Boston–Senior finance executives at U.S. companies believe cloud computing will have significant implications for their company’s success in the coming years, according to the new study by CFO Research, sponsored by Google. The full report on this study, titled The Business Value of Cloud Computing, is available for download at www.cfo.com/research.
Three-quarters of respondents to the CFO Research survey (76 percent) agree that a solid cloud computing strategy will be important for their company’s success within the next 12 to 18 months. While not every company plans to adopt cloud computing in the near future, those companies that have adopted cloud computing report positive results. A majority of finance executives say that their company’s largest cloud computing project resulted in cost reductions that aligned with their expectations for hardware-related costs (71 percent say savings met or exceeded expectations), costs related to system backup and data recovery (66 percent), software-related costs (66 percent), and IT labor costs (59 percent). (See Figure 1.) And respondents see more savings ahead: nearly two-thirds (64 percent) say that a complete implementation of cloud technology would reduce their company’s operational costs by up to 20 percent. An additional 15 percent anticipate even greater savings.
Finance executives are similarly impressed by the cloud’s ability to improve the performance of the IT department. Finance executives see major IT benefits from moving to cloud-based systems: two-thirds of respondents (67 percent) say that the cloud would improve their IT department’s capacity to innovate, and a similar proportion (68 percent) say that it would enable IT to focus on activities that add value to the business, such as contributing to corporate strategy setting. (See Figure 2.) “Finance executives see the cloud as means of improving IT performance,” explained Matt Surka, Research Editor at CFO Research. “The cloud certainly offers cost savings, but finance executives are most interested in using the cloud to redirect IT resources to high-value activities?not strip resources out of IT.”
Senior finance executives express similar views on a variety of other benefits of the cloud, including the cloud’s capacity to increase productivity for all employees. Eighty-one percent of respondents say that a complete implementation of cloud-based systems would improve employee productivity throughout the company. Thirty percent of respondents at companies with cloud-based systems say that the cloud exceeded their expectations for improving employee mobility, in addition to 47 percent who say that their expectations for greater employee mobility were met. Only nine percent say that the cloud fell short of expectations in this respect.
When making IT purchasing decisions today, a significant proportion of finance executives say their companies view cloud technology as a serious option. Half of respondents (52 percent) are currently including cloud-based systems in their IT decision-making processes: 40 percent say that their companies consistently include cloud-based options alongside on-premises options when evaluating new systems, and 12 percent already prefer cloud-based systems over traditional on-site servers.
As with any new technology implementation, senior finance executives see challenges ahead. They most frequently cite data security concerns (68 percent) as the greatest barrier to adopting cloud computing at their company, but many respondents point out that these concerns can be addressed through due diligence and proper relationship governance.
This study is based on 310 electronic survey responses from senior finance executives working at U.S.-based companies. Survey respondents work for companies in a broad range of company segments.
About CFO Research:
CFO Research is the sponsored research group of CFO Publishing LLC. CFO Publishing LLC, a portfolio company of Seguin Partners, is the leading business-to-business media brand focused on the information needs of senior finance executives. The business consists of CFO magazine, CFO.com, CFO Research, and CFO Conferences. CFO Publishing’s award-winning editorial content and loyal, influential audience make it a valued resource for its readers as well as an effective marketing partner for a wide range of blue-chip companies. CFO Publishing has long-standing relationships with more than 500,000 finance executives.
Google Inc. conducted this research with CFO.com. To learn more please visit www.google.com/apps/cfo.
CFO Publishing LLC