When discussing cloud solutions versus on-premise software, there are a lot of benefits to switching to the cloud. The first thing you’ll usually hear in any conversation about choosing a cloud-based software is the cost savings. In most cases, it’s true that there’s a potential to trim your budget significantly, but in order to sell it to your board, you should have a detailed grasp of the savings you’ll expect.
To establish an accurate total cost of ownership, you’ll want to partner with your finance division. If you have the endorsement of your finance team on your cloud transition, you’ll gain credibility and have a deeper understanding of your costs. It will keep you from choosing a cloud software that offers savings on hardware and subscriptions but eats those savings up in the move itself.
Here are several items you and your finance team will want to include in your analysis:
How you’ll categorize the money you’re spending: One of the biggest items that will affect your budget for a software investment is how you’ll categorize that spending. An investment in new hardware and software is categorized as a capital expense, while the subscription you’ll pay to a cloud service is a monthly operating expense. Even better, the subscription route allows you to cancel, while you’re likely to be locked in with an on-premise investment.
Handling implementation and upgrades: It’s difficult to measure the productivity loss with a software upgrade, but mention it to a line-of-business manager and you’re likely to receive negative feedback. Implementation and upgrades are a huge headache, and when they’re handled by a cloud provider, that headache is no longer yours. When it comes to upgrades, you’ll not only save the productivity, but your staff may not even know an upgrade is happening.
Mobile capability: This trend is not going away. Your employees require a high level of mobility, whether they are field reps or they are set up to work remotely twice a week. Try offering easy mobile access with an on-premise environment versus cloud. Cloud solutions are much more mobile-friendly, saving you productivity and supporting the life-work balance that keeps your star employees happy.
Disaster recovery and security: There’s a lot of disagreement about how safe cloud storage is, so this is an analysis your IT division has to handle. When it comes to disaster recovery, though, cloud storage prevents a location-sensitive problem that wipes out all of your data.
Cloud Source offers unbiased guidance for your company as you consider your next software needs. Give us a call to talk more about capturing the true cost of your software transition.