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I was reminded by a friend the other day that one of the keys to creating and maintaining a successful business is to focus on what you do well – your core business.  Its good advice but people still ignore it.

I keep running into companies that insist on running their software on their own hardware and administering the whole thing – or worse paying someone to do it for them.  Things like Exchange have become utilities in the new world of Cloud Computing – this is a wasteful approach.

Lets explore the concept for a moment with a real example.

Small Business
A small business who long ago bought a piece of hardware from their IT services partner that was loaded with Microsoft’s Small Business Server product – a scaled down version of several Microsoft Server skus put together in one box.  With 20 users this small business likely paid $8-10,000 or more for the piece of hardware/Software and has little or no expertise on staff to run it.  When the server has an issue (security patch crashes Exchange, or user downloads a virus, etc.) this small business is stuck calling the IT services firm to fix the issue.  If its a nasty issue the hours rack up at an extreme cost (usually more than $100/hour) and hopefully soon the business is back on its feet.  Unfortunately its checkbook is a bit lighter – possibly several thousand dollars lighter.

If the firm has a proactive management contract in place it will be paying several hundred dollars or more a month to patch and manage the server in addition to any downtime fixes or other issues that will rack up the IT service bills.

Product upgrades?  Security patches?  Downtime?  These all require paying an IT Service provider or trying to hack it out on your own.

Small Business Solution
For $100/month this same small business can run the same software in Microsoft’s professionally run datacenter (not their back room next to the mop bucket).  When downtime occurs, many engineers fully trained on supporting the product leap into action to fix the issue.  The cost to you for downtime?  None.  In fact if Microsoft violates their 99.9% uptime guarantee they credit your service for the downtime.

Isn’t this how a service is supposed to work – if there are issues someone pays you instead of the other way around.

-Kris

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