Next Generation Finance System Technology for On-Premise and Cloud Data Storage Solutions

SPECIAL REPORT

Next Generation Finance System Technology for On-Premise and Cloud Data Storage Solutions The Next Generation of Finance System Technology Thriving in the Digital Age Choosing the Best Systems The Age of Big Data The Future is in the Clouds

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Published by Global Business Media

SPECIAL REPORT

Next Generation Finance System Technology for On-Premise and Cloud Data Storage Solutions The Next Generation of Finance System Technology Thriving in the Digital Age

NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

Contents

Choosing the Best Systems The Age of Big Data The Future is in the Clouds

Foreword 2 Tom Cropper, Editor

The Next Generation of Finance System Technology

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Nicky Wilkins, bluQube

Consequences The Cloud

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Published by Global Business Media

How Did We Get Here?

Cloud versus On-Premise

Published by Global Business Media

Choosing a Supplier

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Case Study: Balfour Beatty

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Interoperability Devolved Financial Software Take Advice from the Experts

Thriving in the Digital Age

Publisher Kevin Bell

Tom Cropper, Editor

Editor Tom Cropper

Success or Failure

Business Development Director Marie-Anne Brooks

Competition and Innovation Cost versus Reward

Senior Project Manager Steve Banks

Choosing the Best Systems

Advertising Executives Michael McCarthy Abigail Coombes

Jo Roth, Staff Writer

Production Manager Paul Davies

About the Provider

For further information visit: www.globalbusinessmedia.org The opinions and views expressed in the editorial content in this publication are those of the authors alone and do not necessarily represent the views of any organisation with which they may be associated.

Material in advertisements and promotional features may be considered to represent the views of the advertisers and promoters. The views and opinions expressed in this publication do not necessarily express the views of the Publishers or the Editor. While every care has been taken in the preparation of this publication, neither the Publishers nor the Editor are responsible for such opinions and views or for any inaccuracies in the articles.

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Simple and Easy Understanding the Risks

The Age of Big Data

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James Butler, Staff Writer

Weighing Up Cost Against Performance Keeping Track Maximising Management Time

The Future is in the Clouds 13 Tom Cropper, Editor

A Tailored Solution The Battle for Small Businesses Can Legacy Systems Survive?

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NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

Foreword O

NCE IN a while a technology comes along

at how companies are adapting to life in the digital

which promises to revolutionise the way

age. Those which have been swift to embrace new

we do business. Sometimes those promises

technologies forge ahead, while others can see their

are fulfilled and sometimes not. Those adopting

business drop off alarmingly.

such technologies early take a calculated gamble;

Jo Roth then looks at the emergence of the cloud

if it’s successful, they can gain a sizable advantage

as a major force in business. With so many players in

over the competition. If not, then, they could pay

the market, making a choice can be difficult. He looks

the price.

at some of the key questions businesses should ask

We have arrived at such a stage with finance systems

themselves before making a buying decision.

technology. The market is evolving quickly with new

James Butler, then analyses the business case. Any

technology becoming available – particularly in the

business deciding to adopt the cloud will need to see

form of cloud applications. Much has been written

a clear and convincing business case. He examines

about the transformative potential of the cloud, but,

some of the most commonly given reasons given for

in terms of market penetration, there is still has a long

embracing cloud technology as well as some of the

way to go. Quality of service varies amongst providers,

most common problems.

and many managers still do not fully understand how the cloud works, or what benefits it can bring. This report is therefore an opportunity to examine the market in more depth, analyse its strengths, future direction and major trends.

Finally, we take a look at where this market is heading.

The technology is evolving rapidly and businesses are already demonstrating clear improvements. We’ll see what the market might look like in ten years’ time.

Our first article comes from bluQube, one of the leading providers of finance technology systems.

They discuss the rise of cloud finance systems and their potential for the market. We will then take a look

Tom Cropper Editor

Tom Cropper has produced articles and reports on various aspects of global business over the past 15 years. He has also worked as a copywriter for some of the largest corporations in the world, including ING, KPMG and the World Wildlife Fund.

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NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

The Next Generation of Finance System Technology Nicky Wilkins, bluQube In today’s world, CEOs and senior management are faced with a tsunami of new technologies. Simply finding out what is available is a major task. Evaluating the business benefits and implementing the technologies can be equally mind-boggling.

H

OW ARE we doing as a business? What’s in the bank? What’s the Profit and Loss?

How are we doing against last year? What are our competition up to? How are our sales figures? What are our costs? Are our customers happy? And can I see all this information easily, at any time, wherever I am?

