What does Cloud Computing contribute to digital transformation processes?

Before your company is left behind, it may be worth knowing how Cloud Computing technology can be applied to digital transformation processes. And it is that only in the first year of the pandemic, the market value of these cloud services has grown from 1T3T270 billion in 2020 to 1T3T332.3 billion in 2021. From remote work and online classes to financial transactions, this technology underpins all digital business models. 

It is no exaggeration to say that cloud services will enable businesses to grow like never before. In accordance with Google, one of the companies with the greatest reach in this branch, digital transformation allows redesigning and redefining relationships with customers, employees and partners in new technologies to stay competitive with new solutions. For example, physical points of sale (office, paper files, cash payments, etc.) can be transformed into digital processes that depend on the exchange of data (electronic platforms) such as online stores, cloud processes, virtual currencies, etc. etc. 

Cloud Computing in Digital Transformation Processes

Cloud Computing provides digital transformation processes with the necessary infrastructure to maintain businesses and industries in the global market. In fact, in a 2018 report, the firm Allied Market Research indicated that cloud services can lower annual costs for businesses by 35%, keeping them economically sustainable.

In Latin America, the countries that stand out in profits for having carried out their Digital Transformation thanks to Cloud Computing are Brazil, Mexico, Argentina, Colombia and Chile with an income of $1.8 billion dollars and estimates that by 2022 the income generated by this industry will exceed $7.4 billion in the region, expanding at an annual rate of 31.9%.  

But, is it really worth the investment and the digital transformation towards Cloud Computing? What risks can this process bring? Next, we will see what this new technology is and what impact it has on the implementation of the digital transformation of companies. 

What is Cloud computing for Companies?

As we mentioned before, allows physical infrastructure to be replaced by an architecture in the cloud, which saves space, lowers energy, maintenance and training costs, which allows more effective communication between companies, employees and customers, among many other benefits. These digital transformation services are available on-demand through Google, Microsoft Azure and Amazon Web Services

There are three types of cloud computing service models for the main Digital Transformation processes: infrastructure as a service (Iaas), offers computing and storage services; platform as a service (PaaS), provides a development and deployment environment for building applications in the cloud, and software as a service (SaaS), provides applications as services.

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Depending on your type of company, Cloud Computing offers different responses to Digital Transformation Processes. For example, data security is the main reason by which organizations hesitate to start their migration to the cloud or increase their level of adoption (mainly those in the financial sector). 

How secure is Cloud Computing?

According to the heads of these companies, their information would be more vulnerable in this type of digital service, so they prefer to continue with physical servers to protect themselves. This prejudice remains in force although the main actors have shown that security breaches in public clouds are a rarity, because the data of its clients is encrypted and isolated from each other, so they are not compromised in the event of a cybersecurity incident.

In fact, your information may be more secure when you complete your Digital Transformation process through Cloud Computing. People who violate your security they can use malware and phishing emails to get the information stored on your own devices. They could freeze your computer, demanding a ransom before releasing the files and data they have frozen.

It is probable that the security measures adopted by the companies that provide services of Cloud Computing for Digital Transformation for companies to be better. First, servers are often located in warehouses that most workers don't have access to. Second, files stored on cloud servers are encrypted. This means that they are encrypted, making it very difficult for cybercriminals to access.

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In addition, they have constant security updates to be aware of new threats. The latter is incorporated into firewalls, Artificial Intelligence tools and automatic patches based on built-in algorithms to search for and identify possible vulnerabilities in security measures.

But what about hardware failures, power outages, or natural disasters? Unlike a physical company, digital transformation through Cloud Computing allows the use of Redundancy technology to create multiple security backups of stored information. Thus, if a server goes down, you can access your files from a backup server.

What role does Cloud Computing have in the Digital Transformation of Companies?

Digital Transformation through Cloud Computing allows companies to adapt quickly and efficiently to the "new reality" post-pandemic, thanks to the technological services they offer. According to an IDC study; companies that embrace digital transformation are more profitable than those that do not. only in Latin America expects a growth of 30.4% in investment in cloud services.

