CFOs in the Age of Cloud Computing

7/30/2019 CFOs in the Age of Cloud Computing

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Apps for Business

CFOs in the Age ofCloud Computing

A report on cloudcomputing benets

to Asia Pacicbusinesses


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Contents

Why Asia Pacic businesses are looking up to the cloud. 3

Insight through research. 3

What prompted this research. 3

Cloud computing by denition. 4

How companies view the cloud. 4

What the research shows: 5

1. CFOs in Asia Pacic have a high awareness of cloud services. 5

2. The majority of Asia Pacic businesses are already adopting

or are planning to adopt cloud services. 6

3. Finance decision makers know that cloud services provide

quantiable benets to their business. 7

4. Over half of Asia Pacic CFOs believe that the CFO will become

more inuential in procuring and managing IT services. 9

The CFO in the age of the cloud. 10

Keeping ahead via the cloud. 10

So where does this leave us? 10

Appendix. 11


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Why Asia Pacic businesses are looking up

to the cloud.

Its no secret cloud computing is being eagerly and rapidly adopted across a diverse range of industries

and territories, including Asia Pacic, where research shows it continues to achieve critical mass. As

its popularity soars, companies yet to get on-board with this evolving technology face the eye-opening

reality of watching their competitors with a cloud solution in place surpass them.

Along with an awareness of the substantial benets cloud computing brings to enterprises, our

research shows that Asia Pacic CFOs are quickly recognising that cloud technology is not solely a

matter for IT department consideration, but a decision-making process that directly involves them.

Finance decision makers across Asia Pacic are realising that the adoption of cloud-based services will

become crucial to the overall success of their organisations over the next 12 to 18 months.

For CFOs in particular, the acknowledgment of benets including dramatically reduced IT costs and

increased workforce productivity underpins their consideration to adopt this technology.

Insight through research.

Google Enterprise Asia Pacic recently commissioned independent research rm, Vanson Bourne,

to survey 400 CFOs and other top nance executives across Australia, Hong Kong, India, Malaysia,

Singapore and Taiwan to gain insight into how these decision makers view the importance of cloud

computing to their business.

Our results show nance decision makers agree that adoption of the cloud within their business

reduces operation costs, improves eciency and empowers innovation.

What prompted our research.

The idea of new computing technologies having the potential to transform enterprises is nothing new.

However, who decides whether or not to adopt these new technologies is an onus that is shifting.

Knowing that senior nance decision makers constantly seek eciency savings and new business

benets, our survey aimed to discover how their decisions are being aected by cloud computing.

In the past it has been the organisations IT department that has directed the adoption of new

technologies. However, our research took a dierent approach, and looked at the emergence and

adoption of cloud computing from the viewpoint of the nance department, rather than from an

IT perspective.

CFOs and other senior decision makers within the nance departments regularly seek the most

ecient, cost-eective ways to keep the organisation growing, and the extensive benets and cost

savings that come from implementing a cloud computing strategy continue to pique their interest.


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Cloud computing by denition.

Cloud computing can be dened as a benet-driven operations solution that delivers scalable

IT resources via the web, as opposed to hosting and operating these services locally. These

resources include tools, applications and services, in addition to the infrastructure in which these

services operate.

By deploying these tools and services over the web, companies and organisations can access resources

on demand and signicantly reduce (or possibly even eliminate) software and hardware costs.

Additionally, a business IT capacity can quickly and easily adjust to changes and demands, making the

exible nature of cloud computing immensely appealing.

Perhaps one of the most valuable benets of the cloud is the ability for employees to access,

update and share les, documents and data, and use software applications from anywhere there is

internet connectivity.

In eect, allowing a workforce spread throughout global locations to work seamlessly as one.

How companies view the cloud.

As ndings throughout our research shows, cloud computing has the potential to bring quantiable

business benets to organisations. Its not surprising that the vast majority of the 400 nance decision

makers in Asia Pacic interviewed stated they have adopted or are planning to adopt cloud services

within their organisation. Those who have adopted cited those quantiable business benets to

include: increased exibility, increased capacity and the ability to transform some IT items into

operational expenses, as driving forces behind their decision to adopt.

On average, respondents said that cloud computing provides them with business improvements ofat least 18% in factors such as speed-to-market for products and services, rate of growth, process

eciency, and employee productivity.

The movement towards cloud computing is now also making CFOs much more informed and involved

in IT procurement.


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What the research shows.

1. CFOs in Asia Pacic have a high awareness of cloud services.

Most nance decision makers in Asia Pacic are already aware of cloud computing, at least in name if not

in detail (as seen in Figure 1). Our research shows that 91% of CFOs are reasonably familiar with cloudcomputing to some degree, with 14% being totally familiar with the term.

