Cloud Computing Pros and Cons, Benefits and Pitfalls

Tim Williams's Profile

Cloud Computing Pros And Cons

I see that Proformative is offering a seminar on cloud computing later in March, but I will not be able to attend so I am hoping to elicit some insights directly from the Proformative community regarding cloud computing

 

We are considering upgrading our technology and I was wondering who here has experience with the new SaaS or Cloud platforms and what the feedback is? Is it better and cheaper than desktop/server-based or not? What about implementation – high or low cost and difficulty? Some of it sounds too good to be true, to be honest. 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.

 

Answers

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If I were implementing a new system today, I'd look at Intacct. Google them--they have an online demo.

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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.

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I have looked at a number of SaaS systems and a few things to watch for are:
1)Integration and customization costs. The vendors like to have you think there will be virtually no cost here and that this is a cost-saving area vis-a-vis "traditional" systems. Not true. Everyone has their out of the box functionality and that either works for you or it does not. I found that SaaS is just as likely to need customization as anything else, so budget accordingly.
2)Those monthly per user fees can be killer. sf.com is a great example. It gets expensive quickly if you have a number of users on it - and you pay every month. It adds up. If you are looking at having people throughout your organization use parts of a platform, say accounting, finance, HR, sales and marketing, suddenly you may have dozens of users on board and costing you every month. If you want to use something like purchase order workflow, which would be utilized by almost everyone at the company, you have to account for the cost of all of those users every month.

That said, the promise of ubiquity and access on a rental basis can certainly be attractive, but watch out for the pound of flesh. These companies are in it to make money just like the Microsofts and Oracles of the world. Note that this is not a commentary on the appropriateness or functionality of these systems, just the cost.

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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.

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How is the financial report writer functionality in WorkDay? I looked at NetSuite a couple of years ago and that was one area where they lacked.

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It definently was rocky at the beginning, but it is getting better and better over time. Workday does 3 updates each year while they are enhancing the system and continually take input from existing customers on their needs and wants.

The best thing about the reporting is the ability for the end user to create what they want and they use what they call "Worktag's" accross the entire financials application which makes it really easy to dice up the data and get the information from all different perspectives. I can pull up a P&L and then look at it for just one cost center or one line of revenue.

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Proformative Advisor
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It has been a while since you posted about Workday. Curious to see if you have any new feedback on the product. I haven't heard much about them, but the product seems interesting and they have a fantastic leadership team.

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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.

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Proformative Advisor
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I implemented Host Analystics a couple of years ago in a half billion $ revenue environment with multiple locations and department and cost center managers. We had great success with the product, in a very complex environment. Myself and my IT team were able to get comfortable with their security and in fact I would say were more secure and disaster resistant than we were in house. Updates were fast and seamless. Outside of initial set up, which still requires the work you would have implementing an on site system, my IT team had to provide little service which was great for them and FP & A. The managers loved have the data at their own fingertips and not being held hostage by accounting. I loved the process. BM

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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.

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