“Cloud Computing – Is it all silver lining?”

20 June, 2016

Cloud computing can potentially bring huge benefits to the food processing industry, writes Elliot Fry, an associate and technology specialist at law firm Cripps Pemberton Greenish, but there are risks, and they must be effectively managed.

Used to describe a variety of products and services, cloud computing generally relates to an internet (or network) based means of providing shared resources (such as storage, software or processing power) on demand. If you’re not sure why that might be useful to your business, think of the difference between a Netflix subscription and a shelf of DVDs. Cloud computing can offer cost reduction, simpler maintenance, and greater flexibility, scalability and reliability. As more and more business processes become automated and interconnected, the benefits of a manufacturer moving its IT systems to the cloud increase.

The ability to effectively outsource the responsibility for running hardware and software to the internet – and passing the hassle of maintenance and upgrades to the cloud computing provider –is clearly an attractive option. Food processors need accurate information quickly, and being able to access real-time data from a PC, laptop, tablet or smartphone from any location with internet connectivity can help staff pre-empt problems and optimise performance. Staff would not necessarily have to be based on site, but could offer assistance to multiple sites remotely.

As with any service, food manufacturers need to ensure they have the right protection in their agreements with providers to (among other things) monitor cost, maintain appropriate output levels and enforce security. Cloud services will typically be charged on the basis of usage, rather than at a fixed cost. So whether that’s the amount of storage you use, the users you have licences for, or the number of items you process, you’ll need to consider what your anticipated usage will be before you commit to a pricing model. Anybody stung by a mobile phone contract has probably already learned this lesson.

Service levels will often revolve around accessibility. Having a vital business resource available for all your employees is no good if they can’t access it when they need to. Providers should be held to minimum standards, which need to be examined carefully to ensure they meet your requirements. Timing is often crucial in the food sector – and downtime is costly – so if there is a problem with the service, even for a short length of time, the knock-on effect through the supply chain could be considerable. To compensate, agreed financial consequences in the form of service credits are included in many cloud computing agreements.

The security aspect of cloud computing has discouraged many businesses from fully embracing this model. With the number of data security breaches hitting the headlines, it’s not hard to see why. While food and beverage manufacturers do not generally hold much personal data, they do hold huge quantities of sensitive business information and any breach of security could be disastrous. It’s vital to ensure cloud providers (especially those involved in any way with sensitive or confidential data) are subject to clear and robust security obligations, including potentially the ISO 27000 family of information security standards. Appropriate remedies in the event of any data breach or loss should also be included.

For any manufacturer looking at using a cloud service, the key to getting the most out of it is doing your homework. Having a list of requirements and checking your provider fulfils them before you engage in any discussions should help you get the most out of the cloud as well as making the whole process quicker, cheaper and easier. Clearly setting out those requirements in your contract also reduces the risk of ever having to take enforcement measures.

For more information, contact elliot.fry@crippspg.co.uk.