Analyzing Implications of Cloud Computing in Business & Finance

This report delves into the multifaceted implications of cloud computing on business and finance. It begins by defining cloud computing and outlining its evolution, types, and working mechanisms, including its role in information system infrastructure. The paper emphasizes the transformative im...Read More

Running head: IMPLICATIONS OF CLOUD COMPUT1
ING
IMPLICATIONS OF CLOUD COMPUTING IN BUSINESS, AND FINANCE
Pavan Alavala
December 12, 2020

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Abstract
Cloud computing is the process of delivering on-demand computing services taken
from the applications to storage places and the processing unit. Cloud computing is
done over the internet. This paper revolves around the knowledge related to cloud
computing that includes its meaning, working, types, and uses. Cloud computing is
applied in multiple sectors and its use is broad-spectrum. The main focus of this
research that is related to cloud computing is on the implications and impacts of cloud
computing on the business and finance sectors. An insight into the evolution of cloud
computing and its working in a security system is provided in the paper along with
some brief details about information system infrastructure.

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INTRODUCTION
The Information System Infrastructure provides a basis upon which well-
established information systems rely, it supports those changes that are essential for
the activities of an organization. The structure of information system infrastructure
comprises telecommunication networks, storage databases or data warehouses,
software, hardware, human resources and procedures, and some additional systems
that specialists manage (Gregersen, 2020). The purpose of information systems is to
collect data, store it in cloud computing, and process it into another form of data for
distribution to desired locations. The evolution of information systems is evident as it
has grown from a single system to an integrated system that is more efficient in its
working.
Cloud computing, on the other hand, delivers different services over the internet.
The resources provided by cloud computing to the information system infrastructure
includes different tools and applications such as information storage, servers, data
warehouses, networking, security, and software. The history of cloud computing goes
the back to early 2000s, but the concept of computing as a service has been around
since the 1960s. According to research, the infrastructure that supports cloud
computing is built with more than a third of all IT spending worldwide. The
workloads of computing have moved to the cloud including both, the public cloud
services that the vendors offer, and the private clouds that enterprises build
themselves for their use (Mansa, 2020).
Cloud computing is more than just an application to store photos and videos
online, it is a business model. Cloud computing has brought an evolution in the
business world as it has modified the ways by which many businesses stored and
accessed their data. Cloud computing has changed the operations of businesses as it

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has offered several advantages to not only the large businesses that sign contracts with
major cloud providers and receive the required services but also small and medium-
sized corporations that benefit from the services of the cloud. The importance of cloud
computing is demonstrated clearly as it offers flexibility in its operations, recovery of
lost data files from the data centers rarely requires maintenance, it is easily accessible,
and provides a much higher and efficient level of security to the businesses. Cloud
computing provides cost-effective services, it supports digital transformations in
businesses, creates in-house solutions for all sorts of problems, offers recovery and
backups to lost data, and provides effective business scaling (Rutherford, 2020).
Cloud computing has several benefits for its users, hence, for all businesses, the
transition to cloud computing is worth it.
DISCUSSION
Evolution and Trends in Cloud Computing
The term "cloud" has been derived from telephony, a Virtual Private Network
service that the telecommunication companies offered with better quality and
affordable prices. Today, cloud computing technology excellently manages multiple
servers and other network infrastructure management. Various computing
technologies such as grid computing, parallel computing, utility computing, and
virtualization have played an important role in the evolution process of cloud
computing. The most up-to-date advancement in cloud computing evolved from
Web2.0 technology, whose examples are wikis, blogs, social networking, etc. Cloud
computing is classified into the public cloud, private cloud, and hybrid cloud heads on
the basis of location, usage, and type. Also, for a better understanding of the evolution
of cloud computing, it is divided into three basic phases that are the idea phase, the
pre-cloud phase, and the cloud phase. The new trends in cloud computing rendered IT