All this growth is thanks to the possibilities that they obtain when acquiring these services, because in addition to the aforementioned security and storage, there may be practical solutions to problems that they face every day: 

1. PAYG (Pay-as-you-Go)

This Cloud Computing tool allows you to transition to a Digital Transformation with the ability to innovate and create new applications and systems, which can be integrated with the current ecosystem in days and weeks, paying according to consumption. This ownership of Cloud Computing offsets growing spending on IT workforce and other initiatives. IT and software teams can dramatically reduce the time to market for new products and therefore speed time to market.

On average, moving to the cloud saves around 15% on all IT expenses. SMBs get the most benefits from the cloud by spending 36% less money on IT (Source: OpsRamp, Skyhigh Networks, Directive)

2. High scalability

Scalability allows handling increasing workloads according to each application thanks to the fact that these processes are carried out through virtual machines that can be activated according to the commercial needs of each company. Virtual machines are very flexible, they can handle ever-increasing applications and orders as needed.

This Cloud Computing scaling work allows the Digital Transformation of processes, both vertically and horizontally. This means we can handle processing or storage capacity as the platform needs to grow, as well as add more servers to current systems, splitting workloads across virtual machines, ensuring businesses have the most uptime. available activity and better performance.

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3. Elasticity 

The elasticity of the cloud allows you to handle different CPU, memory, and storage requirements based on fluctuating usage requirements. Digital transformation plans through Cloud Computing are governed by the budgets of each company and must keep track of unwanted costs to avoid a loss of profits. 

Without the elasticity of the cloud, organizations could end up paying more than expected or needed resources. While there are manual processes for scaling up and down cloud resources, organizations should invest in AI-ML-powered cloud monitoring tools to determine if excess compute or storage resources can be decommissioned.

4. Mobility and automation

Digital Transformation through Cloud Computing offers enormous opportunities for automation, as it facilitates the establishment of infrastructure-as-code practices, automated backups, version control provisioning for workflows, administration of security controls through access of users and the platform model as a service (Paas).

Organizations are trying to build digital business models and the cloud is at the core of them. These services are data-driven, highly adaptable, asset-light, and anywhere. The cloud is critical to enabling the digital model by providing access to the “Everything as a Service” model that creates multiple automation processes for a functional system for each company. As these models become more prevalent, humans will work alongside automation to enhance their cognitive capabilities and abilities.

This automation thanks to the Digital Transformation through Cloud Computing allows work teams to collaborate from anywhere at any time because the data is available in the cloud.  

On the other hand, many companies have focused on exporting or internationalizing their operations given the effects of the COVID-19 pandemic. Cloud computing is the tool that allows resources to be distributed efficiently according to each scenario and that, if they need to be modified, it can be done easily and quickly.

Examples of the Use of Cloud Computing in the Digital Transformation of Companies

Digital Transformation processes thanks to Cloud Computing are not reserved only for large companies, because there are solutions for medium and small companies that can be of great help. In fact, as we mentioned earlier, These are the ones that can benefit the most with a saving of 36% on their expenses.

The financial department is one of the main candidates to start its Digital Transformation through Cloud Computing, since it allows to facilitate the complex manual processes to automated systems in the cloud reduce the number of possible natural errors. In addition, they allow you to streamline the automation of your accounting circuits, your Accounts Payable process becomes powerful, intelligent and easy to manage.  

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We cannot forget the accessibility that this type of cloud service provides, it is intuitive software that allows any team to quickly start using this type of tool. Even automating the payment of bills through Cloud Computing will allow you to quickly, easily and accessible eliminate possible errors present in the financial function and that hinder your performance levels and your exercise.

The Digital Transformation through Cloud Computing would help you make pay-per-use invoices convenient and adapted to your company, have full availability of the tool and achieve the centralization of financial information for greater visibility, traceability of documents and a better relationship. with suppliers, customers and employees.

If you are interested learn more about this, discover the Cloud Computing solutions for your Digital Transformation processes, from machine learning, microservices, migration from traditional monolithic systems to serverless architecture in record time that we have at Codster for your company. We are an official partner of Amazon Web Services, and we want to help you implement your digital transformation strategy hand in hand with a group of experts.

Eri Gutierrez
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