Figure 1: How familiar are you with the term cloud computing?

9% no familliaritywith cloud computing

77% are in some way familiarwith the term cloud computing

14% total familliaritywith cloud computing

91

%

As outlined in Figure 2 below, the ndings across Asia Pacic indicate that the majority also understand

that cloud computing brings a valuable array of business benets that include increased exibility (61%),

capacity (65%), and moving items from CapEx to OpEx (51%).

Figure 2: Summary of those who agree that cloud computing provides each of the

listed statements, analysed by country.

It can deliverincreased scalability

Australia

It reduces the costof M&A integration

It lets us move some IT itemsfrom a CapEx to an OpEx item

It can deliverincreased flexibility

It can deliverincreased capacity

Hong Kong

India

Malaysia

Singapore

Taiwan

14%

26%

30%

28% 33% 55%

65%

38% 54%

58%


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These numbers are comparable to the perspectives we found in a similar research project conducted

in Europe, which showed positivity surrounding cloud computing is rapidly becoming a global

trend among CFOs.

Though capacity is the most recognised business benet, the potential for increased exibility is most

popular in India and Hong Kong. Broadly speaking, India emerged as most positive in their feelings

towards all of the various benet statements.

2. The majority of Asia Pacic businesses are already adoptingor are planning to adopt cloud services.

Figure 3: Have you already implemented or are planning to implement cloud

computing within your organisation?

11% No, but evaluating

26% No, but making plans

8% I dont know

15% No, and no plans

41% have implemented

67%

Figure 3 shows that 67% of CFOs surveyed have already adopted cloud computing or are making

plans to do so. Additional ndings show that 92% of senior nance decision makers said they

knew their organisations cloud computing strategy, and as seen in Figure 4, on average 57% have

been either involved or played a central role in the decision as to whether or not cloud computing

should be adopted.

Figure 4: How involved were you in the decision as to whether cloud computing

should or should not be adopted by your organisation?

No, not at all

Malaysia

Taiwan

India

Singapore

Hong Kong

Australia

Yes, I was involved, but not central to them

Yes, I was central to those decisions


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As seen in Figure 4, there are variations from country-to-country on how involved CFOs are with their

organisations adoption of cloud. 76% of those CFOs in India said they have been involved or were

central to these discussions, compared with 50% in Australia. Almost 40% of respondents in Hong

Kong said that they have played a central role in the cloud adoption decision, compared to only 6% in

Taiwan and 10% in Malaysia.

This variation roughly correlates with where that region is on the cloud computing adoption curve.

Regardless of the territory, there is clear evidence that shows Asia Pacic CFOs are taking an active

role in the decisions around adopting the cloud into their organisations.

3. Finance decision makers know that cloud services providequantiable benets to their business.

Figure 5: Percentage of those who believe that each of the listed factors is a

quantiable benet from adopting cloud computing.

Reduced IT maintenance costs

Reduced operational costs

Reduced IT spend

Improved process efficiency bybetter internal collaboration

Increased employee productivity by better internalcollaboration and access to information

Reduced M&A integration costs

Enabling fast growth by delivering scaled-up infrastructure andthereby integrating companies brought together through M&A activity

I dont see cloud delivering any of these business benefits

93% of the Asia Pacic CFOs interviewed believe that cloud computing provides their business with at

least one of the benets outlined in Figure 5 such as reduced IT maintenance costs, reduced IT spend,

downscaled operational costs, exibility, scalability and improved process eciency.


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Figure 6: Where do you see cloud computing in relation to the success of your

business in the next 12 to 18 months? (analysed by country).

Taiwan

India

Singapore

Hong Kong

Australia

Not Important

Important

Malaysia

Similarly, Figure 6 shows that on average 94% expressed that cloud computing is going to be crucial to

the success of their organisation over the next 12 to 18 months.

Figure 7: Percentage of those who believe that each of the listed traits provides

signicant business benets to their organisation.

The reduction of the numbers of servers, the software cost,the number of staff can significantly reduce IT costs.

The flexible capability that can be turned up,down or off depending upon circumstances.

The latest versions of the applications needed to run the businessare made available to everyone as soon as they are available.

Connection is always on and therefore reliable when we need it.

During a recession, cloud computing offers aflexible cost structure thereby limiting exposure.

With cloud computing, the costs can be muchmore flexible than with traditional methods.

Improved mobility: data and applications are availableto employees no matter where they are in the world.

Cloud computing is more cost effective than traditional methods.

Could computing improves collaboration, hence reducingour time-to-market/improving our product development.

