For FP&A, the cloud appears to have finally reached the tipping point. More and more organisations are realising the transformative potential of the cloud to enhance budgeting and planning, while also driving better business results.
Although finance is one of the last departments in the enterprise to go cloud, the shift is on, according to Gartner, who disclosed they are no longer covering non-cloud solutions in their latest report. In fact, companies like SAP aren’t even included in the report, as they didn’t make the move to cloud fast enough.
And CFOs agree. According to a recent CFO Survey, finance leaders expect technologies to increasingly reside in the cloud. CFOs estimate that 33% of their IT infrastructure is software as a service today, and they forecast this to grow to 60% of their infrastructure in four years.
The bottom line: With a few exceptions, the key question facing CFOs and FP&A leaders is fast becoming not if you are moving to the cloud, but when you are doing it.
Yet committing to a cloud transition is only the first step. It’s essential to take key actions to help ensure a smooth transition and position your team and the broader organisation to reap the full benefits that a cloud solution can offer. Here are three smart moves that provide the foundation for success.
Assess your current state: The legwork you do leading up to your migration can go a long way toward ensuring a smoother, more productive future in the cloud. Think of the old mantra: “It’s hard to know where you are going if you don’t know where you’ve been.”
Obviously, the key to your pre-migration assessment is to identify the systems, technology, and processes currently being used to manage and analyse financial and operations data at your organisation. It’s also important to get a clear snapshot of the data itself. Where is it being housed? Is data siloed? Is there general agreement on what is the core data for your organisation?
This assessment will help create a benchmark from which to measure your progress, while also ensuring the cloud system you deploy has the functionality, capacity, and capabilities to deliver the most value.
Further, a detailed assessment of your current state has additional benefits. For instance, it should provide reassurance to your executive sponsor and the leadership team that the necessary research has been done and the potential benefits clearly identified. The assessment also helps identify processes or technology that are currently delivering value and might have a place in the post-cloud environment.
Educate and inform: Those already well-versed in cloud know its many benefits. For FP&A, the cloud frees teams from the drudgery of static planning and enables the fast, easy, and powerful capabilities of active planning. Yet even the best technology and most seamless deployment cannot be successful if you don’t get buy-in from everyone from the executives to the admins. In short, to be successful you need more than just a cloud transition strategy for the technical and logistical aspects of moving from an Excel environment or a legacy system to the cloud. You also need a cloud migration strategy to effectively communicate the benefits, and you need to provide adequate training to get partners from throughout the organisation understanding and leveraging the cloud technology.
It’s human nature for people to focus on “what’s in it for me” when faced with change. Yet once business partners grasp that a cloud platform can provide on-demand, self-service access to customisable dashboards, then you have a much easier sell. Ultimately, moving to the cloud should be positioned as not just an FP&A project, but rather an advancement that offers benefits to the whole organisation through more efficiency, better collaboration, and stronger business results.
Don’t declare victory early: If you accurately assess your current state and have effectively communicated the benefits of the cloud, you should move through the first phase of your transition with real momentum. From there, the key is to sustain it. It’s important to continue to promote the benefits of the cloud as an opportunity to adopt active planning that can enhance efficiency and create a competitive edge. For instance, once a cloud platform is established you can move toward a single source of truth—one set of data for the entire company. You can also leverage forecasting and modeling capabilities that offer value to business partners by providing insight on everything from managing headcount to more effectively tracking sales and inventory.
Taking your time and phasing your transition in ways that continuously build on the foundational benefits of the cloud will build an army of advocates, while also positioning FP&A as collaborative strategic partners as opposed to order takers and number crunchers. By making it clear from the start that a full cloud transition takes time and is most successful when executed in a phased approach, you buy yourself time to ensure that the migration is successful and offers the best opportunity for strong ROI.
Ultimately, by taking a well-planned, strategic approach, you can dramatically improve the chances that your transition to the cloud goes smoothly and delivers the maximum value to your business.