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Combating the Double Risks of Cloud Computing and Outsourcing

Combating the Double Risks of Cloud Computing and Outsourcing
October 30
16:34 2013

The Internet continues to level the playing field in a variety of industries. Small and mid-sized businesses have access to global labor and technical resources thanks to outsourcing and cloud computing. However, the same things that bring opportunity for success and growth also open the door to security risks and problems with compliance.

More Fingers in the Pie

In most cases, outsourcing increases the number of times each piece of work is touched. Work must be gathered, delivered, completed, returned, and reviewed. Many companies employ an extra level of internal audit on outsourced work in order to evaluate performance and measure service level agreements. Cloud computing also puts data at risk, since it increases the number of individuals who can see each piece of work.

Continuous process improvement initiatives like Six Sigma say that every time an item is touched, there is an increased opportunity for defect creation. In this case, companies should be worried about an error in the process that exposes data inappropriately or creates a compliance issue.

To mitigate the increased chance of error in an outsourced or cloud environment, make sure workflows are as automated as possible. Manual routing and validation of work adds an unnecessary step in many processes, and can result in compliance or security issues if items are misrouted or neglected. Streamline processes as much as possible without sacrificing quality. Companies should also train staff—both in house and outsourced—to protect data via stringent password policies and smart use of the Internet.

Cross-Country Regulation Management

Outsourcing and the use of cloud resources create global teams, making compliance management more difficult. It’s important to understand what regulations govern a process—in some cases, the laws of multiple states or countries could come into play. When outsourcing work in an industry with heavy domestic regulation—such as healthcare—companies must do their homework to ensure the outsourcing process will not cause problems with contracts, compliance regulations, or business relationships.

Comprehensive training is paramount to manage compliance across multiple organizations and locations. Before any employee, contractor, or outsourcing rep is allowed to access your network via the cloud, require that they participate in compliance training and pass a test that ensures a basic understanding of major regulations, security protocols, and confidentiality of sensitive information.

Using Cloud Resources to Enhance Outsourcing Compliance

You can use cloud resources to boost outsourcing compliance. Training sessions can be conducted over online portals. Web conferences can be used to enhance communication during meetings, and online imaging systems allow everyone to view the same documents on a secure server. Cloud workflow management tools can be customized to route work—advanced systems allow validation to be built into workflow, reducing the number of times each items must be reviewed manually. Admin tools allow the corporate or home office to access to audit information access and limit access where necessary.

It’s important to remember that you can’t outsource your compliance responsibilities. A mistake on the part of an outsource or cloud vendor is going to be treated as a mistake on the part of your company, so make sure you take precautions and communicate expectations with any outside resource.

Hassan Sultan is a partner at Reckenen, which provides compliance and assurance services to privately held companies

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FindMyHost Editor

The 'Web Hosting Blog' at FindMyHost.com was established to provide the web hosting industry with the very latest in news, technology, interviews, event information and more. About FindMyHost.com: Launched in January 2001 to protect Web Host Consumers and Web Developers from making the wrong choice when choosing a Web host. FindMyHost.com showcases a selection of web hosting companies who have undergone our Approved Host program testing and provides reviews from customers.

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