Overview of Cloud Computing

Cloud computing - we hear the term almost daily. But really, just what is cloud computing all about? That seems to be a common question. In June of this year, TELUS and IDC Canada released a study on cloud computing which surveyed 200 Canadian business and IT executives and directors at large Canadian companies (500+ employees) across a range of industry sectors. The study found that 63% of Canadian companies surveyed did not have enough or had only a base level of knowledge to make decisions on whether to use a cloud service or their internal IT department.
A recent article from eweek.com also indicates that there is a great deal of confusion about cloud computing. The article makes reference to a recent study commissioned by Citrix Systems which included more than 1000 adults in the U.S. The study showed that most respondents thought that the cloud is related to weather. 51% of respondents thought that the weather could interfere with cloud computing. Despite the confusion, the study also found that 97% of participants are using cloud services today with examples including on-line banking, shopping, social networks and file sharing. Further, 59% of respondents indicated that they believe that the "workplace of the future" will be in the cloud which is somewhat contradictory to the prevalence of cloud computing today.
This insight above mirrors what we find amongst our own clients. Knowledge of cloud computing is relatively limited and as a result, organizations may be missing out on significant opportunities to make their business stronger by reducing cost and risk. Our hope is that this article provides insight into cloud computing to help you to assess its fit for your business requirements.
What is cloud computing?
First of all, it's useful to understand where the term cloud computing came from. It most likely originated from the use of a cloud image to represent a networked computing environment or the internet.
A quick Google search will reveal a number of definitions for cloud computing. I like a definition I picked up from Wikipedia which defines cloud computing as the delivery of computing as a service whereby shared resources, software and information are provided to computers and other devices as a utility, similar to the electricity grid, over a network which is most often the internet.
What are the various cloud computing models?
To sort out some of the confusion around cloud computing, it is helpful to understand the various cloud service models, of which there are three - software as a service (SaaS), platform as a service (PaaS) and infrastructure as a service (IaaS).
SaaS is the most widely known flavour of cloud service. SaaS is sometimes referred to as on demand software. With SaaS, software and its associated data are centrally hosted and are typically accessed over the internet using a browser. What are some examples of SaaS? MailChimp, the application we use to distribute our newsletters, is an example. Google Apps is another example as is Dropbox, and the list continues to expand.
PaaS provides the delivery of a computing platform and required solutions to facilitate the deployment of applications without having to invest in the cost and complexity of hardware and software. Some examples of PaaS include Microsoft Azure and Google's App Engine.
The IaaS service model allows clients to avoid the procurement of servers, software, data centre space and network equipment. Such resources are provided as a fully outsourced service. Examples of IaaS include Amazon's Elastic Compute Cloud and Rackspace.
In addition to the various cloud service models, it's useful to understand the delivery models through which cloud computing is distributed. The main delivery models include public, private, community and hybrid.
A public cloud offers infrastructure and solutions to the general public and is typically owned by a large organization that sells cloud services.
A private cloud is designed solely for one organization. A private cloud may be managed by the organization which uses it, or by a third party, and the infrastructure may be located on the site of the cloud user or elsewhere.
A community cloud is shared by several organizations and supports a community of users, usually with some common interest, such as regulatory concerns.
A hybrid cloud model consists of two or more clouds, for example a public and private cloud, bound together by technology to facilitate data sharing and portability. Egnyte, a file storing and sharing service, is an example of a hybrid cloud computing solution.
What are some benefits of cloud computing?
Earlier this year I participated in a webinar that featured a round table of CFO's commenting on what they believed to be the major benefits of cloud computing. The benefits cited included the following:

• Cost savings over on-site installations
• Anywhere anytime access through an Internet connection
• Reduced dependency on IT support
• Cloud solutions are most often faster to deploy than on-site solutions
• Cloud solutions typically enables organizations to buy into a bigger product with much more functionality which would be cost prohibitive if similar functionality was acquired through a non-cloud on-site solution
• IT can focus more on value-add activities as opposed to managing IT infrastructure because infrastructure management shifts to the cloud provider
• Cloud solutions typically contribute to the following:
  • More timely financial information
  • Optimizing business processes
  • Connecting with employees and enabling staff to work remotely