To maintain this level of access to information, you and your company should make ‘embracing technological change’ a key part of your strategy, both now and for the future.

Consequences Failing to keep abreast of the latest technological developments can have serious business consequences. For example, Kodak failed to make the move to digital photography quickly enough. The former international heavyweight has now filed for bankruptcy. The now long gone Blockbuster in fact had the opportunity to buy Netflix prior to its launch, but stuck with DVD. And as we all know, the company eventually went bust in 2013.

So, as a CEO, what are the areas of finance systems technology you and your management

team should focus on? What technologies can address common pains throughout your company, such as waiting for days for a report, dealing with inaccurate data in your system, not being able to make quick, critical decisions, or tying up high-value staff with routine processes?

I’d like to start with the opportunities presented by the Cloud. Then I’ll look at how that stacks up against the alternative – the traditional onpremise approach. I’ll cover interoperability and what it can mean for the efficient operation of your company. And finally we’ll take a look at the many benefits of devolved financial systems.

The Cloud While computer buffs can trace elements of the Cloud concept back to the 1950s, the Cloud began to really evolve around the Millennium, changing forever the relationship between a company and its IT function.

Now, in 2016, Cloud computing means that, instead of all your computer hardware and software sitting on your desktop or in your company’s network, it’s provided for you as a service by a supplier and accessed over the internet.

How important is Cloud computing? I would argue that it’s a sea change for many businesses – a deep and permanent shift in how computing power is generated and consumed.

How Did We Get Here?

Professor Ramnath Chellappa was the first to use the term ‘Cloud computing’ in 1997. And 1999, saw the first service delivering applications and software over the internet.

Amazon officially launched its own Cloud computing platform – Amazon Web Services (AWS) – in 2006. AWS provides online services to websites or client-side applications – those that take place on the user’s computers.

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NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

Cloud computing means that, instead of all your computer hardware and software sitting on your desktop or in your company’s network, it’s provided for you as a service by a supplier and accessed over the internet

start-ups and larger companies in over 190 countries, worldwide.

We use the Cloud in our daily lives, such as on our smartphones, but the uptake in business systems hasn’t been as fast, despite the fact that Cloud technology brings previously unseen levels of flexibility, agility and scalability to businesses.

The Cloud allows owners to reduce their capital expenditure, improve the reliability of their IT, reduce the risk of data loss, quickly scale use up or down and much more. Your supplier takes care of everything – your company only pays for what it uses.

In short, the Cloud is a huge success.

Over 80 per cent of UK organisations have adopted at least one Cloud service, and the vast majority are extremely satisfied with the results. In fact, 94 per cent experienced tangible benefits, including faster and more flexible access to technology. But there are also intangible benefits, the same survey showed that four out of five companies experience improved customer service, greater collaboration and enhanced customer engagement.

While it is true that some companies are worried about data security and data privacy

when moving to the Cloud, the same survey showed that 99 per cent of all respondents never experienced a breach of security when using a Cloud service1.

Cloud versus On-Premise You may be planning to move to the Cloud, but is it right for you? You should always make sure your provider has expertise in delivering both Cloud and on-premise options (we do at bluQube!), to ensure you make the right choice.

For many, on-premise is the clear choice. Many companies have a requirement for in-house maintenance over their systems and data, and tangible security. But, in fact, over the last few years, Cloud has seen a wealth of developments in security. Meaning your data could be more secure there. With on-premise, you’ll also benefit from the support of in-house IT staff. If you feel like you want a bit more control over certain processes, great, then on-premise is for you.

However, with Cloud solutions, the people building the system manage it, so it’s far less likely to go wrong. And if it does, who better to resolve things quickly? Plus, they, typically, have one system to look after, unlike your internal tech team.

Then there’s the investment. New on-premise solutions come with a hefty price tag, which is why the Cloud is such an appealing option to some. Little or no upfront investment is required, and you only pay for what you use. Cash flow is improved, and you can add or remove features whenever you need them.

Choosing a Supplier So, if you’re planning to move into the Cloud, or want to expand your Cloud services, what should you be looking for in a supplier that offers a Cloudbased option for your finance system?

The Cloud brings you enterprise-level software at a fraction of the cost of traditional on-premise systems, and most Cloud services are pay-asyou-go. Your supplier provides everything – the software, the licences, the upgrades and storage.

There will also be installation costs to consider.

In which case, you need to know the cost of integrating and implementing that solution.

You also need to ask about back-end technology – what platform base do they use? Is it robust? You want complete peace of mind. bluQube, software uses Oracle, a major international player, used by some of the largest organisations in the world.

