A cloud for our time

The hottest trend in business computing is beginning to make its mark with Middle Tennessee companies [From our print edition featured in Monday's City Paper]

More and more Nashville businesses are having their heads in the clouds.

And they’re benefiting from the view.

Cloud computing — Internet-based computing through which shared resources, software and information are provided on demand to computers and other technology devices — has gained significant traction locally during the past 18 months, according to cloud expert Joey Dunagan, owner of management consulting firm Prestar.

For cloud users, gone are the days of investing significantly in costly infrastructure such as servers and enterprise software or managing a complex Web of systems that need to communicate with each other. And it often comes with decent cost savings.

“A customer pays only for the services it uses, which is a game changer for small and mid-sized businesses,” Dunagan said.

Dunagan said cloud computing translates into value through its flexibility, ease of use, lower cost of ownership and interoperability.

“Road warriors and those who work from home simply need an Internet connection and a Web browser,” Dunagan said, adding that San Francisco-based Salesforce.com has developed a platform in the cloud that many companies worldwide (including some in Nashville) now use.

“With cloud computing, you can distribute improvements much quicker and you essentially have a fresh product all the time,” said Paul Joiner, vice president of corporate development for Franklin-based Passport Health Communications Inc. “The downside is you have to manage that.”

Management challenges notwithstanding, Joiner said that within healthcare IT, the “big buzz” for the past two to three years has been software as a service, or SaaS.

“Health care is very fragmented,” he explained. “The most efficient way to distribute the tools and data across those fragments is via the cloud.”

Web-based corporate resources company Proformative recently announced the results of an extensive survey of financial professionals regarding cloud computing and SaaS. Though business owners are moving forward with caution, the survey showed cloud computing and SaaS have “delivered to many firms higher ROI, increased collaboration, and greater confidence in systems and their business value.”

Dunagan is not surprised.

“In this economy, businesses need to stretch their investments in technology more than ever,” he said. “And the SaaS model is typically priced-based on consumption by the user, which is attractive.”

Joiner said the use of the cloud allowed Passport, which uses Salesforce.com, to more effectively deploy a new customer relationship management tool.

“All we had to do was issue user names and passwords,” he said. “Before, it would have been much harder. You can quickly make changes in the cloud because everybody has access to the cloud. A lot of remote employees can instantaneously move information and learn something about our clients.”

James Jamieson, managing partner with Brentwood-based Optimize Partners LLC, shares Joiner’s enthusiasm regarding cloud computing. The model can cut costs and is more easily scalable, he said, especially for larger organizations that have a range of IT needs.

Jamieson said that while no single technology can meet all of Optimize Partners’ client needs, his company has been able to build “compelling IT outsourcing solutions for a wide range of customers and applications across diverse industries” with its cloud computing partners.

The cloud model does face some hurdles, though, and the biggest among them is the perceived lack of security with not owning equipment or knowing just where that equipment sits. Dunagan said concerns regarding security within the cloud might have possibly restricted overall adoption.

“Clients that I serve address this matter with cloud suppliers before purchase by evaluating security protocols,” he said. “Also, keep in mind that these larger players in the cloud do have the resources to devote to security unlike many companies that purchase the software.”

While acknowledging that adoption of new technology is always a challenge, Dunagan said the fact that cloud applications are delivered through a Web browser should ease concerns.

“Users are typically comfortable with Web browsing, which simplifies the overall user experience,” he said. “Also, I find that users love the convenience and flexibility of it. Any PC with a browser can work with cloud applications.”