What are some of the risks and concerns associated with cloud computing?
Not withstanding the benefits, there are a number of common concerns associated with cloud computing. It is very important to carefully consider risks that could impact your sensitive information, no matter whether you are evaluating cloud or on-site solutions. In doing so, it is also important to evaluate risks associated with cloud solutions in the context of similar risks you could face with your own on-site alternatives.
The most common concern is security. For most small and medium-sized organizations, security with cloud solutions is often better than on-site solutions because reputable cloud solution providers can invest in the skill sets and capabilities to address emerging and evolving threats. Many small and mid-size organizations rely on part-time IT support or have no dedicated IT support at all. This combined with constantly evolving IT risks, would tend to suggest that most small and medium organizations just can't keep up with threats to their information assets. To address security concerns, a reputable cloud provider should be able to provide assurance relevant to the following:

• Access to data - There should be a rigid authentication process that all users should go through to access their data
• Transmission - Data should be encrypted as it travels from your local site to the cloud service provider
• Network - Strong security should be in place to protect the cloud provider's network
• Physical access - The cloud provider should be able to demonstrate solid controls over physical access to its facilities where your data will reside
• Data security -The cloud provider should be able to provide assurance that your data is encrypted when it is "at rest" in the cloud
• Privacy and Compliance - Your cloud provider should be able to provide assurance that it can protect the privacy of your information and comply with relevant standards and legislation that may be relevant to your organization.

Availability of cloud solutions is another concern. It is relevant to assess the impact of a cloud solution becoming unavailable due to circumstances such as an internet outage or a technical failure by the cloud provider. Again such concerns should be analyzed in the appropriate context. Internet outages, especially elongated outages, tend to be uncommon. Reputable cloud providers can most often demonstrate very high levels of uptime performance, and if problems occur, skilled resources are available to address them. How does such a scenario compare with similar risks associated with your on-site alternative? What is your experience with downtime with on-site solutions and can you get timely 24/7 support if you have a critical problem? Availability risks can also be mitigated with the use of a hybrid cloud model. Egnyte was referred to previously as an example of a hybrid cloud model for file sharing and storage. With this option, should the internet go down, you can still have a local copy of your data available.
Access to data is raised as a concern in two contexts. One is how can I get my data back if I leave my cloud supplier. Another is what will happen if my cloud supplier goes out of business. An answer to such questions should be readily available from your cloud supplier and should be specified in your end user agreement. It is most important to consider what format your data will be available in if you seek to get it back from your cloud supplier. Consider for example that if you use a cloud based accounting solution, your data might not be provided back to you in the same format in which you entered it.
One last consideration to think about is data backups. In our experience with smaller organizations, it is not uncommon to find no backup routines or problems with them, such as backups not being stored off site or restoration from back-ups not being tested. Reputable cloud solutions reduce this risk and in fact, many cloud providers have multiple back-up locations in case there is a failure at a particular site.

Choosing The Right Merchant Services Provider

So you are ready to start accepting credit cards as a form of payment for your business or you are just looking to get a rate evaluation to make sure you are being competitively priced from your current provider. No matter the reason that you are looking for a merchant services provider you will be faced with a number of challenges.

Choosing the right merchant service provider can make all the difference in the world to your business. There are literally hundreds of companies advertising everything from super low rates to "the best" customer service. How do you know which one will be best for you? Here are some important points to consider.

1. Pricing and/or Rates

Pricing makes the top of the list of things to consider when working with a new merchant services provider for obvious reasons. It can be extremely difficult to assess whether or not you are competitively priced because pricing can change dramatically for merchants depending on business type, card present vs card not present, E-Commerce vs Retail, Etc. The only way to be sure that you are getting good pricing is to ask multiple providers and then pick the one that is offering the best rates.

