Cloud Computing: Benefits and Pitfalls

Our company conducts many short-term consulting projects (c. 1 week) and faced challenges with timekeeping, resource (personnel) scheduling, expense reporting, document management, and billing. OpenAir has been a good solution for us. Our workforce is spread all over the U.S., and a cloud solution vs. server/VPN is very efficient. Integration with QuickBooks is a bit clunky, but it works.

We also use Salesforce Enterprise for tracking opportunities and commissions. We are able to move opportunities in Salesforce to create Projects in OpenAir.

From my pov as Controller, OpenAir is reasonably priced; Salesforce is rather expensive.

Our company is currently in the process of going 100% SaaS. We implemented Workday (www.workday.com) as our platform for financials in January 2009. Since going live we have partnered with Workday and successfully integrated SalesForce.com and CyberSource to streamline the customer invoicing process.

Workday has the ability to be both an HR platform as well as a Financials platform. We currently only operate the Financials platform but are looking to actually move off of ADP and onto the HR platform Workay has.

We actually don't have a per user license fee and have unlimited licenses. I love the ease that comes with Workday and the SaaS platform. Easily being able to have employees and managers log in from any where (including their IPhones) and approve items makes the process go much quicker.

I find it hard to think about working anywhere that isn't on a SaaS platform in the future.

IT Business Edge included Cloud Commputing on its list of Top 10 Threats for 2010 so it would be prudent to look into the security aspects of whatever solution you are looking at.

http://www.networksecurityedge.com/content/top-10-information-security-threats-2010&utm_source=itbe&utm_medium=email&utm_campaign=FNS&nr=FNS

#9 - Cloud Computing Security Threats (Rising Threat)
Cloud computing is a concept that is becoming very popular. While it still means a lot of things to a lot of people, using cloud based (i.e. Internet based) applications may not be as secure as you might hope. There were many stories in 2009 regarding cloud based security. Many are calling for forced encryption to access many of these services. While it seems ludicrous that this isn’t done by default, you can’t simply assume cloud apps are secure.

Some cloud computing security threats come in the form of vulnerabilities such as the October 2009 story that attackers exploited a web application flaw to hijack Yahoo Mail accounts. This was a brute force attack where the hackers use software to systematically guess the passwords. Someone even went so far as to post the passwords, where there were many common ones such as “password” and “123456”. Poor password policies and software that doesn’t limit this type of attack will always lead to compromise.

As cloud computing becomes more popular in the next few years, we will see the issue of cloud security become a very big issue. There will be no shortage of cloud based security issues in 2010.

Private Cloud security is generally superior to the public cloud...if it's for your business use only then a hosted private cloud solution may be the way to go.

1) "Is it better and cheaper than desktop/server-based or not?"

Better is in the eyes of the beholder. Some people will choose on-premise Microsoft software for their business because it has a similar feel to their Outlook and Office. Others will buy cloud computing solutions just because their on-premise system isn't cutting it and they like the idea of web-based financials and its "anywhere" access.
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Cloud Computing Pros:

a) Eliminate Hardware & Maintenance - Web-based, so there's no need to purchase hardware. Eliminate costs and headaches of maintenance on servers, databases, backups, patches and upgrades. All of it is done for you by the vendor.
b) Pay Only for What You Use- Subscription-based pricing can be less expensive than an up-front license fee.
c) Real-time data - everyone can see the same reports and collaborate without version issues
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Desktop/server-Based Pros :

a) allows you to do upgrades at your own pace
b) you "own the software"
c) complete control over issue resolution, security, data and service pack updates

Neither cloud computing or on-premise solutions are inherently cheaper.
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2) "What about implementation – high or low cost and difficulty?"

Cloud Computing : Expect to pay 1-1.5x the cost of your license fees for a solid implementation. It is usually easier because there is no hardware or software to install, just data migration and customizations.

Desktop/server-Based : Usually higher cost for hardware and integration with current infrastructure.
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3) "Some of it sounds too good to be true, to be honest"
Anyone who claims either option is inherently "better, faster and cheaper" is not being transparent. They really need to understand your needs and limitations before promising the world.
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4) "FYI, we are a mid-sized software developer (~200 emps) and are considering what to do with accounting and planning systems as well as CRM."

Another key factor to consider is which system is your company more likely to adopt. If your sales team is used to spreadsheets to track their performance, getting them to use a CRM might be difficult. Even when the CRM is enacted, the data fields in popular CRM's are free text and there are no standards for each field's entry. This lack of standardization can be a nightmare for accounting.