What is Your Cloud Computing Strategy?

By on Jul 9, 2015

Cloud computing and storage have sneaked into insurance agencies in the form of Google Apps and Office 365, along with quite a few file-sharing and storage sites like Dropbox, Box.com, Google Drive, and OneDrive.

These “Shadow IT” solutions are being used by agency staff on a small ad hoc basis to answer specific business needs – like delivering large files to another party. Regardless of size, all firms are using the cloud whether that use is sanctioned by management or not.

Does your agency require a Cloud Strategy? In short, the answer is – Yes.

The 2015 State of the Cloud Report from RightScale shows that around 88% of businesses are utilizing public cloud, 63% are using a private cloud, and 82% of the companies have a hybrid cloud strategy, up from 74% in just the last year.

Following are the benefits of using cloud solutions:

  • Speed: Business needs often require quick solutions, without waiting for major company initiatives to be approved.
  • Finances: Changing old infrastructure can be costly. Cloud computing can be a less expensive alternative to building your data center.
  • Competence: Most agency IT staff do an excellent job of keeping things running. However, they often don’t have the deep technical expertise that is sometimes required. Outsourcing the very technical needs to a cloud provider can be a good business decision.
  • Scalability: Cloud solutions allow the agency to grow more easily just by adding another user. No longer do you have to make big investments in hardware when you need to expand.

For many insurance agencies, their experience with cloud computing is their hosted agency management system. There are now solutions available that will allow the agency to host their individual desktop computers in the cloud – eliminating the requirement for in-house computer servers. This process is called Desktop as a Service (DaaS). Last year, I wrote an article on LinkedIn, Back to the Future: The Revival of the Virtual Desktop, that details this new type of service.

My point? Your use of cloud computing solutions is going to increase. There are benefits and there are possible risks. Agency management should have a plan in place to get the most out of cloud technology and mitigate the associated risks.

Proper Cloud Technology Planning

A good plan will not hinder your existing IT department’s responsiveness or self-sufficiency. It will improve the ability of the organization to respond faster to business needs. Whether your cloud solution is public, private or hybrid, you should aim for the following:

  • Create a Standardized Operating Environment (SOE), which focuses on security and makes the upgrade process more stress-free.
  • Use one SOE Management Platform throughout your entire organization so that handling, supervising, and maintaining your technology infrastructure is easier.
  • Make sure the solution you use provides better efficiency, improved data management, higher security, and system authentication.

Overall, your solution should reduce your Total Cost of Ownership (TCO).

This may seem like an academic exercise. However, your use of cloud computing solutions will increase. Take a few minutes to think about how your organization should respond to this growing trend.

How are you planning on implementing cloud computing within your agency? Let me know in the comments below.

4 Comments

  1. Thanks for the cloud overview today. Poignant for my current activities at CBIZ since we’re running a tco analysis. Our biggest hurdle is dated applications. Work Smart /image right still run as Client server apps and thus require citrix to manage state across multiple applications. Until Vertafore updates the application architecture we’re stuck with a cloud strategy that requires us to move desktops to the cloud. Not sure we’re there yet.

  2. Steve,
    Hope you are well. This is timely for us. In conjunction with transitioning from TAM to Nexsure next month (exciting but nerve-racking as well) we are shifting our email platform from Applied/Microsoft to Microsoft 360. Our IT firm proposed this as the opportune time to replace our aging (5-6 year-old) servers. I pushed back at the cost and timing and that led to a discussion of using Microsoft 360 cloud features (Sites, OneDrive, Azure) to send our corporate shared docs and MyDocs folders to the cloud which it turns out means we won’t need local servers anymore. Presumably that will lead to a reduction in monthly IT maintenance service costs as well in addition to avoiding $20,000 or so of up-front hardware and installation expense (2 offices in different states). And we were licensing 360 anyway so really no additional cost beyond data migration and configuration.

    Does this sound right to you? One question we have is should we use the servers for non-cloud extra backup storage or junk them? I’d like to put you in touch with my IT manager (really one of our younger brokers moonlighting this role on the side and yes, we are at the point where we think we need to change that but are leery of needing a full-time employee for IT management, esp. as more and more gets outsourced).

    What options do we have to obtain the benefit of your advice on a retainer-like basis (within budget of course)?

    Thanks as always for your willingness to provide input to your former students!

    • Peter. Thanks for your comments. There certainly are a lot of moving parts to make sure you can implement a cloud strategy well. I’d be glad to talk with your IT person.

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