Other questions to ask your supplier include; is data securely transferred and stored in the Cloud?

How are users authenticated? Are passwords the only option, or does the Cloud provider offer some type of secondary authentication? Does the Cloud provider meet regulatory requirements?

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NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

Disaster Recovery (DR) in the Cloud can also be an attractive alternative for companies that may lack IT resources, because the usage-based cost of Cloud services is well suited to DR. You need to be sure you have a robust DR plan in place. What happens if your supplier’s server is set on fire or flooded? It’s important that your supplier explains the exact process, so you have a complete picture. At bluQube, we house our clients’ Cloud data in military-grade data centres.

We make multiple back-ups, and the technology is literally bomb and flood-proof.

Interoperability In today’s business world, interoperability is a key contributor to a cost-efficient operation.

It’s fundamentally different to the old way of transferring data, when different systems from different suppliers could not talk to each another.

Data had to be laboriously transferred, or, horror of horrors, typed in manually. A recent survey estimated that the largest cause of data loss – 24 per cent – was down to human error3.

A common business concept in the US is the 1-10-100 rule. This states that it costs $1 to verify the accuracy of data at the point of entry, $10 to correct or clean up data in batch form and $100, or more, per record if nothing is done – including the costs of inefficiencies and low customer retention levels4.

Here’s an extreme example of the dangers of manual data entry. At 2:45 pm on 6 May 2010, Wall Street plunged 1000 points in minutes, wiping $1.1 trillion off the value of shares, simply because a single keystroke – B for billion, instead of M for million. I certainly wouldn’t like to have been responsible for that typo4!

Being able to eliminate data entry errors is vitally important for any business – although a surprising number of companies aren’t aware this can be done.

Interoperability is big in our everyday lives.

For example, you may have Gmail set up on your iPhone. One is from Google, the other from Apple – two different providers. In fact, Windows, Gmail, iTunes are all from different suppliers, but they work together, sharing data, talking to each other and working perfectly, in real-time.

Case Study: Balfour Beatty For global civil engineering company, Balfour Beatty, real-time access to upto-date information is critical. Its highvalue design and construction professionals work on huge, complex, time-critical projects, overseas.

They could be in a remote jungle, a mountainous area or the Arctic tundra, where they need instant, reliable access to cost estimates, photos, blueprints, and other large files. Prior to adopting a Cloud solution, the company had been managing document uploads and downloads. It was difficult to use and constantly running out of capacity.

So they turned to Box, a Cloud-based content provider, where resources stored on the provider’s databases could be accessed via a web browser, with applications developed for computers, tablets, and smartphones. As long as employees had access to the internet, they had access to their files, wherever they were. They saved time and money, found it faster to resolve issues and easier to meet project deadlines.

In addition, Balfour Beatty employees need to share documents with an everchanging mix of international customers, contractors, inspectors, and so on. With the new Cloud-based solution, users can administer their own accounts, and thanks to a host of collaborative features productivity improved worldwide2.

The same goes for your business systems. Any supplier worth their salt should be able to work with any other systems you have, although some suppliers will insist you buy into a suite of their products to achieve interoperability. My advice is, don’t! With bluQube software, you can share information with any other supplier’s system, so your departments can choose the systems that suit them best.

With bluQube, for example, data can be updated, automatically and seamlessly as it shares information from your other business systems. You don’t have to hang around, waiting for someone else to do it. This is great for CEOs and board members when it comes to timely reporting on things like sales, customer retention, what’s in the bank, and Profit and Loss information.

Devolved Financial Software Take a look around the finance office. Are there uneven piles of paperwork on desks? Are people WWW.CEOREPORTS.COM | 5

NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

The Cloud brings you

With bluQube, they can start accessing their own reports, without having to wait for the finance team to prepare them. Clear graphs and charts make it easier for everyone to understand what’s going on. And the software lets you bring all the reports together in one place.

You can also set up tailored access, so people only see what they need to do their job, while as CEO, you have instant access to high-level financial figures – on a bespoke reporting dashboard.

The software runs across desktops, tablets and smartphones, so you get quick and easy access on the go, enabling you to make critical, high-level decisions when you are away from the office.

enterprise-level software at a fraction of the cost of traditional on-premise systems, and most Cloud services are pay-as-you-go

frantically chasing late information? Are they so busy correcting the numbers, there’s no time for in-depth analysis? You’re not alone. The latest Future of Finance Function Survey revealed that 68% of respondents do not have time for critical strategic tasks5.

Devolved financial software, such as bluQube, extends the responsibility of financial matters beyond your accounts department and introduces a self-service culture, when it comes to accessing and processing finance-based data.

