What Business Leaders Should Know About Cloud Computing: Cloud Computing for Digital Business

What Business Leaders Should Know About Cloud Computing: Cloud Computing for Digital Business

Tomislav Videc (Oman Arab Bank, Oman), Jovana Zoroja (Faculty of Economics and Business, University of Zagreb, Croatia) and Mirjana Pejic-Bach (Faculty of Economics and Business, University of Zagreb, Croatia)
DOI: 10.4018/978-1-7998-2799-3.ch014

Abstract

Cloud computing represents a popular and frequent notion in media and scientific research. However, in post-transition countries, there remains a low offer of cloud computing solutions and users have not still accepted this concept besides its broad spectrum of benefits. This chapter examines the possible reasons why, despite high media attention, there are not many examples of using cloud-computing solutions by companies in post-transition countries, using Croatia as a case study. For that purpose, the survey among Croatian enterprises has been conducted regarding cloud-computing usage in business. Collected data is analyzed using knowledge discovery from databases aiming to define firms' readiness when using cloud-computing solutions. Results indicate that Croatian enterprises recognize the value of cloud computing as a software-as-a-service, but significant barriers are present in terms of slow recognition of its business value. Steps for overcoming this obstacle are proposed in the chapter.
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Introduction

Productivity and complexity of doing business has been increasing every day because of development and usage of modern IT products and services. Companies that are using advanced IT solutions are leaders on the market and have higher competitive advantage compared to those who are lagging behind regarding IT applications. Companies should be ready to implement new technologies and to adapt daily to new business concepts based on new and innovative IT solutions such as cloud computing. Researchers predict significant growth of new market segment, which provide usage of existing technology in new business models, which enable more effective resources usage and time, invest in developing new and complex systems. In other words, instead of buying new system, the existing systems has been rent and paid by exploitation.

Software as a service is a new business model of application usage that alters classic application procurement with leasing systems of the same or similar functionality. This step in evolution does not represent technological advancement, instead, it is about renting a service, and the charge is directly related to the intensity of use. The technology used in such solutions allows for a dynamic increase in the available resources who act as a substitute for investment in the case of software as a service and cloud computing. This is extremely important in times of crisis when every investment is a major effort for an organization. A new way to use IT resources is to make cloud-based solutions and software as a service available to small and medium-sized businesses and new businesses that lack enough financial resources. This enables the entry of high technology and the latest business solutions into the most fragile part of the market that makes best use of available resources through inventiveness and adaptability.

Cloud computing and software as a service presents evolution in using IT at new and innovative level. One of cloud computing definitions is that final user via Internet can get service of data processing and data saving while he is familiar with all its functions (Zhang et al, 2010). The main reason for new business models are high costs of IT usage and complicated process of implementing new technology solutions in business processes. Cloud computing is not new technology, but usage of existing technology solutions and principles in new business models where is important to use existing applicative and infrastructure resources.

Previous research has indicated a strong relationship between the utilization of technologies and competitiveness of countries, companies, public organizations and individuals (Zoroja et al., 2016; Ollo- López et al., 2012). The same refers to cloud competing, which has been found as a key-technology for increasing competitiveness, both at company and public-organizations levels (Murugesan, 2011). However, most of the research of about cloud computing has been focused to developed countries, such as Ireland (Carcary et al., 2014) and overall European countries (Zaharia-Rădulescu et al., 2017), while the research on cloud computing in developing countries is still scarce (Yeboah-Boateng et al., 2014). Previous research on cloud computing in developing countries can be grouped into two broad groups. Frist group of the authors have investigated different aspects of cloud computing, such as motivations (Sharma et al., 2016; Hachicha et al., 2018; Hailu, 2012), and determinants of adoption (Mohammed et al., 2016; Abubakar et al., 2014). Second group of authors focus to the various aspects of cloud computing in specific countries, such as Nigeria (Dahunsi et al., 2015), or regions, such as Africa (Shaw et al., 2014). Gital et al. (2011) investigated the usage of cloud computing in higher education in Nigeria. Tijkongo et al. (2013) investigated the viability of cloud computing for SMEs in Namibia. Utilization of cloud computing in post-transition European countries is to our best knowledge not available in previous research, although other researchers have focused to different technologies, such as information systems overall (Kokles et al., 2015; Piotrowicz, 2015; Keszey, 2017; Lech, 2019), and specific technologies, such as business process management (Gabryelczyk et al., 2018). In order to shed some light in the area of cloud computing in post-transition countries, we focus our research to utilization of cloud computing in Croatian companies. Croatia is a post-transition country that has recently been accepted as the 28th member of European Union, and is still struggling with competitiveness at the global level, which indicates that it is a good representative of this group of countries.

Key Terms in this Chapter

Software as a Service (SaaS): Represent the evolution of using IT in a new and innovative way and this service is also knowen as Web-based software.

Cloud Computing: Represents a popular and frequent notion related to on-demand availability of data storage.

SWOT Analysis: Represent a planning method which can facilitate managers to identify strengths, weaknesses, opportunities and threats related to business processes.

Cluster Analysis: Represent a method of grouping selected variables where objects in the same group are similar and differ to those from other groups.

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