To what extent is cloud computing changing traditional IT in small and medium-sized enterprises, and what challenges and opportunities does it create?

Zhengshangfeng Zhan

doi:10.54254/3049-5768/2026.32740

Abstract

This study explores how cloud computing influences operational efficiency and cost performance in Small and Medium-sized Enterprises (SMEs) compared to traditional IT systems. Under the digital transformation, SMEs face increasing pressure to improve flexibility and efficiency, reduce costs, and respond quickly to market changes. Though revisit academic journals, industry reports, and case studies from 2013 to 2025 in a systematic way. According to the research, cloud computing can significantly lower investments during the early stage and costs of continuous maintenance while promoting scalability, operational agility, and collaboration. It also shows improved data analysis, product development, and market responsiveness. Case studies about Marais USA and SMEs in Kampala show that the benefits of cloud adoption mainly depend on technological standard, strategic countermeasure, and regional infrastructure, with noticeable differences between developed and developing areas. However, there are still a lot of risks that need to be taken seriously. Not only data security and privacy remain major points, but system reliability and cross-platform interoperability also cause technical risks and skills gaps and financial investment also limit SMEs' ability to fully utilize cloud technologies. Although emerging approaches such as edge-cloud computing paradigm, multi-cloud strategies, and green generative AI show opportunities to enhance efficiency, resilience, and sustainability, but still require careful implementation and adequate technical capacity. Ultimately, cloud computing can provide substantial benefits to SMEs in cost reduction and flexibility of operations. The proof is that cloud computing is more significant to enhance the operation of SMEs than the traditional IT system although there are differences on its impact based on enterprise size, region and digitally degree. SMEs must take a strategic and professional view of the use of cloud computing potential realization if they are to play to their full, with the support of policy and technological progress.

Keywords: cloud computing , SMEs , operational efficiency , cost performance , digital transformation

Article Information

Received: 19 March 2026

Published: 14 April 2026

DOI: https://doi.org/10.54254/3049-5768/2026.32740

Article Type: Research Article

Cite this article

Zhan,Z. (2026). To what extent is cloud computing changing traditional IT in small and medium-sized enterprises, and what challenges and opportunities does it create?. Journal of Fintech and Business Analysis,3(2),1-14.

Data availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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About this Journal

Journal: Journal of Fintech and Business Analysis

Volume: Vol.3, Issue 2

ISSN: 3049-5768 (Print) / 3049-5776 (Online)

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