What this means for you is a decrease in the administrative burden on your finance team. As non-finance employees can input basic data and check documents, your high-value finance team save time on producing reports each month, becoming free to take on more strategic tasks and investigate opportunities.

The benefits are passed on across your business too. Non-finance staff can approve purchase orders and other important financial documents, immediately. Budget holders have daily access to up-to-date information, as well as summaries.

You may have already incorporated an element of devolved access, but bluQube offers features which really enhance the experience, such as intuitive design with bright, bold colours and user-friendly screens to help people find their way around.

Take Advice from the Experts As a CEO, you need to weigh up all the technological options to make the right choices for you and your company.

But the technologies are changing and getting better all the time. So it makes sense to talk to an experienced, well-informed supplier about the Cloud, the on-premise options, interoperability and devolved financial solutions.

Allowing you to be provided with the data you need to make smarter, faster, decisions, and move your company confidently into a successful future.

Has this piqued your interest? Head to http://software.bluqube.co.uk/nextgeneration to find out how bluQube can help you.

Contact bluQube The Hophouse The Old Brewery Business Park 7-11 Lodway Pill Bristol BS20 0DH 08456 44 77 88 hello@bluQube.co.uk

References:

Stats in this section: https://www.outsourcery.co.uk/media/1180/cloud-industry-forum-paper-15.pdf

Case study page 14:

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http://studylib.net/doc/7254559/cloud-computing-sam---raymond-j.-harbert-college-of-business Databarracks:

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http://www.scmagazineuk.com/human-error-no1-cause-of-data-loss-say-it-professionals/article/440501/

4

Ungerboek Software:

https://ungerboeck.com/blog/when-good-info-goes-bad-the-real-cost-of-human-data-errors-part-1-of-2

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Source: https://www.aptitudesoftware.com/cfos-are-overstretched/

NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

Thriving in the Digital Age Tom Cropper, Editor Adapt or die is the mantra of the business world in the digital age, but doing so successfully is not as easy as it seems.

A “

RELATIONSHIP is a lot like a shark – it has to keep moving forward or die”. So said Woody Allen in the film Manhattan, but he could equally have been talking about the world of business. Technology has revolutionised the way companies work in so many ways. Those that adapt successfully have thrived; those which did not have died off.

Success or Failure Take the example of the retail giant HMV. Once a thriving business, it failed to spot the emergence of online shopping. The result – customers deserted them in their droves for the likes of Amazon and Netflix. People simply didn’t buy DVDs or CDs from the high street anymore, and why should they? They could get them cheaper elsewhere. HMV is still with us, albeit on life support. It was bailed out by its suppliers in 2012 but its future is mired in uncertaintyI. It has joined the digital revolution with HMV Live, but has a huge amount of ground to make up on the likes of NowTV, Amazon, Spotify and Netflix.

The business world is also going digital. Cloud computing, which is already a staple part of our day to day lives through the likes of Instagram, Dropbox and Facebook, is now increasingly being used to provide more effective real time management of financial information. According to data from Synergy Research Group, the worldwide cloud computing market grew by 28% to $11bn in 2015. Public IAAS/PAAS accounted for much of this growth by increasing at a rate of 51%. Software As A Service products (SAAS), such as Salesforce, grew by 30%II. Leading developers say their business is coming close to doubling year on year as more and more companies store increasing amounts of data online.

Where there’s growth there’s activity. The market is promising with huge potential for growth. Only now is the business world is latching onto the possibility of managing systems via the cloud, which means experts confidently expect the market to grow rapidly over the next few years.

That brings with it a new gold rush as companies of all sizes scramble to get in on the act. With

that, though, comes real variation in the quality of service you might expect. Providers differ wildly in terms of the sophistication of the platform and the services they offer. Those managers investigating the possibility of switching from inhouse financial systems to the cloud can feel as if they are overloaded with possibilities.

Competition and Innovation However, competition is driving innovation which means the possibilities available are expanding.

When integrated effectively into a business, they can have a major impact on operations and deliver critical competitive advantages.

The first is the accuracy of accounts. Manual inputting of data gives rise to human error. In old fashioned systems based on Excel, one mistake can snowball into a major problem for a business. Take the example of Tibco Software Group. A single mistake, in a single Excel cell, led to the company being under-valued to the tune of $100millionIII – great news for the buyer but mortifying for the individual who made the error. The Canadian power generator, TransAlta, meanwhile, lost out on $24million, when a clerical error caused it to buy more US power transmission hedging contracts than it should have doneIV. A 2012 study from F1F9 estimated that 88% of spreadsheets had errors in them and were costing companies around the world. The damage was being felt in lost revenue, increased expenses, fines, lost jobs and damaged reputations.

