We could tell you all of the benefits of moving to the cloud in strict monetary value. Moving from capital expenditures and an iceberg shaped cost structure to a transparent subscription model, pointing out the cost of staff that it takes to run on-premise software, and the complexities that come from upgrading or integrating.
Correcting the Myth: Real Focuses for Companies Considering Cloud
It’s actually one of the biggest myths, that money is the only reason that a company would move to cloud accounting. Yes, it’s an important factor. But when a company focuses too much on money as opposed to value, it “is likely to net you more heartache than cost break,” said Gartner Managing Vice President and Fellow Daryl Plummer in a 2012 Forbes article.
That was 2012. Now that companies of all sizes, industries, and traditions are considering the cloud for a variety of purposes, it’s worth noting that executives may still be focusing too much on the money issue.
CIO Insight in a recent article pointed out considerations when gauging the value of the cloud.
- It’s More Than Just Numbers: Cloud capabilities can change your business model and enable new features and capabilities. However, when poorly implemented, it can create risks, limit efficiencies, and cost you more than you had hoped to spend. By finding something that can align with your business model, you can prime your organization for success.
- Focus on the Process: It’s nice to have the shiny new technology, but how does it help your business? Do your employees know how it works? What you really need to focus on is whether or not it actually makes your business more efficient by breaking down silos, making the lives of end users and managers easier, and actually improving your processes.
- Cloud vs Cloud: Not all clouds are created equal. Just as you need to focus on how moving to the cloud eases your business processes, you need to know how the cloud product you choose stacks up to other cloud products.
- Choose the Right Vendor and the Right Partner: With millions of cloud products ranging from plugins to complete offerings, it’s important to find a vendor that caters to your business, industry, and size. It’s also important to find an implementation partner (sometimes the vendor itself) that can support and will support you through sales, implementation, training, and ongoing support.
Thinking Beyond Dollars and Cents
So what should you measure? There has to be some form of measurement, right? How about any of these?
- Ability to Upsize and Downsize as Needed (Scalability)
- Reduced Stress on IT Staff
- Greater research and development (R&D) spend efficiency
- More frequent functional improvements to the product
- Lower support costs for the vendor and the customer
- Lower cost testing and debugging environment for the vendor and customer
If You Still Need Monetary Reasoning…
Vital Analysis, a venture of TechVentive, recently released a whitepaper titled the Economics of Cloud Financial Software.
Economics of Cloud Financial Software will help you:
- Understand, define, and explain the various flavors of cloud
- Quantify the upfront and hidden costs of on-premises, hosted, and SaaS deployment methods
- Discover the business and technical advantages of multi-tenant solutions
- Identify the critical factors you should know when selecting a cloud vendors
Download the Economics of Cloud Financial Software on Intacct’s Website