What CFOs Need to Know: Moving to Cloud Isn’t a Financial Decision or a Technical Decision. It’s a Business Decision.

 In Cloud, IT Planning

Cloud computing is no longer a novelty. Some surveys show that 95% of businesses use the cloud in some format. For many companies, that may mean just some unofficial, “shadow IT” usage of cloud storage to make sharing files easier. For companies that make a deliberate decision to migrate IT resources to the cloud, it can mean using private cloud, public cloud, or a blended hybrid cloud environment.

Whichever form your company’s cloud computing takes—whether it even uses cloud at all—should result from a sound analysis of the impact of cloud computing on your business to assess whether you’ll achieve the promised benefits of cloud. You need to consider cost factors, technical factors, and, ultimately, business factors.

Financial Considerations in Moving to Cloud Computing

Many of the promised benefits of cloud computing are financial. Because cloud computing is flexible and scalable, you can spend only on the capacity you need now, rather than purchasing spare capacity in advance. You also reduce your ongoing support and maintenance costs, since much of that responsibility shifts to the cloud provider.

The costs that remain become operating expenditures rather than capital expenditures; this can simplify your budgeting process, smooth your cash flows, and help free up funds for other investments. However, you need to crunch the numbers to make sure the promises the vendor makes and the examples they use are relevant to your specific situation.

Technical Considerations in Moving to Cloud Computing

Although cloud computing moves many IT support responsibilities to the cloud provider, your cloud environment still requires oversight by an IT team responsible to your business. It’s possible your team may not have the skills to support the cloud environment; you may need to rely on a managed cloud services provider to oversee the functioning of your cloud provider.

You also need to review the impact of the cloud on your applications and data. Some applications may have hardcoded dependencies on a specific configuration that will keep them from running in the cloud. The security of your data in the cloud also needs to be evaluated. In most cases, the early concerns that cloud environments were more vulnerable than on premises data centers has been replaced by the realization that a cloud environment secured by a skilled, dedicated team is as safe as or safer than local storage.

Business Considerations in Moving to Cloud Computing

The most important consideration you should think about when adopting cloud computing is how it can affect your business. Cloud isn’t just a computing model; it’s a business model. Using the cloud effectively can help your business be more flexible and responsive to changes in your business environment.

Your IT team is freed up from day to day maintenance and can focus on supporting your business rather than supporting your hardware. Because you only pay for environments when you use them, and new environments can be created on demand, the cloud can allow you to test out innovative ideas and applications without a major investment in new hardware. Ideas that work out can scale up to wide usage; ideas which fail can simply be shut down.

Deciding to Move to Cloud Computing

Making the decision to move to cloud computing should be a strategic decision. If you’d like to get more insight into how the cloud can help your business cope with its information technology challenges, contact Prescient Solutions. With expertise in managed services, cloud services, and the other technologies your business depends on, we can offer advice on the best technical direction and help you take it.

Additional Resources

The CFO Guide to Hiring an IT Consulting Firm

Be a Tech-Savvy CFO to Make Smart Tech Funding Decisions

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