Automated cloud based accounting systems reduce the likelihood of errors, making them easier to spot and rectify.

They can also reduce the risk of duplication.

Businesses can suffer from having multiple copies of accounting information within a number of different documents. Deciding which one shows the true picture can be impossible. A cloud based finance system provides a single repository where employees can log in to add information onto the same file. It creates a single version of truth, reduces confusion and improves the accuracy of reporting.

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NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

A company can benefit from faster real-time financial reporting, which contributes to better business decisions across the board

Cost versus Reward A company can benefit from faster real-time financial reporting, which contributes to better business decisions across the board. An existing system, for example, might provide a cash flow report every few months. This might be considered acceptable, but it means managers are constantly working on increasingly outdated information. If a company’s cash-flow is volatile, this can increase the chances of it experiencing an unexpected threat to its health.

With an online automated accounting system, managers can order a cash flow report quickly and with minimum effort making, it much easier to assess the state of finances and to make any changes accordingly. The true extent of these benefits can be difficult to quantify as they have a knock-on effect across the scope of the business.

The most eye catching benefit, though, could be the price. Whereas a piece of accounting software will require significant upfront costs, cloud based applications require only a monthly subscription. Managers can also better tailor their system to their requirements meaning they get

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exactly as much or as little information as their company requires.

There are, however, issues with some cloud computing services. Customers may fear losing control of their data. It would be stored on servers in another location and, possibly, another country. If the cloud service provider experiences a problem, it could hinder a company’s access to its own financial information. Security of information is also a constant concern with data being stored offsite and accessible online.

Quality of service varies considerably. Some providers offer more support than others; packages may be more or less interoperable, meaning they may not be able to connect to other software packages within your workplace. The best solutions work to communicate with different packages from different providers. When making the decision, buyers need to understand their needs and how a solution can best meet them.

Having a good awareness of the market, what’s available and where this technology is heading in the future can also play a crucial role in improving the quality of service they receive.

NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

Choosing the Best Systems Jo Roth, Staff Writer Companies are scrambling to adopt cloud computing services, but making them work well remains a challenge.

T

ECHNOLOGY HAS forever been changing the way in which businesses work. Whether it’s the introduction of the first computers, the arrival of the internet or mobile computing, technology can open up new opportunities and change the way businesses function. However, it can also have a negative impact. When users start focusing on the sophistication of the technology – rather than its end use – problems can occur.

A business might decide it wants to introduce a new finance control system. However, doing so may mean uprooting existing operations which have been working well for years, and re-training employees in new ways of working. There will be a natural resistance to any change, and the risk that the transfer to a new system may create more problems than benefits. Therefore, before any manager chooses a new system, they need to make sure it can offer clear and tangible rewards.

Simple and Easy Many systems can may offer plenty of functionality, but at the same time they can be complicated and difficult to understand or install. They may be inflexible, forcing operators to change the way they work.

There is another approach and that is to provide a system which fits in around the end user. That means something which is flexible, accessible, simple to understand and can be tailored to the specific requirements of any business.

The aim is to produce a piece of software which can be used and understood by everyone within an organisation whether they work in the finance department or elsewhere in the business.

Technology needs to be smarter and intuitive. If it is, a business will be able to devolve accounting across the organisation. All those who need to can see the accounts and so make better and more productive business decisions.

The software has to be able to talk to other systems. While some producers require an entire suite of software services, which can communicate only with one another, the most

successful products today are those which can talk to other systems within the organisation, reducing the need to duplicate information.

The modern business increasingly requires seamless collaboration across the organisation and through multiple departments. Software is changing to adapt to those needs.

About the Provider Much also depends on the provider. If a purchase is made from a reseller, the level of technical support on offer may well be of a lower quality.

Dealing directly with the developer of the system, on the other hand, provides dedicated support from the people who know it better than anyone else. Before buying a system, have a look at the technical support on offer, and the level of advice and customer support they provide. It helps to have a system which assists all professionals within an organisation to swiftly develop a good level of expertise and understanding.

Those providers who can be responsive to your questions will also provide a better level of service. The systems which provide a onesize fits all solution may force you to adjust your processes and operations in order to fit in with the product. This can harm your business in a number of ways as employees struggle to adapt to new ways of working.

Alternatively, you can choose providers who listen and offer the opportunity to tailor their service to suit your needs. You might be able to tell them of a particular challenge you have in your day-to-day operations and they might have the creativity to design a package which meets it. The quality of the provider, therefore, can be every bit as important as the software they deliver.

