Cloud computing, that recent IT evolution, has been hailed as a boon to business continuity plans. Indeed, it has a lot to offer, including IT network redundancy, reduced costs and flexible billing. For these reasons, it immediately scores over traditional hot or cold mirrored data centres with more substantial initial and ongoing costs. Naturally, adequate measures still have to be put in place to make sure that risk and operational performance are acceptable; in some instances, the wholly owned backup data centre still has a role to play. However, cloud computing may still mean two disadvantages that cost more to organisations than they bargained for.
The first is in the loss of in-house IT competence that could otherwise help an enterprise to gain competitive advantage. Business continuity plans do not always take such a cost into consideration, but the longer it endures, the longer or the more efforts it takes for a company to compensate. The underlying considerations are not new. They already existed for example when SaaS (Software as a Service) started up: anything that is of strategic importance to a company’s operations may be better left within the company, even if the auxiliary elements are outsourced.
The second is the potential cost of reinstalling services and operations within the organisation, if required to do so by new regulations (tighter information privacy laws being one example). In some cases, such regulatory developments can be predicted as part of business continuity plans. In other cases, the cloud services provider may have a general policy of keeping up with such requirements, where possible. However, as the financial sector as seen, regulatory requirements can come thick and fast. Having to upgrade, redo or scrap IT solutions because they no longer conform to the law can be an expensive business.