Here are some of the concerns I hear from customers when cloud-based solutions are proposed instead of on-premise implementations:

“But I might need that extra functionality in the future.”

“On-premise implementations have always worked for us, so why change now?”

“The finance department might not like this new way of doing things.”

“We hear of security breaches on cloud-based systems all the time!”

It’s important for clients to address these issues. Cloud-based systems have benefits and downsides but we need to weigh them and make an informed decision. In a series of upcoming posts, I’ll look at these customer concerns, starting with, “But I might need that extra functionality in the future.”

How to predict the future: Don’t

Technology development cycles are speeding up due to market competition. The ever-increasing appetite of consumers requires software to provide full functionality in a user-friendly interface that’s appealing to look at. Unfortunately, the software a company buys today can be outdated in a year, and support can be unavailable in as little as four years.

To counteract this situation, many enterprises buy software they believe is future-proof. In doing so, though, they may not truly examine the inherent cost of future-proofing. For example, many companies re-shuffle departments and employees every year. This leads to newly stated goals, which opens the possibility of the expensive “future-proof” software not meeting the needs of the business post re-org.

Even in the best of circumstances, it can be hard to predict how you will use your current software suite a year from now. I strongly believe in purchasing software that suits the needs of the organization today rather than guessing about long-term needs. If the company’s needs change (and they inevitably will), that’s the time to evaluate the cost of expansion in the form of buying additional licenses or adding more process workflows.

Seeing the forest for the trees?

When selecting software, some organizations get too engrossed in the decision-making process. They forget the original purpose of buying the software – to save money, speed up approvals, streamline complex process and prevent compliance issues. 

The capital saved from not buying 100 licenses that aren’t needed today can be invested in growing the company. When extra licenses are needed, the investment could potentially represent a smaller percentage of available capital, so it may be met with more rapid approval.

The role of the cloud

But where does the cloud fit into all of this? A cloud-based subscription model also preserves capital, and does not require a significant investment in hardware, software or human knowledge. With the cloud, a company accesses an existing infrastructure owned by the vendor, eliminating the need to maintain, update or replace it. 

The vendor does it all. Upgrades are largely seamless and seldom require additional resources. If your requirements change, or you prefer a competitor’s product, you can easily unsubscribe with the current vendor and subscribe with the new one. There’s no need to order new hardware, seek a refund for unused years of a license, or hire resources to implement the new software.

We rely on software to reduce operational costs. However, some on-premise software is too complex. Taking the leap to software on the cloud can reduce our costs, increase our flexibility, and truly future-proof our software. 

I would love to hear your thoughts on this issue, so please drop me a comment below.

By Akshay Agrawal

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