Why Migrating Your Finance and Accounting to the Cloud is Great for Business
by Michael Burdick, on Dec 27, 2018
As decision makers in the business world, we're bombarded with the newest trends in technology. It's not easy deciding what is worth adopting, and what is just a passing fad. For our finance and accounting teams, the decision is especially delicate.
In recent years, cloud-based software and storage has become a necessary technology for finance and accounting teams. A 2017 survey found that 51% of businesses have moved to the cloud for their finances, with another 21% planning to move soon, a steady increase from previous years. The undeniable benefits of this recent migration are hard to ignore.
Where You're Wasting Money
Think about everything that your finance and accounting departments have on their plate. Depending on your business, they may be handling sensitive customer information, managing payroll, managing taxes, paying bills and invoices, processing payments... this amounts to a lot of data to store and protect.
Healthcare companies spend 75% of their IT budget on maintenance alone, if they're using in-house software and hardware. It makes sense–internal operations need to be backed up and updated regularly. All of these steps take time, resources, money, and workers. Is there any time and money left for things like development and innovation?
How the Cloud Will Help You Save
Cloud-based accounting software often costs an average of $20 less per month per user than on-premises software. I know that sounds impossible, but think about what cloud-based storage and software is. It's as if you and a bunch of companies got together to pool resources on one giant, state-of-the-art storage facility. Things are always cheaper in bulk.
Unlike financing your own storage from scratch, with the cloud, you pay a monthly fee for exactly what you use. Cloud-based service providers usually offer a generous free trial period, on top of that. Moreover, it lowers your in-house electricity costs. These efficiencies enable you to concentrate that surplus money on the growth of your company.
The transition to the cloud can seem daunting, but the ROI is well worth the upfront cost of hiring a financial company to help you make the transition. An expert that can seamlessly move your files, keeping everything organized and compatible with your new software, so your move to the cloud can be affordable, quick, and painless. Then, you can invest that extra time and money straight into your bottom line.
Your Security Concerns
The news is full of nightmarish stories of leaked customer information, or essential services getting hacked. It's a major concern, especially for targets like finance and accounting.
The concern most business owners have about moving to the cloud is its association with the internet. Understandable–the internet feels like a public space, where anything can happen. But cloud-based services are actually more adept at meeting your security needs than anything your in-house team can handle. It's crucial to their survival, and at the forefront of their design.
As more business owners become privy to this, their trust has been gradually increasing. Skepticism about cloud security declined from 29% to 25% from 2016 to 2017.
You're internal servers are prone to hacks, surges, natural disasters... You can't continue normal operations, and be the world's foremost expert on the newest security technology all at once. This is one case where outsourcing is simply wiser.
ROI and Scalability
As your business is going through its ups and down, your storage and software needs are always changing, and your team is inevitably one step behind the curve. When you have a surplus, you're underutilizing your resources. When you don't have enough, you lose money playing catch up. This wasted opportunity cost presents one of the major advantages of moving to the cloud.
Cloud storage and services are pay-for-what-you-need, and infinitely scalable. You can scale down just as quickly as you need to scale up, whenever you need to.
The Open Group ran a comprehensive study of the ROI effects of cloud computing for business.
One business needed to scale up their storage and were analyzing their options. They could either scale up their current in-house infrastructure, or move to the cloud.
After running the numbers, they estimated a 26% ROI over three years if they updated their current in-house infrastructure. Then, they calculated the ROI of moving to the cloud. They included the severance pay of IT workers, all software migration costs, and all legal and contract costs associated with the transition. Even with those expenses factored in, they predicted an ROI increase of 124% over three years by moving to the cloud.
The Perks of Cloud Software
The benefits of moving your finance and accounting to the cloud isn't just about replacing maintenance costs. The integration of SaaS, or Software as a Service, also presents a huge advantage, and has become dominant in recent years. But don't take my word for it. Note the minimal 6.5% of cloud supply chain software users that reported dissatisfaction in 2017.
Surveys show that users move to cloud-based software for "cost, innovation, and agility" with a 44% majority citing "overall cost reduction" as the main benefit. Many of the most recent innovations in financial software are automatically integrated with cloud storage. These services can track receipts, invoices, payments, follow-ups, bank deposits, etc... And automatically backup, save, and file everything, freeing up your employees to focus on innovation and growth, rather than mindless operations.
If you're currently using in-house spreadsheet software, or even pen and paper, multiple versions of the same thing are being saved and sent back and forth over email, added to stacks of paper. This system can turn into a real mess. With cloud software, employees can view and edit a single spreadsheet at the same time, saving different versions only when necessary.
Cloud software also allows easy access from anywhere with an internet connection, and can be accessed for free by anyone. This also frees up employees to check in remotely or even globally, from any device.
Cloud hosting also happens to be faster and more efficient than in-house capabilities typically are. In a 2014 survey, 88% of IT professionals claimed that their cloud-based provider was the same or faster than their internal server.
The transition to the cloud can be just as fast! There are financial companies out there that are ready to help you make a switch to the cloud that is quick and painless. Be sure to choose a company that is as forward thinking as you are, with as vivid a vision of the future, and the means to help you take full advantage of tomorrow's cloud-based technology.
The global transition to the cloud has been rapid, especially for finance and accounting, and expected to be the overwhelming norm by 2020. According to Forbes, 74% of Tech Chief Financial Officers expected the cloud to have the biggest impact on business in 2017.
In-house servers and on-premises software are going the way of the dinosaur. Don't let your business disappear with them. Your next big opportunity awaits, and your limited capabilities are holding you back. There's no reason to get left behind, while financial experts are ready to help you make this push into the future of security, scalability, and collaboration. It's time to reach out for help, and take this next big step toward the future success of your company.