Cloud computing

Definition

Cloud computing refers to the delivery of computing services—such as servers, storage, databases, networking, software, analytics, and intelligence—over the internet ('the cloud'). This technology enables organizations to access and manage their data and applications remotely, fostering digital transformation and efficiency in operations.

5 Must Know Facts For Your Next Test

1. Cloud computing offers scalability, allowing organizations to easily adjust their resources based on demand without major capital investment.
2. It enhances collaboration by enabling teams to access files and applications from any device with internet connectivity.
3. Security is a major concern in cloud computing; however, many providers implement robust security measures to protect data.
4. Cloud computing can significantly reduce costs for businesses by minimizing the need for physical hardware and IT maintenance.
5. Many organizations leverage cloud computing to support digital transformation initiatives, improving agility and innovation.

Review Questions

• How does cloud computing enhance organizational efficiency in the context of digital transformation?
  • Cloud computing enhances organizational efficiency by providing on-demand access to resources and services that support various business functions. It allows companies to quickly scale up or down based on their needs, thereby optimizing resource utilization. Additionally, by facilitating remote access to applications and data, teams can collaborate more effectively, leading to faster decision-making and improved productivity—all crucial components of digital transformation.
• Discuss the security challenges associated with cloud computing and how organizations can address them.
  • Security challenges in cloud computing include data breaches, loss of control over sensitive information, and compliance issues. Organizations can address these concerns by implementing strong encryption practices for data at rest and in transit, conducting regular security audits, and ensuring that they choose reputable cloud service providers with robust security protocols. Training staff on best security practices and establishing clear data governance policies are also essential steps in mitigating risks.
• Evaluate the impact of cloud computing on traditional business models and the implications for future business strategies.
  • Cloud computing significantly disrupts traditional business models by enabling businesses to operate more flexibly and efficiently. Companies can shift from capital-heavy investments in IT infrastructure to subscription-based models that reduce financial risk. This shift encourages innovation as businesses can experiment with new services without large upfront costs. As a result, future business strategies will likely focus on agility, scalability, and customer-centric approaches enabled by cloud technologies.

Related terms

Infrastructure as a Service (IaaS): A cloud computing model that provides virtualized computing resources over the internet, allowing businesses to rent IT infrastructure instead of investing in physical hardware.

Software as a Service (SaaS): A cloud delivery model where software applications are hosted on the cloud and made available to users via the internet, eliminating the need for local installation and maintenance.

Platform as a Service (PaaS): A cloud computing service that provides a platform allowing customers to develop, run, and manage applications without dealing with the complexity of building and maintaining the underlying infrastructure.