They came for the cost reduction. They stayed for the innovation.
That’s the key finding of a recent Oracle survey looking at trends in ERP (enterprise resource planning) and EPM (enterprise performance management). In a survey of more than 400 finance and IT leaders, 79 percent of respondents said they have either moved their finance applications to the cloud, or plan to do so over the next two years.
The reasons behind the move are primarily economic—including the desire to avoid infrastructure investments (45%) and on-premises upgrades (33%), as well as lower TCO (38%). A strong majority of respondents (63%) achieved the economic benefits they initially set out to attain.
But something surprising emerged from the survey results. When asked about the top benefits of ERP in the cloud, an overwhelming 85% of respondents cited, “Staying current on technology”—far outpacing any of the other advantages cited.
The ability to keep up with the unprecedented pace of business change—implementing the latest best practices and innovations on a regular basis—is an entirely new phenomenon. In this model, new capabilities are rolled out to the finance function several times a year (similarly to IOS updates with a mixture of compulsory and optional enhancements).
In the traditional world of on-premises systems, it is unthinkable to update ERP at such a breakneck pace. Years often pass between upgrades—and with every passing year, the risk of the business falling behind competitors grows, as well as the risk of exposure to security breaches.
With cloud, the risk of technology obsolescence drops to zero—putting the business on a more solidly competitive footing. The move to finance cloud applications is the last upgrade you will ever do.
And the capabilities available in the cloud today can immediately add more value to the finance function. When asked what they could do in the cloud that they could not do with their on-premises applications, the responses included:
The cloud is also the primary delivery mechanism for new and emerging technologies: blockchain, artificial intelligence, machine learning, cognitive computing, intelligent process automation, and the Internet of Things (IoT). Finance professionals are exhibiting a keen interest in these technologies. Roughly 4 out of 10 are already exploring these areas—in keeping with their desire for innovation and new capabilities.
Many of these emerging technologies fall squarely into the charter of the finance function. For example, blockchain has a number of use cases that could impact finance and the supply chain, while AI and machine learning can detect patterns in huge data sets that a human being could never uncover, potentially reducing and even correcting for material risks.
These technologies have the potential to automate routine transaction processing, eliminate manual tasks, and reduce the likelihood of errors. Such automation will free up finance professionals to spend more time providing forward-looking guidance, uncovering and recommending new opportunities to senior management.
With the benefits clearer than ever, finance in the cloud has become the new standard for the office of finance. The discussion is no longer about when to make the move. It’s now.
As the pace of business change accelerates, finance leaders recognize that the technology of the past won’t help them keep up with the competition. Moving to the cloud is an opportunity for companies to re-invent and transform their business processes. With the regular cadence of innovation delivered by the cloud, and zero risk of technology obsolescence, finance leaders will be well positioned to help build the business of tomorrow, today.