Cloud: Making the Impossible, Possible

Cloud is no longer a technology to consider – it's something CFOs are using to remain relevant and competitive. Gone are the days when leaders debated whether cloud was scalable – finance organizations both small and large are reaping the benefits. With leaders looking to modernize enterprise-wide, CFOs should be asking themselves one question: Why wouldn’t I use cloud?

As cited in Deloitte’s recent CFO guide to cloud report, with cloud, leaders can prioritize both cost-cutting and greater capabilities – something previously seen as contradictory. While CFOs look to embrace lower operating costs, they should also realize the strategic value that cloud has to offer both within the finance department, and across the Enterprise. As CFOs increasingly drive business strategy and consider cloud applications, they should first consider three key factors: innovation, necessity and cost.

Guiding Forces: Innovation, Necessity, Cost 

We are in an era of unprecedented speed of change. As the business landscape continually shifts, cloud can provide organizations the crucial ability to become nimble and adapt in real-time. Data is increasingly serving as the unifying force for business. With cloud, data becomes transparent and immediate, feedback loops shorten from months to minutes, analysis improves, and leaders can course-correct constantly. This is beneficial for essential tasks like financial reporting, and the same can be said for other departments, ranging from product teams, supply chain to sales and marketing, and more.

With cloud, innovation is at the fingertips of organizations looking to scale and succeed. For example, business leaders can manage demand shifts seamlessly – something they previously couldn’t even conceive of. Cloud can drastically reduce time-to-market, enabling companies to launch new products and services quickly, and at scale. Business leaders no longer need to fret about fluctuations in demand, as the scalability of cloud again provides the opportunity to effect change in real-time. In addition to business value for finance itself, cloud allows leaders today to see new ways finance can add value to an organization beyond processing an invoice or cutting a check. Today, companies can use cloud as the foundation and accelerator for data solutions, advanced analytics, machine learning, and more, to create a culture of continuous improvement.

Beyond cloud’s numerous benefits lies the necessity to adapt. Today, ERP providers are shifting both investment and attention towards cloud. In fact, it can be anticipated that these vendors will only continue to support on-premises technology for a few more years. This could leave CFOs with an ultimatum: embrace cloud or be left behind. More than nine out of ten respondents in Deloitte’s 2018 Global Outsourcing Survey said their organizations are adopting or considering the cloud. Those who are not should consider exploring the technology soon or potentially become stuck with legacy systems that have a clear expiration date.

Cloud is often extremely cost-efficient. While adoption can appear expensive at first, CFOs can recoup their investment and eventually see decreased operational costs. In fact, some companies are achieving returns of more than ten times their original investments when accounting for all costs and benefits – including innovation, a value-add that must not go unnoticed.

Whatever the primary driver of cloud adoption, be it innovation, necessity or cost, CFOs must take time to understand all that cloud has to offer. This is increasingly true as major providers continue to build new capabilities alongside their cloud products, ranging from data solutions to advanced analytics to machine learning. CFOs without a comprehensive understanding of the landscape will likely miss out on opportunities for the finance function and the organization at large.

Next Steps with the Cloud

Maybe a CFO has already decided to adopt cloud. Now what?

First, it is crucial CFOs consider which departments, in addition to finance, could stand to benefit from cloud. With a 360-degree view of the organization, the CFO must become acutely aware of core opportunities across varying areas of the business and ensure they are prepared for, and benefitting from, widespread cloud adoption. These programs cannot operate in silos. Effective cloud use requires seamless integration, spearheaded by the CFO alongside other C-level leaders.

Also built into a successful strategy is the proper mindset. Cloud implementation is as much about the operating model, training and experiences of employees as it is about the actual technology. It’s crucial leaders prepare their workforce for the significant shifts that cloud technology brings – or they could face a bumpy road ahead. Employees must be equipped with the skillsets, and the mindset, that cloud technology requires. Assessing existing skillsets and emerging talent needs prior to cloud adoption can help achieve the expected results.

Twenty years ago, finance was leading the way in technology adoption. CFOs today should look at cloud holistically and find a way to better drive innovation and investment, taking note of the preparations and processes needed. From usage to investment to implementation, there are many considerations CFOs must make when transitioning to cloud – yet, when looking to both the present and the future, it’s clear the journey to cloud is worth it.

Matt Schwenderman is Principal, Emerging ERP Solution at Deloitte Consulting LLP.