to another party and only have to pay for the features that are used.
Cloud computing is a way to encompass any type of subscription based or pay per use
service that can help to extend the capabilities of an organizations IT department. (Knorr, 2008)
It is a way to store and access an organizations data, programs and applications on the internet
instead of in house on a hard drive or the local storage. With cloud computing, all of that data
gets accessed over the internet and it can be done anywhere and at any time as long as there is an
online connection. It can be accessed from the web browser of a laptop, hand held device like a
tablet or mobile devices.
Moving through personal computing has evolved over a few different phases. The first of
these included where data and applications were stored solely on the desktop, the second phase
had those applications and data being stored on a local server and the software was still on the
local desktop in addition to the internet. In the third phase though, most data and software is

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stored on the internet and is what is known as cloud computing. (Nelson, 2009) Before cloud
computing came into existence, traditional systems and applications were quite complicated and
expensive as well for organizations. (Salesforce.com, 2010-2014) There was an extensive
amount of hardware and software that was necessary to be able to properly run them. The
traditional systems also required a large team of IT professionals to be able to install the
programs, test them out properly, run them, make sure they were secure and constantly update
them.
Concerns
Cloud computing came onto the Information Technology scene with a lot of buzz and
excitement, even though many different executives were hesitant to fully embrace this new
concept. Some of the concerns that were raised and even may still be today relevant today
revolve around the security of the system and whether or not it could truly withstand the high
volumes of traffic that it will be sure to endure and what would the potential plan be if the system
would happen to crash. These arent unreasonable concerns that have been raised by skeptical
companies about the cloud computing system, but they should also keep in mind the positive
things that may come about from the system as well. Some of the other concerns that arise in
regards to cloud computing have to do with who is really paying for the cloud and if it truly is
cheaper overall after all that time. Another concern still is over who has ownership of the
information that is floating around in the cloud and is storing all the organizations information
and data in the cloud really that much safer than keeping it onsite. (Bonfante, 2014)

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There are some areas that should be kept in mind when considering the option of
implementing cloud computing into an organization. A major concern revolves around the topic
of data and its security. By using the cloud, the organizations data is all being located or
centralized in one location and is now out of the direct control of the organization That data that
is considered to be private and sensitive in content will now be controlled by a third party which
in turn causes concerns with compliance and confidentiality management. By using a cloud it
opens up the door to the possibility of too much information being shared, either knowingly or
unknowingly. Customers need to be aware enough to realize this and make sure that they are
attaining as much information as possible about the third party provider that will be managing
the organizations data.
Another area to be aware of is if the providers do not subject themselves to regulatory
compliance. Organizations should be fully aware of where exactly their data is being stored.
Sometimes the data could be housed in a different country all together which cod potentially
violate privacy requirements of customers. With knowing where the data is stored also brings
the fact that an organization may or may not be aware of what will happen to that data if there
was some sort of disaster. Organizations should require their provider to have the ability to
restore the date completely and in a timely manner.
Being that clouds house data from multiple organizations and individuals, there is a
concern about that data being properly segregated. Organizations should be sure to require proof
or evidence from their providers that their data is well encrypted and protected from being
exposed from other organizations. As unpleasant as it may be to think about, there is the
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potential for illegal activity to occur within the cloud computing world. It can be quite difficult
to investigate these activities or security breaches since there are such a large number of
organizations housing their data simultaneously in the cloud. Without some sort of contract or
proof that the third party has taken precautionary measures to protect an organizations data from
illegal activities, there is a risk of it happening. Finally, there is concern about the longevity of
the provider and their ability to provide quality service. Organizations should prepare and find
out how they would retain their data if they were forced to change providers.
Benefits
When making the decision of whether or not a cloud computing system is right for a
business, it is completely understandable to want to weigh the benefits of the system with the
negative aspects that were mentioned earlier. However, the benefits of this system seem to
outweigh the negative.
The benefits of cloud computing that help organizations determine if transitioning to
cloud computing from traditional systems most often begins with cost. The cost for an
organization to get started with cloud computing is often much less in comparison to a traditional
system. There is no longer the need to have to pay for hardware and software products,
maintenance, licensing fees and upgrades to new products. (Salesforce.com, 2010-2014) The IT
portion is no longer directly on the shoulders of the organization and their IT group. The
company is able to use the system software without worrying about server maintenance,
installation or updates since the provider will be responsible for all of it. The cloud computing
system is overall more business friendly which in turn also makes it financially beneficial.
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(The Guardian, 2013) The organization will be responsible for paying a monthly fee for using
the software within the company for each employee that has access to it.
There is also the fact that there is no longer the need to have to maintain a large IT
workforce since the work will be handled by a third party vendor. It takes companies few people
to do the work in a cloud computing system. It reduces the time necessary to train employees on
the use of the network systems and having to staff a large IT group plus trainers. This means that
the staffing numbers can be adjusted to better meet the actual needs of the company better. It
also helps to better manage the finances that spent on staffing and equipping the IT department
and the technology that is used throughout the company. It allows the company to be able to
better change with the evolving needs of the business. It can also allow staff, such as IT staff
members, to work on other projects or areas that may be of importance to the business and
moving it forward. There is also less of a learning curve for the use of new hardware and
software. The organization can then turn their focus over to strengthening other areas of their
business. An organization can now choose more selectively what applications they actually need
and what is best for the needs of the company rather than having to pay for a whole suite of
applications. Organizations have the option to pay as they go and add or drop services along the
way based on their needs. (10 Benefits of Cloud Computing, 1996-2014)
Another advantage of cloud computing is the flexibility that it offers. If a company needs
additional services, these needs can quickly be met by the providers. An organization is able to
adjust and adapt to changes without putting their budget and staffing limitations in jeopardy.
Since the infrastructure that is being used is located in multiple data centers in various locations,
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it allows the users the flexibility to access the necessary information from anywhere and at any
time if they have internet access. (Salesforce.com, 2010-2014) This allows workers to not have
to carry hard copies or large amounts of files or equipment with them. They can instead use
laptops, tablets and other mobile devices to work on the go. It also encourages a more
productive work and life balance. . Employees will have the ability to work from anywhere and
not tied down to their workspace, which could lead to more productivity by being able to answer
emails, retrieve documents and update inventory when out of the office. This can have a
positive impact on the environment as well by using less energy and products and save the
company budget as well as lessen their carbon footprint. (Salesforce.com, 2010-2014)
Cloud computing also has a positive impact on promoting collaboration. It gives the
opportunity for multiple people to access and utilize the same documents or files at the same
time. Since collaboration is a big part of business, this is most definitely a benefit. Cloud
computing allows all files to be kept in the same location and all employees to be able use the
same file or copy simultaneously. This in time can also positively affect the efficiency and
productivity of a company increasing the return on investment. It can help businesses to better
meet their budgets and monitor projects. (10 Benefits of Cloud Computing, 1996-2014)
Cloud computing can offer organizations more confidence in regards to their business
continuity, stability and disaster recovery. When they begin using cloud computing, there is no
longer the great need to equip the organization with large and complex disaster recovery
programs and plans. The providers take on that responsibility an can take care of most issues
and can do it in a more efficient manner than the organization could do themselves, typically
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even four times faster than businesses that dont use cloud computing. (Salesforce.com, 20102014)
By taking a look at the struggle organizations face with traditional application systems
and eliminating them, cloud computing can help them to focus more on the applications that will
help deliver the value strived for by the business. Using cloud computing can help to alleviate
the stress that organizations deal with when working with a multitude of servers and software
systems.
SWOT Analysis of Cloud Computing
Strengths

