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6 Things to Consider before Making the Move to Cloud Accounting

6 Things to Consider before Making the Move to Cloud Accounting

Cloud Accounting BasicsConsidering the cloud? If you’re like so many other business owners, financial professionals, or decision makers, you’ve at lease taken a look at why the cloud is right for your business. But when it comes to cloud accounting, financial management or enterprise resource planning, there are a few other things you should consider before making the move.

1. Cloud vs. “Cloud”

Is your cloud really cloud? Understandable, it sounds like a Yogi Berra quote, but will the software be accessible anytime, anywhere? Will you still be paying for customization, upgrade, integration, support and service, and hosting costs?

What we’re really asking is whether or not you’re paying for on-premise software, just on someone else’s premises.

One of the key benefits you get with a true cloud offering is accessibility without needing to use something like Citrix to access the platform away from the office. You wouldn’t want your bank to require you to purchase a third-party platform in order to use your online banking, why would you want the same from your financial management platform?

See More: A Brief Overview of Cloud Enterprise Resource Planning

2. A Service Level Agreement that a Vendor can Stand Behind

According to CDW, 76% of organizations surveyed say that at least one cloud vendor failed to meet the SLA. The report, released in February, found reliability (43%) as the most important metric for cloud service providers, far ahead of cost (28%) and ability to integrate with existing infrastructure (27%), meaning a double whammy for providers who couldn’t meet their uptime figures.

These are some shocking numbers, especially as failure to meet promises means that your business loses money.

The SLA is a legal promise of performance, availability and rights, yours and theirs, and should never be taken lightly. That’s why in your SLA, you should not only have guarantees, but paths of recourse if the vendor fails to meet the promises.

Deep-Dive: What to look for in an SLA from Datamation

3. Uptime: Promises vs. Proven Record

A 2011 study by CA Technologies tried to provide an idea of what downtime costs businesses on a broad scale. This survey found that a total of $26.5 Billion USD is lost each year due to IT downtime. That’s an average of about $55,000 in lost revenue for smaller enterprises, $91,000 for midsize organizations, and a whopping $1 million+ for large companies.

At the study’s number of 14 average hours of downtime per year per company, and using the above $55,000 in lost revenue for smaller enterprises, it’s fairly safe to say that an hour of downtime for this crowd equals roughly $3929 in lost revenues per hour.

Starting to see why uptime is important?

That’s why as part of the SLA (mentioned above), you should demand uptime guarantees and promises if the provider fails to meet said guarantees.

Further, you should look for a track record of under-promising and over-delivering. Something like promising money back if monthly uptime drops below 99.8% while delivering 99.993% availability over the past 12 months.

See more: Is Your Cloud Financial Management Dressed to the Nines?

4. Suite vs. Best in Class

In a recent Wall Street Journal article, Bryan Deeter of Bessemer Venture Partners shared the rise of best-in-class and why it matters.

Never before has the case for best of breed applications been more compelling. Cloud computing has made it financially and operationally viable for a company to pick the world’s best application for every need, every user, and every business case.  Companies no longer have to sacrifice functionality for the sake of integration. You can have your cake and eat it too.

Not only are you able to build your own suite with applications you already use, but these applications focus on integration and constant improvement—meaning you get more improvements each year (case in point: Intacct’s quarterly updates vs. Netsuite’s 2 releases per year).

See More: A Business Case for Multi-Vendor Technology Investment

5. Where Do You See Yourself Five Years from Now?

Sounds like an interview question, no? Of course, we’re talking about where your business will be in five years. Will you open additional locations? Will you be operating in multiple currencies? Will you even be kicking the tires on taking your company public?

These are all valid questions on which you should focus. Don’t take the time to decide, implement, and operate your software, only to find out that it’s not built for your business’s next steps.

See More: Overcoming Multi-Entity/Multi-National Financial Management Challenges

See More: Is Your Company Ready or Its IPO? What Would it Take?

6. Vendor Maturity

One of the huge considerations in the cloud is, “How long has my vendor been there?” Read a few 10-K’s and you’ll find that companies that were entrenched in providing on-premise offerings are scrambling desperately to offer a cloud product. The statement following it ususally mentions something like “Defects, delays or interruptions in our SaaS and hosting services could diminish demand for these services and subject us to substantial liability (Blackbaud 10-K).”

When a company scrambles to the cloud, it’s like the new kid in school. Has to learn what could go wrong while building a name for itself.

Companies born in the cloud, however, have seen it all, and prepared for what could happen in addition to knowing what already has. This is why finding a mature cloud financial management software is pivotal. What’s mature in cloud accounting? 16+ years of constant improvement since launch.

Been there, done that. That’s what makes Intacct such a viable software option for companies considering the cloud, and what allows them to provide such a powerful offering for companies of all sizes.

Learn more about Intacct Cloud Financial Management, and how it can help your business gain visibility, save time, and operate more efficiently by reading through the related resources:

Are you ready to make the move? Contact Brittenford Systems today.

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