We have already seen that senior decision makers believe that cloud computing can deliver increased

exibility and capacity, and as Figure 7shows, we questioned further to discover which particular

characteristics of cloud computing the CFOs surveyed consider more important than others.

Top of the list is cloud computings ability to reduce costs, though narrowly behind this is the potential

to be exible, delivering the latest software versions, the always-on nature of access to data, a exible

cost structure and improved mobility.


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4. Over half of Asia Pacic CFOs believe that the CFO will becomemore inuential in procuring and managing IT services.

Cloud computing also has an impact on what is expected from a CFO in the future. Figure 8 shows that

on average 56% of Asia Pacic CFOs believe that as IT increasingly becomes an issue of procurement,

this will, in turn, result in the CFO becoming more inuential in the procurement and management of

these services.

Figure 8: Given that cloud computing increasingly turns IT into an issue of

procurement, do you think that the CFO will become more inuential in procuring

and managing IT services?

Less influential

Malaysia

Taiwan

India

Australia

No change

More Influential

Singapore

Hong Kong

We also asked if the widespread adoption of cloud computing would result in an increase or a

decrease in any of the functions within the IT department described in Figure 9 below. Few decision

makers within the nance function believe that cloud computing would result in decreases in the IT

departments importance.

Figure 9: Do you think that the widespread adoption of cloud computing will result

in an increase or a decrease in any of the following within the IT department?

ontr ute to corporate strategy

Ability to innovate

Budget

Headcount

No Change

9%

Decrease

Increase

A further revelation was made by noting the fact that 63% of CFOs expressed the view that the use

of cloud services would then free up the IT department to innovate, and increase its contribution to

corporate strategy.


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The CFO in the age of the cloud.

The research shows that CFOs are being presented with the opportunity to get involved in the decision

whether or not to implement a cloud computing strategy into an organisation.

Findings suggest that CFOs who are lagging behind in adoption consideration and understanding, run a

very real risk of putting their organisation at a distinct disadvantage.

Our research also found that CFOs who say they are very familiar with cloud computing have a better

understanding of the business benets that cloud oers when compared to those that are less familiar

who risk being left behind.

We have also seen evidence that suggests the CFO may become more involved in strategic decisions

concerning IT procurement. As seen in Figure 8, these gures vary by country.

More than half of those surveyed in Australia, Hong Kong, India, Malaysia and Singapore believe that

the CFO will become more inuential over IT procurement as a result of cloud computing, compared to

32% of those in Taiwan. Nonetheless, in every country surveyed, only a small minority believe that the

CFOs role in IT decisions will become less inuential.

Keeping ahead via the cloud.

Cloud computing has been around long enough now and reached a degree of maturity that the

benets are visible, signicant and aect the entire enterprise.

As a result, we have found that throughout Asia Pacic, there is real momentum gathering around the

decision to adopt cloud-based solutions.

While a great number of CFOs understand that cloud computing brings multiple benets, the

opportunity remains for a large number of them to increase their level of understanding, their level of

inuence over IT procurement and to increase the growth and success of the business.

So where does this leave us?

The reality is, the cloud revolution is here to stay and research suggests that the days of IT services

running cloud-free are well and truly numbered.

Findings that 67% of Asia Pacic organisations have already adopted or are planning to adopt the

cloud supports this. CFOs and nance decision makers need to adapt and adopt in order to remain

competitive, simply because they are living in a time when their inuence is expected to extend over

the technology of business and the business of technology.


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Appendix.

Research methodology

Google Asia Pacic commissioned independent specialist technology market research company,

Vanson Bourne, to undertake the research upon which this report is based. 400 interviews werecarried out in August and September 2012 with senior decision makers within the nance functions of

enterprises (dened as those businesses with 500 employees or more). Interviews were performed in

each of the following countries:

Australia (80 interviews)

Hong Kong (80)

India (80)

Singapore (60)

Taiwan (50)

Malaysia (50)

Data was collected by online interview, using a rigorous screening process.

Respondents came from a wide variety of business areas; hence, the content of this report can be

considered to be a snapshot of enterprises in each country as a whole, rather than covering specic

sectors. For reference, respondents in this survey fall into the following sectors:

Financial services, including insurance (86 interviews)

Retail (35)

Transport (12)

Telecoms & utilities (22)

Media & entertainment (12)

Healthcare & pharmaceuticals (34)

Manufacturing (90)

Business and professional services (38)

IT & Technology (28)

Mining & natural resources (9)

Public sector (34)

Results discussed in the main narrative are based on the entire sample.

2012 Google Inc. All rights reserved. Google and the Google logo are trademarks of Google Inc. All other company and product names may be trademarks of the

respective companies with which they are associated.

CFOs in the Age of Cloud Computing

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