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What is the Cloud and How Can It Benefit My Business?


Many small business owners are using cloud-based systems. Great! So, what is the cloud?

First of all, the cloud is not really an object in and of itself. It is a way to share services, programs, or data storage without having to pay for the programs or host it all on your own system. So, what is the cloud, and why does everybody talk about it? The cloud can host programs, applications, or even just data storage. In addition, it can even allow businesses with remote workers to collaborate and work together on shared files.

Hosting and Storage

So, who hosts cloud systems? Some systems are hosted by a business and are used only by the employees of that particular business. Others can be used by the public at large for free (for example, GoogleDocsTM or Yahoo® Email), and yet others can be used for a fee (such as Paychex Accounting OnlineSM or a paid email account). Those that are free or are for paid public use are hosted by various companies who may own and operate large networks of computer systems located all around the world.

Chances are that you have already used a cloud system, but may not realize it. Email servers and company websites are cloud systems. In addition, if you have a personal blog, use an online movie site, or have an online backup account, you have used the cloud. Some other cloud-based options are also in the area of data backup and storage. All of one's photos and important documents can be stored in a cloud account, safe and sound. Backup hard drives often have programs which are difficult to use, or may be incompatible with the main system. In addition, these physical drives should be stored away from the physical location of the data in the event of a disaster.


Many small businesses have begun using cloud-based programs, so they do not have to pay for a program, system maintenance, or tech support. In addition, several employees can use the system at the same time, thus allowing a more efficient workflow. The ability to access company data from any location with an internet connection is also great for small companies with fewer employees, who may be on the move, working from home, or at a client's office.

There are a variety of cloud applications available for businesses today with features to meet their specific needs.

  • Project Management—Mavenlink ( is a very helpful cloud-based project management board. This tool allows all people who are involved in a particular project to post messages to their planning board so that the other parties to the project can stay updated and ask any questions without the necessity of speaking to each other directly.
  • Collaboration—Thistopic could probably be lumped in with project management, but there are some times when different individuals need to view, manipulate, or edit the same document. GoogleDocs allows multiple users to work on the same document from different locations.
  • Virtual Office Services—Ringcentral ( eFax® ( two great remote fax apps. There is no need to have a fax machine, and all faxes go directly to your laptop or computer. And, the sites also store received faxes for a rather lengthy time frame so that if you accidentally delete or misplace your fax, you may retrieve it again.
  • Accounting and Payroll—There are numerous online accounting programs available to business owners, such as Paychex Accounting Online ( A little investigation may reveal which programs can best meet business needs.
  • Document Storage and Retrieval—Dropbox ( is a popular document storage site. Users can be invited to view certain documents in a box, and even add, delete, or move documents as well.

Potential Drawbacks

One of the main drawbacks of cloud-based systems is that hackers do exist, and they're obtaining information for any number of nefarious uses. However, large, trustworthy companies will most likely be equipped with firewalls and other security measures to prevent such attacks. Security is another area where the consumer needs to do their homework. If there is any sensitive personal or business data that is going to be sent to the cloud, it should be determined what type of security is installed in the framework of the hosting company.

Then, of course, is the fact that there must be a live internet connection in order to access your data. But, as online connectivity continues to grow, this issue becomes less of a barrier to taking advantage of the cloud. Thus, cloud-based systems have become increasingly popular. More businesses every day are using them to cut costs, increase efficiency, and operate beyond their immediate neighborhood, so they can compete in the global marketplace.


This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.
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