SMBs must limit number of cloud suppliers to reduce financial drag

Small and medium sized businesses [SMBs] should be doing more to ensure all cloud services are coming from one firm in order to reduce the financial drag caused by having too many cloud apps.

Related: UK SMB cloud market to top £2bn by 2016

A report published by Osterman Research suggests that the current average of 15 cloud-based apps per SMB is too high and that it is having an adverse affect on productivity that is particularly acute in the smallest firms.

Michael Osterman, founder of the company bearing his name, expects this number to increase over the next two years as there is such “a huge number of applications out there”. This will eventually result in the average number of apps reaching 18-20 over the next two years.

This will undoubtedly create more problems of the same ilk and the four major problems that come from the large number of apps, as identified by Osterman Research, are: too much choice, too much to manage, too many logins and too much risk.

All of this results in a high level of financial drag inside small businesses that adds up to a cost of $15 [£8.78] per employee per month, on average, and would be solved by using one vendor and having all costs itemised on a single monthly bill.

“Finance starts complaining about managing all the vendors. Users tire of remembering complex passwords and take insecure shortcuts. IT plays endless whack-a-mole with integration issues. The IT guys feel like crying, but they no longer have a server room to cry in. Finance only has to pay one monthly bill and manage one vendor relationship. IT only has to work with one company for orders, questions and customer service,” stated the research, according to Cloud Pro.

Related: Global SMB cloud spending will top $125b by 2016

Bring your own device is another facet that small firms are having to combat and a strand to this is when people download their own apps to use at work, also known as bring your own app, and this is expected to spell security trouble for SMBs.