Senior executives at enterprises of all sizes are increasingly migrating their firms’ financial data to the cloud, a trend that is expected to continue accelerating over the next decade, according to a new study.
Market research firm Gartner says chief financial officers once hesitant about moving data to the cloud are starting to come around, noting that 2017 “is the year where there has been significant movement in cloud migration and cloud planning for the business applications targeting the office of finance.”
“The cloud has definitely changed the game for financial management business applications,” said Gartner analyst John Van Decker, who helped author the report. “Vendors have responded with new and rearchitected platforms in the cloud, and most have de-emphasized their on-premises solutions, in favor of cloud implementations, which are more profitable for the vendors, while reducing the effort of local IT support.”
Gartner surveyed 439 senior financial executives on their information technology needs, priorities and investments for the report, titled: “Survey Analysis: Once in the Cloud, Where Does Finance IT Go?”
Historically, the report notes, human resources, payroll, travel expense reporting and customer relationship management applications have migrated to the cloud at a much faster pace compared to financial business applications.
But cloud-related projects involving financial management applications have grown steadily this year, increasing from 36 percent in 2016 to 50 percent in 2017. Additionally, 56 percent of organizations have either partially or fully deployed a cloud solution for financial reporting, up from 37 percent in 2016 — and the report concludes cloud deployment for financial applications has increased significantly at organizations at small, midsize and large organizations.
While the report predicts a steady increase in the migration of enterprises moving their financial applications to the cloud over the next five to 10 years, Gartner analysts also cautioned that cloud solutions are still developing and do not have uniform capability to meet the needs of all verticals, company size and local markets.
Some other findings from the report:
- Smaller and midsize organizations have adopted cloud more rapidly than larger organizations
- Midsize and larger organizations have significant plans to move to the cloud over the next three years — 37% of respondents say that they will move to the cloud in the next three years (through 2019).
- One-third of organizations have pushed cloud migrations out past three years — 36 percent of organizations will move to the cloud after 2019, pushing off the decision to the future
- Small, midsize and larger organizations have developed cloud strategies over prior studies — Only 9 percent of organizations will not move to the cloud for half of their transactions. This is down from 18 percent last year, meaning that 9 percent of respondents that were in this category last year have developed a cloud strategy