This can partly be attributed to the pressure on today’s CFOs and finance leaders to play a greater strategic role. In a recent research report from specialist finance recruiter Robert Half, 66% of finance leaders asked said their finance team is either making widespread use of cloud computing technology or that it is core to what they do5. Their desire to experiment more with technology in a bid to drive strategy also means that CFOs are, in many organizations, the most experienced business leaders outside of IT when it comes to identifying and implementing new technologies.
Cloud technology is a key enabler for companies seeking to grapple with big data and analytics, thanks to its scalable compute power. This technology is one of the factors helping CFOs become catalysts for change within organizations, by helping them gather and identify actionable insight with which to influence their wider corporate strategy6.
In our survey, 47% of finance respondents agree that they will increasingly use Infrastructure as a Service (IaaS) for on-demand computing and ondemand storage in the next 12 months, higher than for HR and marketing respondents. “Since the volume of real-time transactional data is huge, it is only cloud platforms that can handle it, whether it’s coming from machines directly through sensors, or whether it’s coming from human beings on the basis of the transactions that they do on social or other platforms,” says Amitava.
But finance has other priorities for cloud too. In our survey, the top three benefits that finance leaders expect their organization to gain from cloud-based solutions in the next 12 months are: improved decision-making and automated process flow (39%); increased IT resource utilization (33%); and accessing cutting-edge technologies, such as embedded business analytics and social collaboration (32%).
Amitava argues that the finance function’s adoption of cloud is often driven by the desire to streamline backend operations, rather than significantly disrupting the business model. “The processes that are very core to the business with respect to decision-making, such as the management reporting, are still to a certain extent kept in-house, but transactional processes that can be streamlined with a lesser degree of customization, and can be aggregated to achieve economies of scale are moved to the cloud,” he says.
Three-quarters of finance leaders also reported some degree of budget increase for cloud-based investments, reflecting greater control being distributed to the finance function for technology spending. The trend of finance increasingly partnering with other areas of the business means that many CFOs have already been building stronger relationships with CIOs, and this will provide a platform for successful collaboration on new cloud projects that are launched as they put these increased budgets to work.
2. CHROs lead with the Cloud
Finance leaders are not the only ones seeking to add value in their function through utilizing cloud technology – CHROs are increasingly taking the lead on adopting virtual systems too.
An estimated 90% of Fortune 1000 companies plan to replace their human resources management software by 20177. This is clear from our survey too, where a greater proportion of HR leaders than those in finance or marketing said they plan to make greater use of Software as a Service (SaaS)-based Enterprise Resource Planning (ERP) solutions, and SaaS messaging and collaboration solutions (46% versus 43% and 29%, respectively).
Cloud solutions can deliver clear benefits in an HR context. For larger organizations, introducing global platforms can enable HR leaders to monitor employee performance across the group, helping them to better allocate resources for driving improvement. They can also help to provide real-time information about employees across the business and ensure that HR processes are updated in accordance with the latest advances and legal issues in the area.
Amitava says for larger organizations, the ability to integrate new employees more quickly and efficiently as they expand is a huge benefit. “As organizations are becoming more globalized, they want to induct new employees in remote locations as fast as in their domestic locations. It is far faster, cheaper and simpler to achieve this if your HR application is in the cloud, rather than on-premise,” he says.
The areas our HR survey respondents identified as having the greatest potential to be improved through cloud solutions were: accessing cuttingedge technologies such as embedded business analytics and social collaboration (33%); increasing productivity (30%) and a greater ability to focus on strategy and core competencies (30%). The use of cloud-enabled enterprise collaboration tools is helping firms to fundamentally reinvent how they are managing their business. It brings huge potential for enhancing knowledge transfer and the sharing of expertise, enabling employees from across organizations to be more innovative and increase productivity.
According to our survey results, the HR function has seen the largest jump in budget increases of more than 30% specifically for cloud investment, ahead of finance and marketing. This suggests that organizations are realizing the value cloud can bring for HR processes and are entrusting greater resources to HR leaders to exploit these opportunities.
Number of respondents whose cloud technology budget has increased by more than 30% in the last 12 months: