Application of Cloud Computing in Companies

Application of Cloud Computing in Companies

Savo Stupar (School of Economics and Business, University of Sarajevo, Bosnia and Herzegovina), Mirha Bičo Ćar (School of Economics and Business, University of Sarajevo, Bosnia and Herzegovina) and Elvir Šahić (School of Economics and Business, University of Sarajevo, Bosnia and Herzegovina)
DOI: 10.4018/978-1-7998-2725-2.ch004


Cloud computing is a new technology that represents the realization of an old idea that computer data processing is executed and charged as a service. The goal of this chapter is to define the basics of the cloud computing concept and how this technology works, and then explain where is all the data that cloud computing uses, how they are distributed, how and to what extent are available, who are the ultimate beneficiaries, what are the advantages and the disadvantages of applying this concept. This cloud computing model consists of five essential features, three service models, and four application models, and the elaboration of these concepts will be an integral part of this chapter. Particular attention will be paid to the possibility of data abuse in cloud computing and regarding that data protection against manipulation from service providers as well as the financial aspect of cloud computing.
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Cloud Computing - Conceptual Determination

Before 8 years, National Institute of Standards and Technology: U.S. Department of Commerce (NIST) defined cloud computing as a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction (Mell, & Grance, 2011). Model of cloud is usually described (as in Figure 1) with five important characteristics, three fundamental model of services and four models of implementations (deployment models).

Cloud Computing is actually a realization of the idea that computer data processing is done and billed as a service as it is with utilities, electricity or water delivery. Although the idea has existed for half a century (since the 1960s), it was not possible to realize it earlier because of the absence of technological conditions. With the development of information and communication technologies (since the 90s of the 20th century), the prerequisites for the realization of this idea have emerged. The full implementation of Cloud Computing required adequate infrastructure made up of the Internet (as a basic premise) and servers, networks, protocols, data warehouses, applications, etc. (Buyya, Broberg, & Goscinski, 2011, pp. 3-7). Today, most of authors agree that Cloud Computing technology (together with mobile computing and Big data) is one of the key technologies that support the Industry 4.0. (Bauer, Schlund, Marrenbach, & Ganschar, 2014, p. 16; Nagy, Oláh, Erdei, Máté, & Popp, 2018, pp. 3-8; Roblek, Meško, & Krapež, 2016, p. 6)

Figure 1.

NIST definition of Cloud Computing-a (CabinetOffice, 2011, 7)


Key Terms in this Chapter

Pay-as-You-Go Principle: Is a principle in which a person or organization pays for the costs of something from the moment they occur, rather than before or after, or only pays what they spend.

Virtualization: Is the consolidation of operating systems deployed with several physical servers into one physical server for the better utilization of computer infrastructures (resources), that is, enables their simultaneous use in different systems. Computer networks, programs, and operating systems are virtualized.

ERP System (Enterprise Resource Planning or Enterprise Resource Planning): Is a business information system, that is, a commercial software package, that enables the integration of the complete functioning of the business system (all business functions of the company) with a unique software solution. It has the ability to adapt to the specific needs of the business, but often does not support local standards. The most famous packages are: SAP, Oracle, Baan and Microsoft Dynamics or NAV (Navision)

IT Infrastructure: Everything necessary in the field of information technology (hardware, software, computer networks, network and other protocols, standards, etc.) to develop, test, deliver and implement, monitor, control or support IT services.

Supply Chain Management System (SCM): Is a software package that provides IT support to a process consisting of a series of activities (strategic planning, control and coordination) necessary to deliver ordered products from supplier in a timely manner and at the lowest cost to the end user.

System Scalability: Is the ability of a system to adapt to increased processing requirements in a predictable way, thus solving the problems of excessive complexity, costly and impracticality that occur in systems that do not have this capability. Universally speaking, scalability is the ability to grow, expand, upgrade a particular phenomenon without compromising its basic characteristics and functions.

Virtual Machine (VM): Is a guest machine simulation, which is usually different from the host machine (on which the simulation is performed). Virtual machines can be based on the specification of a hypothetical computer, or they can emulate the architecture of a computer and the features of a “real” computer. Earlier, software virtualization was used to switch hardware virtualization after the AMD-V Athlon 64 processor was built. Newer PCs have built-in hardware virtualization support.

Customer Relationship Managemenet (CRM): Is a customer relationship management software, that is, a strategy used by companies to manage and analyze customer interaction data with the primary goal of meeting their needs during all customer contacts and then maximizing business benefits and company's profits.

Web hosting: Is the location where the website of an organization or individual will be physically located on the Internet. There are four types of web hosting: shared hosting, private hosting, virtual private server (VPS) hosting, and cloud hosting.

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