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Tangled web

Information technology has always been a challenge for small businesses, in a much different way than for enterprises.  Enterprises usually have dedicated IT departments and staff handle the procurement, configuration, and maintenance of network infrastructure, hardware systems, and software that is used by the enterprise.

Small businesses are different.  Typically, they have a few IT people that can perform several functions, but they are commonly focused just on maintenance and operations.  There is no time or budget to have IT help as a partner with strategic issues such as new marketing campaigns, sales efficiencies, or supply chain management improvements.

Traditionally, small business instead will turn to a value added reseller (VAR) or managed service provider (MSP) to handle common IT tasks.  If the small business is lucky, it can afford to have IT consultants help with some small projects.

The past few years have seen an explosion of cloud service offerings that have changed this traditional IT-SMB dynamic.  Businesses can easily buy cloud services for CRM, project management and accounting with just a credit card.  So the barrier to IT entry for business has been lowered significantly.

Unfortunately, a little cloud here, a little cloud there becomes a challenge for IT to get hold of all the cloud services that make the business run.  Is there redundancy?  How do we get the billing app to talk to the finance app?  Did anyone check with legal to see if that SaaS provider is compliant with our policies for holding customer data?

Sometimes this can be alleviated by getting a "best of suite" cloud solution so that it is easier to manage user accounts.  But how often does "best of suit" meet all of your unique and customized needs?  Wouldn't you want to select your own "best of breed" components? 

Your accounting team would want these services from a single vendor on a single bill.  Your IT department would want a single management portal for administering users and licenses and monitoring the services.  Everyone will want a single place to call for support for all their cloud service needs.  Oh, and all these services must be able to seamlessly talk to each other, sharing data and supporting single sign on (SSO).  This is the driving force behind cloud service brokerages

Enter the Cloud Service Brokerage

A cloud services brokerage (CSB) is an intermediary that aggregates and integrates cloud services for other businesses.  They are a trusted advisor to SMBs that know the business, the budget, and the challenges. 

Traditionally, this role has been filled by value added resellers (VARs), managed service providers (MSPs), or systems integrators.  A CSB is effectively all three of these capabilities, enabled by technology to quickly and cost effectively deliver unique and valuable cloud solutions to businesses.

Just like a VAR or MSP, a cloud service broker works with large, trusted companies (in this case, cloud service providers) to purchase services on a wholesale level.  The CSB then creates a platform, incorporating ecommerce, service management and integration capabilities to form a marketplace to offer cloud services.  These services come from different vendors, but can be ordered and billed together, managed together and integrated together to share information and support single sign on (SSO).

Cloud Services Brokerage Model

Cloud Marketplace

If you have a smartphone or tablet, it is easy to find the app store for your device and browse for the latest applications for fun or productivity.  If you are like me though, you typically find the most useful applications either through a friend or somewhat accidentally while trying to search. 

Cloud services for businesses are much more complicated to find.  If you are fortunate, you have an IT staff or trusted IT provider that has recommendations.  But even if these recommendations come from IT, do they meet your unique needs?  Does your systems administrator know the difference between CRM capabilities for sales force automation and customer support management? 

For SaaS based CRM alone, Gartner has identified 32 different categories of CRM, totaling more than 80 vendors!  A cloud marketplace is the perfect place to discover, compare, and review the various cloud services that are relevant to your unique business needs

Cloud Integration

Integration of services is a huge challenge for SMBs.  They cannot afford the cost for software consultants to integrate their enterprise resource planning (ERP) system with the customer relations management (CRM) system.  So some systems integrators will offer cloud services with pre-defined adapters created for cloud services, which makes it easier for integration projects.  These adapters perform authentication and authorization, data mapping and transformation, applying business rules or executing business processes.

Other solutions, such as Boomi or SnapLogic provide development tools for SMBs to create their own integrations.  But if you do not have development staff, or budget for systems integrators, these capabilities are still outside the reach for small businesses. 

The alternative of CSB Marketplaces are starting to appear, with adapters for cloud services and pre-integrated solutions for specific industry verticals, reducing the technical barriers for integrating cloud services.

Cloud Management

After purchasing and using your cloud services, you are also going to need to manage them.  A management portal can track which users have what permissions to specific services.  This allows IT and business management to control sensitive data, deactivate services for employees that are no longer with the company, and avoid overpaying for services they are not using. 

In-house IT departments will want to monitor cloud services proactively, checking network connectivity and service availability.  Solutions like Nimsoft and CopperEgg provide these capabilities.  A cloud service brokerage can provide tooling and APIs to the various cloud services to provide an aggregated systems management view. 

Support

In working with a cloud service brokerage, you are outsourcing much of the complexity of the cloud to a provider that understands your business and is committed to your long term success.  After all, almost all cloud services are paid for on a monthly basis with no long-term commitments or capital costs.  This creates a low barrier to exit for customers of CSBs – if they are not getting the services, pricing, and support that they need. 

A cloud service brokerage is the first and best line of support for any issues you have with your cloud services.  After all, they assisted with the selection of the services, they bill you for all the services and they have integration with the cloud service providers for activation and management.

Summary

Cloud computing has changed the delivery model of IT services to businesses, resulting in more options, tailored solutions, and rapid time to activate and start using cloud services as part of your business.  The cloud service brokerage model is taking many forms, depending on the technologies used and the businesses they are serving. 

For small businesses, a cloud marketplace can be a place to learn about different options and provide the ones you need, when you need them.  This saves you time, money, and frustration and enables you to focus on running your business.

Disclosure: Verecloud operates Cloudwrangler, the app store for small businesses, powered by Verecloud's cloud service brokerage engine.

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