Shared computer resources

Savings in organizational costs
No licensing, maintenance or upgrade fees
A reduced need to rely on external consultant firms
Mobility and flexibility

Weaknesses

Lack of control
Unpredictable attitudes of users
Global economy issues
Security of data and privacy

The History of Cloud Computing Systems

Opportunities

Flexibility and room for growth

Ability to consolidate within the legal and regulatory environment
More room for development and further innovations

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Threats

In house IT personnel
Data protection
Security

Implementation
When introducing a cloud computing system into an organization, there should be a clear
plan as to how it will be implemented into the organization with some basic steps kept in mind.
Some the steps include defining the new strategies so that all potential questions can easily be
answered and how make the new system work and integrate with the current system. Make sure
that you are able to clearly define the new software that will be used as well as the different
models that will be used as well. There should be attention paid to clearly defining the policies
that will help to balance out the organization and their goals as well as creating a strategy as to
how the plan and new system will be seamlessly introduced and implemented across the
organization. (IT Business Edge, 2014)
Finding a perfect mix of applications can be a challenge for organizations and moving to
a cloud system from a traditional system can be particularly challenging. Implementing a cloud
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strategy focuses a great deal on customizing the system to best fit the organizations needs.
When beginning the process, it would be wise to conduct an assessment of the business needs of
the company and then look at how to incorporate the existing IT structuring to help meet those
needs. (IT Business Edge, 2014)

Developing a starting point and knowing what direction the organization want to go in
and help to better develop a strategy. It is equally as important to be able to have that strategy
incorporate the existing IT infrastructure and use it to help further plan for the future. When
making the change from traditional programs to cloud computing, security is of great
importance. Before making the transition, care and planning should be addressed foremost to
ensure the privacy of the companys data. (IT Business Edge, 2014)
When moving into the cloud environment, there should still a form of management in
place. This will include the addition of different toolsets that are specific to areas of the system
and used to best monitor the resources being used by the IT department. These toolsets may
have to change to be able to adapt with the changes happening within the system. (IT Business
Edge, 2014) By using outside providers, organizations can have advice from those that are more
experienced in making those decisions. Reaching out to one of these experienced solution
providers can be quite beneficial overall to the organization in these transitions.
Deciding which applications to use is an important part of the strategy. Some
applications have to be re-adjusted before they can be used in the cloud system and others are
specific for use in the cloud. By reaching out to experience providers, it will help to make those
decisions somewhat easier. Finally, as with any change or transition, there will be bumps in the
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road. Even during the planning stages, organizations need to be prepared for changes to occur
during the design process. They should also be planning for the future as well and the direction
that the organization hopes to take. (IT Business Edge, 2014)
Summary

Some businesses will continue using traditional systems until they can be assured of their
security and privacy concerns in the cloud computing system. It is a pretty solid prediction that
cloud computing will continue to grow in its popularity and use across a variety of organizations,
both large and small. As of now, it is predicted that by 2016, over a quarter of all applications
that exist will be available for use on the cloud. (Menegez, 2014) A large number of
organizations already spend at least 10% of their budgets on cloud services alone. (Menegez,
2014).

