Cloud computing: the silver lining for recession-weary SMEs?

14 May 2009

Irish SMEs are increasingly adopting cloud computing in the current economic environment as they look to maximise customer service, retain customers, manage the sales pipeline more effectively and lower overall costs, said yesterday.

The company said the proof of this is in some notable customer wins it has notched up, including Bolgers, Searsons Wine Merchants and Pure Telecom.

“The credit crunch is affecting all sectors, and Irish SMEs are looking for less risky alternatives to traditional expensive on-premise solutions that lock customers in. The cloud computing model offers many advantages,” said Steve Garnett, chairman EMEA,

“There is no large upfront investment in hardware or software, and applications are scalable up or down as changing business needs dictate.”

Garnett added that in the current economic climate, SMEs face more competition for less business. Companies need a tighter grip on operations and expenses. Cloud computing makes IT solutions available and affordable, to even the smallest company.

“As markets tighten and competition increases it makes greater sense than ever to retain and sell more to existing customers while managing your new customer pipeline more effectively.

“Research shows that it costs between five to seven times more to sell to a new customer than to an existing customer. And if you are not selling to your customers you can be sure that your competitors are,” said Garnett.

Analyst David Bradshaw, research manager at IDC, has positioned himself as a strong defender of cloud computing in the current global financial economic climate. He stated recently that “cloud computing has advanced greatly in Europe and the economic crisis is probably going to increase this rise.”

One of’s new customers, David Sheil of Pure Telecom, said that ease of implementation, no capital investment costs and rapid return on investment were the key points and driving force behind its decision to embrace cloud computing.

“Cloud computing solutions allow smaller companies such as us to embrace the benefits of enterprise software, without the back-breaking costs or resource requirements associated with on-premise software.

“This is a low-risk investment for us, particularly in such a volatile market. Customer service is critical for us and we believe that the implementation of Salesforce CRM will boost customer satisfaction and better position us against our competition in these challenging times,” Sheil said.

By John Kennedy