Four Biggest Risks of Cloud Computing and How to Mitigate Them

Nowadays, cloud computing is less of a buzzword and more a necessity. Everyone, from app developers and CEOs of global conglomerates to grey nomads and high school students, is benefiting from the flexibility and reliability of cloud-based solutions.

Business owner, IT manager or solo startup extraordinaires who haven’t embraced the cloud, there is no time like the present to jump full force into the future of computing. It could lead to serious time-saving, cost-cutting, and productivity-boosting rewards.

Although cloud computing has come a long way in recent years, there are still risks involved. But with a little forethought and planning, you can effectively mitigate these risks and enjoy all the ever-evolving cloud has to offer.

What Is Cloud Computing?

Cloud computing involves the delivery of computing services over the internet. Cloud-based services include:

• Servers

• Storage

• Networking

• Databases

• Software

• Analytics

• Intelligence

Benefits include reduced costs, scalability, remote access, speed, reliability, security, and more.

Biggest Risks of Cloud Computing and How to Mitigate Them

Migrating to the cloud can feel like a significant leap – but it’s one that most businesses will have to make sooner or later. Protect yourself, your customers, and your company’s reputation by recognizing the following risks and doing what you can to mitigate them.

Unauthorized access to data – Forty-three percent of cyberattacks are targeted at businesses. Threat actors make money by selling or exploiting employee and customer data, and businesses are data goldmines. What’s more, breach strategies typically evolve at a much faster rate than security defenses – cyberattacks are becoming more and more sophisticated, and IT teams are faced with the almost impossible challenge of keeping up.

Cloud service providers host data from thousands and thousands of customers, including businesses, concentrating the risk of a breach to one single point of failure. A successful attack could prove fatal for scores of companies across the globe.

It’s not just outsiders seeking to gain unauthorized access to your valuable data. Insider threats, too, loom over those that opt for cloud-based solutions. When outsourcing things like data storage to a third party, trust is shifted to their staff – as well as the vendors they outsource to – to do the right thing.

Mitigation strategy: There are several ways to minimize the risk of unauthorized data access. First, do research. Only work with a services provider with a proven track record. Second, encrypt data. Implement data encryption at rest to ensure that data remains secure in the event of unauthorized access via stolen credentials. Finally, maintain security best practices. Use strong passwords and enable multi-factor authentication.

Over-complicating your cloud network and blowing your budget – Technology is advancing quickly. Consumer expectation is evolving along with it. The sheer breadth of options – as well as the functionalities, benefits, and potential cost savings they bring – are mind-boggling. With this in mind, more than 92 percent of businesses are switching from a single cloud to a hybrid or multi-cloud strategy. According to a recent report, multi-cloud will be the norm by 2025.

The risk? Over-complication. When complexity increases, risk and cost increase, too. Just check out the graph above.

Mitigation strategy: Create an abstraction layer between complex systems and your users by automating management and monitoring. This will minimize the cost of multi-cloud maintenance and provide an improved operational experience.

Compliance and legal risks – Does the industry regulate data storage and security? Those operating in healthcare, financial services or government – or any organization that accepts credit card payments – may be subject to data regulations. For example, HIPAA requires all healthcare providers to protect patient data confidentiality. Similarly, PCI DSS requires any business that accepts credit cards to safeguard customer data.

Outsourcing the processing or storage of regulated data essentially means relying on a third-party provider to maintain compliance. What’s more, if a breach occurs that impacts a cloud storage provider, your company may be liable.

Mitigation strategy: Know your compliance requirements and be diligent. Understand your responsibilities and do not hand protected data to a third-party provider without ample research and deliberation. Cloud storage is a hugely beneficial technology – but it isn’t for all organizations.

Lack of control – Traditional, locally hosted services give businesses total control over the various features and settings. If you want to change the service, you can. If you want to keep it the same, you can.

When you use a cloud service provider, on the other hand, you are more or less at their mercy. They are ultimately in the driver’s seat. The features you use today could cost double next year – or worse, no longer exist. You may be forced to pay up if your customers or staff rely on the service. If your business experiences a significant roadblock and you can’t pay your bill, what happens? Will the provider hold your data hostage until you have sufficient funds? Maybe. Maybe not. The ball’s in their court.

Mitigation strategy: Understand the agreement terms of a chosen service provider. Beyond that, recognize that no form of data storage or computing infrastructure is 100 percent safe. Yes, a cloud computing provider may close up shop tomorrow, but a company’s office could burn down in a freak accident, too. It’s about weighing up the risks and taking the pros with the cons.

Michael Brenner is a keynote speaker, author and CEO of Marketing Insider Group. Michael has written hundreds of articles on sites such as Forbes, Entrepreneur Magazine, and The Guardian and he speaks at dozens of leadership conferences each year covering topics such as marketing, leadership, technology and business strategy. Follow him @BrennerMichael.

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