David Fionda, CPA
It seems like everywhere you turn cloud computing is being discussed. What is cloud computing and how can it benefit your finance department and organization?
For finance professionals, the most relevant type of cloud computing is Software as a Service (SaaS). SaaS is defined as a solution that includes turnkey infrastructure, software, maintenance and updates and support that is licensed on a per-user, per-month basis. With the SaaS business applications market expecting to reach $32 billion this year, cloud accounting is quickly becoming the new norm for many organizations.
Despite the rising popularity of cloud computing, organizations seem to be reluctant to move their financial information to the cloud. The reason most often given for not making the switch is security of their data. When their finance systems are installed in their office, they feel more comfortable that they can physically see the server that their data resides on.
Are Your Financials Really Safer With an On-Premise System?
Despite feeling safer with an on-premise financial system—there are still significant risks that you’re exposed to every day. If your finance system is installed “on premise,” ask yourself these questions:
- When was the last time the data was backed up?
- When was the last time that the backup integrity was tested? If you were to have a catastrophic failure, would your backup restore successfully?
- What happens if you were to have some weather related event, such as a flood? Is your backup stored offsite in a secure facility?
- How are you protecting your data from malware, ransomware and other viruses? If any one person on your company’s network clicks on the wrong email attachment, it could compromise all of your accounting data.
How Do Cloud Vendors Keep Your Information Safe?
For cloud financial vendors, protecting your data is absolutely critical to their business. If they were to suffer any kind of data intrusion or loss, they would no longer have a business. How do they make sure your data is safe and secure?
- They spend millions of dollars protecting and backing up your data.
- They use redundant, parallel data centers so that even if one were completely destroyed, your data is still safe.
- They employ “white hat” hackers to try to break their intrusion and security protocols.
- Their data is completely isolated from email threats.
- They employ armed guards, biometric security and intrusion detection to make sure no unauthorized persons can physically access your data.
How Your Organization Can Benefit from the Cloud
If you’re considering switching your financials to the cloud, you will see these six critical benefits.
- Better Cash Flow – You no longer have to make large, up front capital investments in expensive servers, database licenses, infrastructure and implementation. Those costs are shifted to the cloud vendor and you simply pay for what you use on a per-user, per-month basis.
- Improved Access – If you’re an organization with multiple locations or have a remote workforce, you will need to make even more capital investments to facilitate access to your data. Cloud accounting includes the ability to access the software anytime, anywhere, on any device (PC, Mac, Tablet, Phone) in the monthly subscription.
- Greater Scalability – As your company grows, you bear the responsibility to manage and increase infrastructure capacity and performance with an on-premise situation. Rather than worrying about increasing your capacity, cloud accounting grows with you. Simply purchase a subscription for those new users and pay for nothing else.
- Faster Deployment – Since cloud-based financials don’t have to be installed and configured, they require less effort to implement in comparison to traditional premise-based financials.
- No Maintenance/Update Costs – Your cloud accounting subscription includes the seamless installation of upgrades and enhancements. You no longer have to pay maintenance and professional fees to maintain your accounting system.
- Cost Savings – Cloud financials cost less than on-premise solutions in the long run. You can click here to download an actual analysis we did for a client in response to a request to compare the annual costs of upgrading their solution that was in place at the time.
Looking to implement cloud computing for your financial solutions? Contact BlumShapiro Consulting to discuss the variety of software solutions available, a complimentary assessment of your current finance system and next steps towards implementing this solution.