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executives and entrepreneurs to adopt this technology and use it to achieve their
business ambitions. Some of these trends in cloud computing that would prove
beneficial for businesses in recent years are increased cloud storage capacity for
storage and protection of big data, better internet quality and faster networking due to
the rise of 5G and addition of IoE and IoT, the dominance of IoE as the focal point
over IoT and AI, and increased security for the protection of data from cyber-attacks
(Uschie, 2019).
Cloud computing is such an innovation that is an advancement of computing by
applying virtualization in a technological perspective, whereas, in an IT deployment
perspective, it is known to have the potential to revolutionize computing resources
and applications (Bohm, 2011). Due to the continuous growth of cloud computing, the
evolution of this technology will be backed up by certain trends that include
containers, tools to support cloud migration, hybrid solutions, and a growing focus on
cloud security.
Cloud Computing Security
Cloud computing security is a discipline of cybersecurity that consists of a set of
procedures, protocols, and techniques that work in coordination to protect the cloud-
based systems, data warehouses, and information system infrastructures. The security
measures are focused to protect the data present in the cloud, to support regulatory
compliance, and to keep the privacy of customers' data intact. Cloud computing
security measures provide configuration according to the exact needs of a business,
from offering authenticating access to filtering traffic to cloud security and others.
The widespread adoption of cloud computing by several corporations also poses some
security concerns to the data (Chen, 2010). Many organizations are concerned about

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security threats that are associated with cloud computing such as misconfiguration,
unauthorized access, insecure interfaces, and the hijacking of accounts.
These security concerns are overcome by cloud computing security that possesses
certain categories like protection of data, identity and access management (IAM),
governance that comprise of policies to detect, prevent, and mitigate threats,
plannings of data retention (DR), and business continuity (BC), and legal compliance.
A Cloud computing security system is designed to protect the physical networks, data
storage devices, data servers, computer virtualization frameworks, operating systems,
middleware, runtime environment, all sorts of information data, multiple applications,
and end-user hardware. The cloud computing security technology performs its
working efficiently to enable data recovery if any data is lost, to provide protection to
the storage areas and networks in cloud computing against malicious software and
data thefts, to prevent human errors that might cause data loss or leaks, and to reduce
the aftermaths if any system or data is compromised. Hence, cloud computing security
is important as it offers security against continuously evolving security threats and
also because the security protocols can be customized according to the infrastructure
of the business. Cloud computing security is quite reliable and provides centralized
security with many reduced costs and lesser administration (CyberEdu, 2020).
Cloud Computing Services
There is a wide range of services that are offered by cloud computing companies
and they can be majorly categorized into three types. First is the Infrastructure as a
Service or IaaS that offers its users uninterrupted access to those computing resources
that are raw like processing power, data storage capacity, and networking. The second
type is the Platform as a Service or PaaS that provides computing and storage
infrastructure along with a platform layer that includes components like web servers,

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database management systems, and software development kits (SDKs). The third type
of cloud computing service is Software as a Service or SaaS and it offers application-
level services that are constructed to meet a variety of needs of a business like a
consumer relationship management (CRM), marketing automation, and business
analytics. Several big companies like IBM, Microsoft, Google, etc offer cloud
services to their customers. The cloud services are diverse and for customers, the
decision to opt for any one cloud service is difficult so there is also a need for a
framework that might offer services according to the client's Quality of Service (QoS)
requirements (Garg, 2012).
The potential of cloud computing has immensely grown due to its optimal
utilization of resources, flexibility in its working, reduced costs, and elasticity.
Machine learning in the cloud has also several benefits for its users and the
applications of cloud computing have expanded to various computer and mobile
devices. There are several uses and advantages of cloud computing in action today,
but there are a few common cloud computing applications. These applications include
Platform as a Service (PaaS) and Infrastructure as a Service (IaaS), hybrid cloud
approach, testing and development, analysis of big data, cloud storage, data recovery,
and data backup (Goyal, 2020).
Cloud Computing in Business Sector
Cloud computing has proven to be beneficial in the business sector as it offers
businesses certain ways to manage their own computing resources over the internet.
Cloud computing is considered as a third party in the business field that has evolved
over the years to provide storage facilities and fulfill other computing needs of the
company. Cloud computing also allows businesses to have easy access to stored
information virtually as it is known to create a much flexible and global way of

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accessing the stored information at any place at any time (Madhavaiah, 2012). Cloud
computing offers several benefits to businesses that adopt it as it offers its users to set
up the virtual office that allows them the flexibility of connecting to their business
anywhere, anytime without any hindrance or loss of data. As the use of web-enabled
devices in the business environment has increased tremendously over recent years, so
cloud computing has made it easier to access data.
Some of the many benefits that cloud computing offers businesses include
reduced IT costs, adjustment of scalability, non-interrupted business, the efficiency
gained due to collaborative work, flexibility in work practices, and easy access to
automatic updates. The adoption of cloud computing also helps businesses as it is
easy to use and quite convenient to handle, it is much reliable and efficient in its
working, provides much better security, and offers a great deal of privacy to the
information stored in data warehouses, and shows better results in sharing and
collaboration. Businesses deploy all three major cloud services that are IaaS, PaaS,
and SaaS because they range from data storage to functional programs that also
include software for accounting, customer service tools, and remote desktop hosting.
Cloud services store the data related to enterprises and businesses using public cloud
service, private cloud service, or hybrid cloud service. It is necessary to adopt such a
cloud storage service from among these three that aligns with the size and needs of
the particular business (Martins, 2020).
Cloud Computing in Finance Sector
The positive impacts of cloud computing in some sectors of finance like
insurance and banking have proved their importance to other larger financial
institutions. Cloud computing has successfully helped these finance companies by
making their operations easier for them and performing their functions more

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efficiently. Cloud computing provides several benefits to the finance industry just like
it does to other businesses. The most important benefit is the provision of security,
and cloud computing is known to provide a highly resilient security architecture to its
users that get into action after it has gone through stringent security checking
protocols at regular time intervals. Cloud computing is cost-effective as it cuts down
the expenses of servers and other core IT infrastructure and also curtails the cost of
ownership and maintenance of the infrastructure. It also offers unlimited storage space
to the finance sectors for their big data and easily scales the resources without any
intervention or glitches (Admin, 2016). Cloud vendors take strict measures to make
sure that no compliance is violated when services are provided to finance industries.
Cloud computing has made working in the finance sector easier by offering
applications to the employees, such as CRM, that allows them to work on the go.
The finance industry adopts a mixture of cloud services and deployment models
for their business and IT needs. Banking, insurance, and analytics are the segments of
the financial community that adopts cloud computing for better performance of their
certain areas (McGrath, 2015). Cloud computing serves as a transformative digital
solution to the concerns of the banking and finance industry in providing the best
services to their customers. This technology offers unparalleled levels of data
protection, the privacy of clients' information, agility, and scalability to the financial
sector while enhancing its capability to work with big data. Cloud computing
technology improves revenues and operational efficiency in the banking industry.
Drawbacks of Cloud Computing
There is no denying the fact that cloud computing has offered benefits to several
organizations in achieving their goals but there are also some shortcomings to the use
of cloud computing that must be taken into consideration. Increased cloud network

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traffic beyond a certain limit can affect the working of the cloud. Data can be lost due
to a crash between servers and computers. Cyberattack is one of the major issues
related to cloud computing. Hackers can steal business data, user information,
financial reports, etc by compromising the security of cloud computing technology.
Some of these cyber-attacks include SQL injection, wrapping attack, authentication
attack, Denial of Service, etc (Xue, 2016).
Some other drawbacks related to the use of cloud computing include its all-time
dependency on network connections, bandwidth issues, limited features for particular
industries, limited control and flexibility, vendor lock-in, loss of function control,
possibilities of security breaches, vulnerability to attack, downtime, and technical
failures (Larkin, 2019).
CONCLUSION
It is fair to conclude that cloud computing has become a new normal due to the
numerous benefits that it offers to organizations. Cloud computing is making itself
more useful for future concerns of the businesses as it is assisting in managing big
data, cybersecurity, and quality control. Also, other emerging technologies like
artificial intelligence and distributed ledger technology are being offered as services
through cloud computing to enterprises. Despite the fact that there are certain
problems associated with the implementation of cloud computing, the benefits
outnumber them and new advancements in cloud technology might eliminate those
shortcomings. Hence, cloud computing can be considered as a transformational
technology that assists businesses and other organizations in different jurisdictions by
delivering their services and products in a much better way than ever before.

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