Historically, smaller companies have driven the success of financials in the Cloud, but there is a clear trend emerging that shows larger organisations are turning to Cloud applications in a bid to become more agile and responsive to market changes, re-organisations and acquisitions.
Within larger companies the argument is becoming less about cost and more about speed and agility. Our own organisation is a perfect case in point: we employ 250 staff but we don’t have one piece of IT infrastructure behind a firewall and this won’t change even when we are employing 1000 staff. It is this level of agility that provides the real benefit and allows the COO to put resources into adding more value to the customer.
It’s a view supported by the most recent research compiled by IDC, the global market intelligence firm. It found that Financials and Accounting is considered by CFOs to be an important part of Cloud strategy over the next three years. Interestingly, those in companies employing between 1000 and 9999 are no different in their attitude to those employing between 50 and 99 staff. That’s because Cloud is increasingly being seen as transformational with a decrease in IT budget and a decrease in head count less important than the ability to focus on high value activities and to innovate.
Finance executives tell us that if they can find a Cloud solution that does what they want, then that’s what they are going to use. They like the fact that they can pick and choose the applications that appeal most and that it doesn’t have to be a multi-year journey. Some may like the look of a billing application and know that they don’t have to move everything in one go. If they are not quite ready to move their general ledger, that doesn’t present a problem.
There is a growing awareness that rather than being at the end of the chain, Cloud can allow finance can play a more active role whatever the size of the company. How we think about financial applications is changing and it is as much the conversation around the transactions as the transactions themselves that is now gaining in importance. The innovation lies in making that data available across the business and with the help of social applications, like Chatter, that allows each member of the team to talk to each other. We can suddenly see that business apps do not have to be different to those we use in our home life. CFOs may not be as interested in social media as some, but when they realise that Chatter saves time because there is no need to come out of the application and into the email program, they start to see the benefits.
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One of the greatest impediments to migration to the Cloud in larger organisations is their reluctance to move on from an era dominated by hardware and machine rooms. The big global vendors encourage this train of thought with a reluctance to enter the Cloud space as their business models are predicated on the old era of up-front license fees. They will have no choice but to evolve – it is only a matter of time.
The finance and accounting function continues to face challenges driven by volatile markets, complicated internal processes, and inadequate visibility. Top performing organisations are more agile; more forward thinking and more accurate than their peers and it seems that larger organisations are now starting to see that financials in the Cloud can help deliver those differentiators.
CEO and President, FinancialForce.com