Go back just 5 years and you will find that businesses were faced with a stark choice in the cloud versus ‘on-premise’ debate. Cloud computing in the financial applications space was the preserve of newly formed software vendors with little or no track record. The functionality was relatively primitive and although the cloud had its attractions, conservative finance organisations were reluctant to venture into uncharted waters. On the other hand, more mature on-premise capabilities left organisations shouldering much of the IT burden. But a chance meeting in London last week reminded me that 5 years later the situation has changed quite radically.
I was at a dinner hosted by Tagetik (a provider of CPM/analytic applications), listening to a presentation by one of their customers, HSCIC who had chosen to implement Tagetik’s CPM solution for their budgeting and planning application. As luck would have it, the presentation was delivered by Michael Flintoft, its head of ICT, on behalf of the finance team whom would normally have given the talk. But uniquely, his presentation shone a light on how the cloud versus on-premise debate has shifted as established software vendors (such as Tagetik) offer both cloud and non-cloud versions of their solutions.
No longer are complex vendor selection decisions muddied by some suppliers having a cloud solution and others only an on-premise offering – now suppliers such as Tagetik can offer both. It may not sound that radical but it is liberating. For example, it means that organisations no longer need to trade-off functionality on the one hand and preferred method of deployment on the other. Having decided which software vendor best meets the organisation’s functional needs management can weigh up the operational, technical and economic benefits of each method of deployment, unencumbered by compromise in other areas.
As it turns out, HSCIC plumbed for an on-premise solution. Being a public sector organisation, the finance function were concerned about putting sensitive data in the cloud. However, in a true test of how advantageous it is to have a software vendor that can offer both cloud and on-premise options, HSCIC used the cloud to build the initial application while their hardware was on order, accelerating the project by several weeks. But contrary to much of the hype around the capabilities of the cloud, the on-premises option delivered benefits in abundance. For example, just 5 months into the project the HSCIC team were able to save 490 “resource days”, month-end reporting was reduced by 2 days and the management team saw improvements in collaboration and data quality. In effect, lifting the cloud versus non-cloud debate out of the equation helped unmask the native benefits of simply replacing an old spreadsheet-bound process with a highly automated and joined up approach based on a single unified budgeting environment.
The lesson seems to be that these days companies should expect software vendors to offer both cloud and non-cloud options. It’s rapidly becoming a ‘right’ not a choice.