2. Service

Another vital issue is customer service and support. If you have a problem running a credit card and a customer is standing right in front of you will you be able to get somebody on the phone in a timely manner to assist? What if you have an issue late at night? Does the provider offer 24/7 support? Is the support outsourced or in house? Customer service in many cases is the number one reason a customer will choose a provider that is even more expensive than their competition. If customer service is very important to you, make sure you get every detail.

3. Funding Options

Some providers will deposit your funds in 24 hours, some take 48 hours, and American Express takes three days. If you need next day funding make sure you find out if the provider offers it before signing a contract. If you need the funds deposited into one account and the fees taken out from another it is also important to make sure you know if the provider is capable of doing that. Some can and some can't. Be sure to find out everything when it comes to when and where you can expect your money.

4. Equipment

Does the service provider offer free equipment? If so, make sure you ask about the first issue, Pricing! A lot of providers will offer free equipment but give you higher pricing to compensate for it. If they do not offer free equipment keep in mind that the average credit card terminal will cost around $200-$250. Another issue concerning equipment is compatibility. Does the provider offer services that will allow you to accept credit cards on your smart phone? Is the equipment PCI (Payment Card Industry) compliant? Is the equipment under warranty? Again, the more information you have the better you will be equipped to make the right decision.

5. Contracts

The industry standard is usually a one year contract. Be sure to find out exactly how long you will be locked in to a contract and what would be the costs associated with breaking the contract. Early cancellation fees can range from $0 to literally staggering numbers. Read your contract thoroughly! Again, some providers will offer no term contracts with no cancellation fees. Keep in mind that they may be jacking up your rates to compensate for all the work that goes in to underwriting and accepting the risk of processing cards for your business.

6. Point of Sale System Support

If you are using a Point of Sale system it is very important to find out if the merchant services provider offers support for it. Some POS systems are only supported by specific processors and some charge huge fees for switching the processor that you have on record (Especially if the POS system is provided by the processor itself). Make sure you know exactly what the cost would be with switching your software and find out who is going to pay for it. You may be able to negotiate the fees with the provider depending on how badly they want your business!

7. Reputation

Make sure that whoever you decide to do business with is a reputable company. More importantly make sure that there are no complaints posted all over the internet about the company. You will find that when a customer has a bad experience they will post about it in multiple places so if there is a complaint about the company you should be able to find it rather easily. Keep in mind that the size of a company is not as important as the service it provides and the cost of the service. Sometimes a smaller company is a better option to do business with because they are more eager to have your business and will offer better pricing because of low overhead.

Stop Working In Your Business

My client and I were talking about a challenge that she has been having around growing her business. She is an accountant and is often under tight deadlines. On top of the "deadline" work there is constantly other new work coming in. She works hard to make sure that all of her clients' work is done; however, the marketing, business growth and day-to-day admin work often fall through the cracks. On top of that she was feeling unfocused and that she was just chasing after deadlines all day.
I like to categorize these activities as "IN" your business, "ON" your business and "ADMIN". Unless you continually move these three areas forward you will not have a sustainable business.
In an ideal world you'll have plenty of support to help you, but the reality is that at the end of the day a lot of it simply falls to you to do. So how do you do it?
Here's a straightforward approach my client and I came up with.
1. At the end of each day review your "to-do" list and identify your top priority in each of these three areas ("in" your business, "on" your business, admin).
2. Be sure that these three things are very specific and are single tasks (none should take a full day on its own). If you're thinking about a project, be sure to identify the part of the project you are doing.
3. Create a list with ONLY these three things on it.
4. Review your list at the beginning of each day and get to work focusing on these three things only.
5. Review your list around lunchtime to make sure that you are still moving these three goals forward.
6. At the end of the day reassess and plan out tomorrow.
After we created this plan I shared some bad news with her... it wasn't only her "in", "on" and "admin" activities that weren't getting done. She was neglecting herself too. We agreed to add one more category to the list... "PERSONAL". What was one thing she wanted to do for herself each day? Some ideas we came up with were spending time reading a book, playing with her dog, gardening, taking a long bath and enjoying a dinner with her husband.
She's been doing this exercise for a week now and is finding herself much more focused. She also said that she's spending time "ON" her business and doing admin work each day.
Here are a few tricks she's learned to make sure the system works:
* Hang the list up so that it's visible and refer to it often.
* Don't overload any one area.
* There are times when one area seems to get short-changed. As long as you move each area forward a little bit it's okay. Just shift that balance back the next day.
What four things are on your list for today? Make it happen!