Using cloud systems, even partially, allows organizations to use hybrid systems by

keeping some of their applications in house or on-site and the rest in the cloud. It is a
combination of the strengths of both for the good of the organization. (Menegez, 2014) With
more and more development going into the concept of cloud computing, it can be expected that
the benefits will continue to increase and it will increase the number of third party providers, and
contributors as well that offer cloud services. With the increase of development, there will be
more competition which in turn will lead to more variety of products to choose from. (Menegez,
2014) The concerns that many may have about security and protection of corporate control will
be overcome as further innovations and developments increase. By incorporating clearly defined
security measures and technology, it will enable organizations to maintain control of their data
and information while still moving forward in their business needs.
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Some thoughts that were found in the 2013 survey, The Future of Cloud Computing, by
North Bridge gave some insight into what was to come. It is expected that over the next five
years, the hybrid method will be made up of 42% of the users, with public systems being at 32%
and private at 25%. (North Bridge Venture Partners, 2013) The factors driving the continued use
will be agility at 54.3%; cost will be at 48.17% and scalability at 54.5%. (North Bridge Venture

Partners, 2013) Organizations will still have concerns about security and because of that cloud
providers will need to be diligent in providing more clarity and transparency and better assurance
about security controls to organizations.
After finding all the concerns regarding cloud computing and then the many benefits that
exist as well, it definitely seems that the benefits outweigh the concerns. However, it truly is up
to each organization as to what the best solution is for their individual needs. The cloud has a
large following among organizations already and it is only expected to increase over the coming
years.

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References
Armbrust, M., Fox, A., Griffith, R., Joseph, A., Katz, R., Konwinski, A., Lee, G.,
Patterson, D., Rabkin, A., Stoica, I., Zaharia, M. (April 2010) A View of Cloud
Computing [Article]. Retrieved from
http://delivery.acm.org/10.1145/1730000/1721672/p50-armbrust.pdf?
ip=173.20.210.231&id=1721672&acc=OPEN&key=4D4702B0C3E38B35%2E4D4702B

0C3E38B35%2E4D4702B0C3E38B35%2E6D218144511F3437&CFID=604755712&C
FTOKEN=20647586&__acm__=1417581689_c65626b3470d4cd0a618e8efcf510dad
Bonfante, L. (February 10, 2014) Three Flawed Issues About Cloud Computing [Article].
Retrieved from http://www.cioinsight.com/it-management/expert-voices/three-flawedissues-about-cloud-computing.html
Griffith, Eric (March 2013). What is Cloud Computing? [Article]. Retrieved from
http://www.pcmag.com/article2/0%2c2817%2c2372164%2c00.asp
IT Business Edge (2014). Six Steps That Simplify Moving to the Cloud [Article].
Retrieved from http://www.itbusinessedge.com/slideshows/six-steps-that-simplifymoving-to-the-cloud-02.html

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Knorr, Eric (April 2008) What Cloud Computing Really Means [Article]. Retrieved from
http://www.infoworld.com/article/2683784/cloud-computing/what-cloud-computingreally-means.html
Menegaz, Gery (May 2014) The Future of Cloud Computing: 5 Predictions [Article].
Retrieved from http://thoughtsoncloud.com/2014/05/future-cloud-computing-5predictions/
Morrissey, Mike. (January 2014) The Future of Cloud Computing [Article]. Retrieved
from http://perspecsys.com/future-cloud-computing/
Nelson, M. (2009). The Cloud, the Crowd, and Public Policy. Issues in Science &
Technology, 25(4), 71-76. Retrieved from Computers & Applied Sciences Complete
database, http://issues.org/25-4/nelson-2/

North Bridge Venture Partners (2013). The Future of Cloud Computing [Slide Share].
Retrieved from http://www.dworin.com/north-bridge-venture-partners-and-the-future-ofcloud-computing/
Salesforce.com, Inc. (2000-2014). What is Cloud Computing, [Article]. Retrieved from
http://www.salesforce.com/cloudcomputing/

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Salesforce.com, Inc. (2000-2014). Why Move to the Cloud? 10 Benefits of Cloud

Computing, [Article]. Retrieved from http://www.salesforce.com/uk/socialsuccess/cloudcomputing/why-move-to-cloud-10-benefits-cloud-computing.jsp
The Guardian, (September 23, 2013) Why cloud computing is perfect for small
businesses [Article]. Retrieved from http://www.theguardian.com/media-network/partnerzone-microsoft/cloud-computing-perfect-small-businesses
Verio Inc. (1996-2014) 10 Benefits of Cloud Computing [Article]. Retrieved from
http://www.verio.com/resource-center/articles/cloud-computing-benefits/