Inside corporates, the cloud is on a roll, particularly post pandemic. CFOs and finance teams should be next to jump on board. But confusion about pricing, benefits, and how to make the transition from on-premise systems is holding many back.
Regardless of company size, CFOs are always looking to reduce costs and improve the bottom line. Now more than ever an increasing number are seeing the cloud’s potential as a money saver – as well as a way to make their own departments more efficient and effective.
The financial benefits of the cloud
Transferring responsibility for hosting and maintaining applications over to a cloud vendor can be quite empowering. The cloud provider does all the heavy lifting in terms of management of the hosting environment, securing data, and making sure applications are available to end-users at top performance and across devices.
The cloud’s subscription-based pricing model can establish greater control over cost. Budget moves from CAPEX to OPEX. The freedom to pay only for the capacity, capabilities, and user licenses you need allows organisations to avoid the high upfront costs of on-premise solutions. In that way Cloud makes it easier to align technology expenditure with growth.
Cloud-based systems can also respond more flexibly to changing business requirements. Because they can be deployed without installing new hardware and software, cloud allows companies to support new business models, harmonise systems with new acquisitions, and more easily test new markets.
Other cloud benefits for finance:
· The finance-focused cloud is growing: more cloud solutions supporting core financial applications like ERP and EPM are entering the market and geared to organisations of all sizes.
· Excel Farewell: Cloud provides a low-risk, path to move processes away from spreadsheets
· CFOs can keep IT costs in-sync with business levels: Since cloud assets can be scaled upward and downward quickly against an agreed cost structure, IT spend can be more closely aligned to growth.
· Think security: The cost of keeping IT security up to date is significant, and the costs of a breach can be severe. The cloud initially raised safety concerns for some, but time and innovation have given cloud vendors some of the strongest security protections available in IT.
· Improved Productivity: Since the cloud makes core applications more accessible, employees can accomplish more. Rather than being bound to a single location or machine, they can access the tools they need when traveling, offsite or out of hours. Particularly important as more people are working from home
· Reduced Redundancy: Cloud environments eliminate the contingency expenditure built into on-premise systems. Any necessary redundancy is the vendor’s responsibility, and built into the data centres where infrastructure and applications are hosted.
With organisations of all sizes adopting cloud technologies at a rapid pace, it’s also worth evaluating what the competition is doing – no one wants to be left at a disadvantage.
While the benefits of the cloud seem to be transparent and superficially require just a PC and fast internet connection to use, migrating data and processes from traditional IT to SaaS can be complex. There is much more to it than handing over access to your databases to the cloud vendor and assuming all will be fine.
Integrating systems and creating new processes can be a lot of work. Significant planning is required in order to achieve data portability and interoperability with the cloud. The stages of migration and deployment can be costly and resource-heavy if not handled correctly.
CFOs should consider working with an experienced implementation partner who can help answer the following questions:
· How much time and expense will we need to invest in evaluating cloud vendors?
· How can we make the implementation work for finance requirements, time cycles and processes?
· How much can we save by purchasing licenses as needed rather than having to project our needs up front?
· Will we need entirely new processes or can we migrate those as well?
· Looking beyond costs savings, where can cloud software give us a strategic advantage?
The advantages of cloud computing should give today’s CFOs lots to think about. The benefits are compelling, but at the outset at least, making the move alone is unwise. Consider working with an expert who can help you design an approach to cloud computing tailored to your organisation’s particular needs and business objectives.