Carrie Greene is a speaker, trainer, coach and author of Chaos to Cash. She helps entrepreneurs cut through the confusion and chaos surrounding them so they make decisions, stop spinning and procrastinating and make more money.

Allowed Expenses for Tax Deduction

Did you know as a business owner of a sole proprietorship, you will pay a self-employment tax? Your business expenses can help off-set this tax. What can you deduct?

• Car expenses (gas, repair, maintenance, taxes, tag fees)
• Building expenses (lights, water, internet) a percentage of this if it is a home business
• Cell phone (if used more than 50 percent of the time)
• Clothes and dinning (if you can prove they are needed for business)
• Equipment (will deprecate over time and can be deducted it until sells or has no value)
• Supplies (are used up on a regular basis)
• Accountancy and professional fees
• Logo'd uniform
• Advertising
• Insurance
• Postage
• Safety Wear - such as a safety Helmet

All of these are included on a different line when you itemize your expenses. Keep track of these expenses all year long. Keep logs of money spent. You memory will not be reliable when it comes down to every penny. Certain deductions require proof that they were indeed needed for business (clothes, dinning, hotels, etc.).

Here are few do's and don'ts about tax deductions.

Do keep all gas receipts and a mile log.
As a sales person going from place to place each day, keeping a mile log really pays off.

Do keep money earned from the business separate from personal money.
Two accounts are better than one when it comes to owning a business. There is a chance you could get audited if you are still earning a check outside the business and don't keep it separate to track money from both sources.

Do keep a log of all you meetings.
Your need for clothes or dinning expenses will match your meeting log. If you are on a business trip and buy memorabilia, you cannot deduct that purchase on your taxes.

Don't throw all your paper into a bin for the whole year.
Your memory will not be reliable in 12 months to remember what dinning receipts went with which meeting and who you saw.

Don't try to deduct luxury items.
Your car washes, carpet cleaning, and office decor are not tax deductible. If you try to include these things in your expenses, you may red flag your account and get audited for sure.

If you are unsure if an item is deducible or not, consult an accountant to be sure.

Judge the Book by Its Cover

I often hear the analogy "the mechanics car doesn't run", or "the housekeeper's home is the dirtiest house". Is that the standard you want?

When hiring any professional - be it to work on my car, in my home, or in my business I treat their entire presence as their resume. If I drive into a mechanics, and there are broken and battered vehicles in the employee lot, I look for other signs that could show me what type of business this is. Are the employees happy? Well groomed?

The same holds true to the people you invite into your business. Do you practice the same due diligence here that you would when entrusting your car or your home with someone? Would you hire an HR firm that has high turnover, or pending or past law suits from current or ex-employees?

We tend to buy from people we like. A good salesperson will be able to establish the rapport, and build the bridge of trust with you. You trust that salesperson. Do you have confidence in the company they represent? When spending a few hundred dollars, or many thousands, I encourage you to practice your due diligence on the company you are hiring. Interview them the way you would a potential employee, as in essence that is what they are.

Here are some quick tips:

1. Google them - look for complaints - both unresolved and resolved.

a. Google them with lawsuit at the end of their name.

b. Google the owner's name(s).

2. Check with their local BBB.

3. Do they have client testimonials? Call them.

4. Look for industry specific websites or forums - for instance if you are hiring an HR firm, look at their reviews on Glassdoor. Look at their job postings to assess their rate of turnover.

5. How current are the articles on their website? What do they say? Do they reflect the vision of the company?

6. Look them up through their local Clerk of Courts website, for legal actions, or filings.

If any of these points reveal anything, that is your clue to dig deeper. You may still choose to do business with them, but at least you know who you are dealing with.