Understanding the Risks As the cloud became increasingly popular, one of the biggest concerns customers had was security and the fear of data loss. As it has matured and security measures improved that fear has receded. Today businesses are more likely to be worried about expertise and operability. Even so, the sheer volume of data contained on server WWW.CEOREPORTS.COM | 9

NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

The aim is to produce a piece of software which can be used and understood by everyone within an organisation whether they work in the finance department or elsewhere in the business

based cloud systems represents a tempting target for fraudsters. The severity of a breach will depend on the nature of the data which is stolen. Much is made of the theft of customer information, but the biggest impact can come if sensitive company information goes missing.

To help raise awareness and access to best practice, the Cloud Security AllianceV was formed to deliver education, certification, events and advice. It offers the following recommendations: •T o use multifactor authentication and encryption to protect against breaches: Cloud providers deploy their own security controls, but these can vary. As a business you are responsible for data security, so you need to understand the security levels offered by your cloud partner.

•M anage authentication: Weak authentication management can create a serious risk. When employees leave, organisations often forget to cancel their access. Multi-factor password authentication processes such as one time passwords and phone based confirmation can be time consuming, but will improve the security of the system.

•A ccount hijacking: Fraudsters develop a range of phishing scams to try and access account information. All accounts should be monitored to trace back to a human owner and organisations should prohibit the sharing of account credentials.

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•D istribute data: Total data loss is rare, but hackers are still accessing accounts to delete information and harm an organisation.

Distributing data across multiple zones and performing regular backups can provide a degree of protection.

Security is an ongoing balancing act – a battle between providers and fraudsters. As new providers introduce new protections, fraudsters develop new attacks. It requires constant vigilance and updated processes to stay ahead of the game.

The need today is for finance software systems which address the user – rather than the other way around. Buyers need solutions which are fast, simple to use, reliable and offer easy onthe-go mobile access from any location. This requires a set of technologies designed to fit in with the direction in which modern business is moving and the new ways in which people work. Therefore, success in this field, from the developer point of view, depends on a combination of several factors: not only do they need to design sophisticated, accessible and simple technology, but they must also deliver the support and flexibility which allows business owners to tailor any individual product to their own unique requirements.

NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

The Age of Big Data James Butler , Staff Writer Cloud accounting systems remain misunderstood by much of the business world.

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LMOST EVERYWHERE you look, you read about the transformative impact of cloud computing on the business world. Owners are described as flocking to embrace the cloud in their droves. As the technology matures, old fears about security are receding but, for all this, many businesses fail to understand precisely what it is or what benefits it can actually bring to a company.

Weighing Up Cost Against Performance The most common and straightforward answer given is cost savings. Companies which have installed cloud systems have reported savings around 30%VI. However, the calculation is complicated and will vary for every organisation.

Any calculation needs to take into account ongoing monthly subscription charges – these are typically lower with a cloud application – together with infrastructure costs. Maintaining an on-site facility involves considerable expense through equipment and labour. The situation may be muddied where a company has legacy accounts software which is now several years old and already paid for. They may believe their legacy software presents a more cost effective approach.

However, costs come through the age of the software. If it’s five years old or more the chances are it offers a much reduced performance compared with latest technologies. Companies suffer through longer processing times, inaccurate data entry and limited access.

It is this performance which offers many of the key benefits new systems can bring. Faster accounting leads to saved time, reduced errors and better decision making – all of which leads to lower costs and increased savings.

So, even if in-house software is paid up and not incurring a monthly cost, it can still represent a drain on resources.

This is where the cloud truly comes into its own. It frees up a huge amount of time; monthly reports which used to take weeks can be done in just a couple of days. If cloud accounting software is truly integrated with existing systems, it will eliminate the need to input the same

data multiple times, which in turn reduces the risk of error. Gone are the days when a company had multiple versions of the same data leading to duplication and confusion. Managers can draw up reports quickly and efficiently to view the precise state of the company finances – which can lead to better decision making.

Cost savings also come by moving more and more data online and reducing paperwork.

According to PricewaterhouseCoopersVII, finding a lost document costs a business, on average, $122. Approximately 7% of all documents are lost completely – for a large scale organisation, this mounts up to an enormous drain on resources.

By progressing towards a paperless office, companies can do a great deal to reduce the number of documents they lose and so minimise the impact on their businesses.

