The first question you need to answer is whether a cloud computing solution is right for your business. For many small and mid-sized businesses, or start-ups, managing computer systems and networks can distract from running other, more fundamental aspects of running a business. Between computers that crash, software that needs to be upgraded, and morphing security risks from Internet connectivity, it’s a full-time job. If you don’t have an IT department or you don’t have the resources to grow that department, it may make more sense to outsource some of your IT needs. That’s one reason why the concept of cloud computing is so appealing to a growing number of companies.

There are other business benefits to cloud computing, as well. Cloud computing providers can often offer businesses lower prices for access to more sophisticated technology because you share those IT resources with other companies, thereby reducing the overhead costs to the vendor of licensing software or buying servers. In addition, the pay-as-you-go nature of some cloud computing contracts enables businesses to pay for only what they use — if only five staff members need access to the financial software, they can pay for only those five people instead of buying a license for 100 users. Many contracts can also allow businesses to ramp up quickly to help facilitate quick growth.

In order to achieve these benefits, business leaders need to understand what types of cloud offerings would be most suitable, what the company’s needs are, and which vendors offer the best fit.

These are a few of the different types of cloud computing offerings:
•    Infrastructure-as-a-service: This used to be known as “utility computing,” wherein the vendor supplies the network and servers and your business uses that infrastructure and pays for what it uses in terms of capacity and storage.
•    Platform-as-a-service: The vendor provides and manages for you the operating system and the database and everything else you need to run certain platforms.
•    Software-as-a-service: This option involves the vendor running your software application for you, so that your business doesn’t have to buy a software license from Oracle or Microsoft or other providers.

Once you determine the type of cloud service is most suitable for your business, the next step you need to undertake is to determine your company’s needs. “You should start by doing a workload analysis,” says Ralph Presciutti, a partner in the technology practice at Tatum, an executive services firm. “How much computing power do you really need? You might have an infrastructure with 100 servers, but you have to ask yourself, ‘Am I really using that much power?’ The national average is that two to 12 percent of all computer resources are utilized.”

On the infrastructure side, you can hire consultants to help you determine your needs. In addition, some companies, such as VMware and Cirba have products that can help businesses determine server needs.