Seen as a low-risk way to boost operating efficiencies, cloud-based digital and data tools are capturing a significant amount of CEOs’ strategic spend. Fifty-three percent of CEOs participating in a recent BARC Research survey reported planning to invest in cloud-based predictive and advanced analytics tools, and 44 percent plan to invest in cloud-based operational planning and forecasting tools.
Companies like BlackLine, which has inked subscriptions with more than 90 different cloud vendors, view the cloud-based solutions as a way to boost operating efficiencies without committing to a huge IT spend. “Because the cloud is a subscription service, if you need to cut back you can,” explains CEO Therese Tucker. “The efficiencies are tremendous. Something as simple as automating the reconciliation of bank accounts is easily done, freeing accountants from these labor-intensive tasks to focus on more value-added contributions—like bringing to light mistakes in the numbers that could result in a financial restatement.”
“the reality is that most industries are doing digital to drive down costs and make their products more competitive.”
The ever-expanding universe of options is also driving the trend. An extraordinary array of cloud-based digital and data tools are available to replace nearly all on-premise computerized transactions and virtually every manual task—from front office sales, marketing and customer service to back office billing, accounting and the financial close. The solutions promise enhanced agility and responsiveness, accelerated product development and innovation and cost effectiveness, among other benefits.
Companies are gobbling them up: IT spending on the cloud is projected to exceed $1 trillion by 2020, according to Gartner, which predicts that more than half of global enterprises currently using cloud tools will adopt an all-in cloud strategy in the next four years.
“Obviously, every CEO is interested in digital right now, but it means different things to different companies,” says McKinsey & Company’s Tim Koller. “Some companies are investing in the IoT (Internet of Things) to run their factories better and provide better products and services to customers. But the reality is that most industries are doing digital to drive down costs and make their products more competitive.”