Keeping Track The transparency and accessibility of information also helps businesses to manage their invoices more effectively. A 2014 study from Bacs Payment Schemes found that unpaid invoice payments costs small businesses £40bn a yearIX. SMEs are more likely to experience a longer wait for invoice settlement than larger corporations. Part of the reason is debtors who are unable or unwilling to pay, but companies also suffer because they lose track of which invoices are still outstanding.

An automated system can alert managers to any outstanding invoices and help them to chase them more effectively.

Furthermore, cloud accounting systems help a company mature. All small businesses pass through various stages of maturity – from infancy in the first few years, to maturity. As a company passes the £1 million turnover mark, its accounting requirements will change enormously. It will go from a situation in which one person can manage all the accounts within a simple software package to a sophisticated in-house accounting system. A cloud package provides a cost-effective way to scale up the efficiency and capabilities of a system.

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NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

A cloud system takes away much of the hard work – it acts as the in-house expert, and frees the business owner to concentrate on other things

frees the business owner to concentrate on other things. As a company grows and matures, most CEOs look to step back a little and take a more strategic view of the company. By doing so, they can concentrate on the bigger picture and steer the business forward far more effectively.

Business leaders often complain that they find themselves dogged down in the administration and day to day running of the business. The biggest problem with this is that they are not getting the most out of their own time. By spending all their hours on work which pays the business £10 per hour they are failing to devote enough time to the jobs which can bring in thousands – for example developing a business strategy, forging new contacts or securing new sales contracts. It’s a good way to ensure the business gets the most out of one of its biggest assets – namely the chief executive.

None of this is to say that the cloud has been perfected – and it may not be appropriate for all situations. There are still questions to be answered about security, and optimisation among others. Storing information in the cloud means

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significant amounts of data will be stored on a third party’s servers. That will only be as safe and secure as their own security protocols.

Choosing the Right Provider Overall, though, the business case for the next generation of finance technologies appears convincing. They can save time and money, enabling professionals to access more information on the go, reducing the risk of accounting errors, providing a transparent analysis of real time financial decisions and empowering business leaders to make better and more profitable business decisions. All this, of course, comes with the caveat that new technologies must be integrated in the correct way. Much depends on the strength of the provider, the level of support they offer and the flexibility of the software. Get it right and the rewards can be transformative for a business; get it wrong and you’ll be left scratching your head wondering why it’s not delivering the benefits promised. As always it’s not just about the technology itself; it’s about how it integrates with a business.

NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

The Future is in the Clouds Tom Cropper, Editor Cloud accounting systems promise to be the next great transformative technology for businesses.

W

HENEVER A company grows and expands it needs new systems, tools and processes to manage the change.

Unfortunately, many companies are pushing the boundaries of their businesses while still using outdated accounting systems.

Take the example of Exor Corporation – a rapidly growing company which was venturing into new markets. However, their accounting team was still using the same Sage software they always had.

As their Finance Director, Kay Quance recalls, they needed something new.

“The product did not have either the stability or breadth of functionality we needed as Exor grew... It was a constant nightmare because the system would regularly fall over, we would lose data and it was just too slow... The Sage and TAS systems were simply too limited, so we needed to find a replacement.”

A Tailored Solution The solution came through a next generation cloud accounting system. Developers bluQube worked closely with Exor to develop an integrated accounting system which worked with their existing systems and ensured information only ever needed to be inputted once. The system ensured that critical business information became instantly available from multiple locations, helping them to make more effective and profitable business decisions. Month end reports, which might previously have taken several weeks to compile and deliver, were now available within a couple of days.

This one example illustrates where the most successful cloud accounting solutions are heading. With the market demonstrating huge potential, there are plenty of providers entering the field – all of them offering varying levels of support and service. Those that survive will be the ones which adapt most effectively to new technologies and changing demand.

The cloud accounting market is booming with small and medium sized businesses representing a key battleground. Although activity in this market has been busy, it has only begun to scratch the surface. All that, though, is about

to change. Data from Intuit and Emergence Research suggested that the majority of small businesses could have adopted online cloud accounting by the end of the decade. It said that 78% would be using it by 2020 – up from the current rate of 37%.

Steve King of Emergent Research said: “Today, the U.S. and global economy is going through a series of shifts and changes that are reshaping the economic landscape. In this new landscape, many people are using the power of the cloud to re-imagine the idea of small business and create new, innovative models that work for their needs9.”

The Battle for Small Businesses For small and medium sized businesses, such plug-in technology represents a fast and affordable way to improve their capabilities and compete on a much larger scale. Elsewhere, the same report predicts SMEs will increasingly compete with larger companies. For example, the report cites the way in which smaller hotels and B&Bs are using services such as Airbnb to compete with much larger chains.

The report also suggests online accounting could lead to more hives – virtual teams and companies collaborating in multiple locations around the world on a single project. The need for a bricks and mortar location will increasingly recede. Freelancers could also benefit as it helps them take on more clients and connect remotely with various teams.

There are problems with the cloud. Security has long been a primary concern of businesses, but as they become more familiar with these systems and as their use increases, they are becoming more comfortable. A report into the state of the cloud stated that security is no longer the top concern and has been replaced by lack of resources and expertise. Cost challenges are also increasing; 26% of respondents to the survey identified cost management of cloud systems as a major issue – up from 18% the year beforeX. Few companies, the report found, are taking action to manage costs, meaning there is considerable scope for savings in cloud management in the future.

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Security has long been a primary concern of businesses, but as they become more familiar with these systems and as their use increases, they are becoming more comfortable

It all feeds into one of the key advantages of the Exor Corporation’s new cloud system. It works because they collaborated with the developer to produce a system which was optimised to their needs. They came to the developer with a problem – and the developer created a solution.

This could offer a hint at what all sides need to do to realise the full potential – they must fit the solution to the challenge and ensure any cloud accounting options are optimised for their specific end use.

Can Legacy Systems Survive?

The cloud seems to be the future – but what of existing on-premises finance systems? Will these still have a place? A report from Gartner in 2014 predicted that, by the end of 2016 they would increasingly be referred to as legacy technologiesXI. Compared with new cloud solutions, these would appear long in the tooth. Even so, the transfer to the cloud could take ten years or more. For all the advances of recent years, this still looks and feels like frontier technology. It’s changing fast and understanding remains patchy. Many companies have used the so called ‘legacy’ option for many years – they’ve worked on it and customised it to their own requirements and will naturally be reluctant

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to let them go unless they can see a clear return on investment.

On premises computing is still alive and well, but it is developing. IT staff will soon no longer have to set up separate servers for individual applications thanks to the rise of server virtualisation.

A number of virtualisation server products enable departments to manage multiple servers more easily and with fewer physical resources.

This entire space is moving quickly. Competition is spurring innovation and innovation is changing fast. The market will enter a period of continuous innovation where apps need to be capable of delivering updates quickly and efficiently to the end user. The increasing use of metrics will also help developers to see how their customers are using systems in real time – this helps them deliver more effective customer support and make improvements to their systems.

The future, then, may well be in the cloud. But it’s still far from clear what exact form that future will take. In general, though, finance systems are becoming more economic, more intuitive and easier to access. By staying agile and effectively implementing new technologies, companies can achieve a number of small gains which add up to a major advance for the organisation.

NEXT GENERATION FINANCE SYSTEM TECHNOLOGY FOR ON-PREMISE AND CLOUD DATA STORAGE SOLUTIONS

References:

HMV Bailed out by its Suppliers: http://www.yorkshirepost.co.uk/news/cash-strapped-hmv-is-bailed-out-by-suppliers-1-4166372

I

Round up of Cloud Computing Trends:

II

http://www.forbes.com/sites/louiscolumbus/2016/03/13/roundup-of-cloud-computing-forecasts-and-market-estimates-2016/#112659574b07 Excel Mistake Costs Tibco Shareholders $100million:

III

http://blogs.wsj.com/moneybeat/2014/10/16/spreadsheet-mistake-costs-tibco-shareholders-100-million/ Excel Snafu Costs Firms $24million: http://www.theregister.co.uk/2003/06/19/excel_snafu_costs_firm_24m/

IV

V

Cloud Security Alliance: https://cloudsecurityalliance.org/

VI

How to Explain Cloud Migration Costs: https://www.cebglobal.com/blogs/how-to-explain-cloud-migration-costs-to-the-cfo/

VII

Paperless office: http://www.thepaperlessproject.com/the-impact-and-inefficiency-of-paper-in-the-office/

VIII

SMEs face $40bn in Unpaid Invoices: https://www.theguardian.com/sustainable-business/proposed-law-disclose-late-payment-practices

IX

Intuit Study Shows how the Cloud will Transform Small Business:

http://www.businesswire.com/news/home/20140808005075/en/Intuit-Study-Shows-Cloud-Transform-Small-Business X

State of the Cloud Survey: http://www.rightscale.com/blog/cloud-industry-insights/cloud-computing-trends-2016-state-cloud-survey

XI

Today’s Systems Will Soon get the Legacy Label:

http://www.pcworld.com/article/2092740/gartner-todays-onpremises-erp-systems-will-soon-get-the-legacy-label.html

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Notes:

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