For many small and medium sized businesses, cloud financial planning and management remains an anathema. Some consider it a minefield and best avoided, while others may have fallen victim to overzealous organisational dreams of world domination with little thought to the financial management of this.
If you consider accounting and financial management to be more an art than a science, then it’s fitting to accept that even the most skilled artists have to acknowledge and work within their limitations.
Financial managers need not be overwhelmed, nor should they see cloud service providers as a financial black hole. Cloud providers work on a high-volume and low margin business model that makes financial sense. An example of this is Amazon’s Flywheel business model which works on the principle that reduced prices leads to more customers which in turn leads to more AWS usage. Increased economies of scale allow AWS to increase efficiencies & lower costs. Reduction in pricing is then passed onto clients immediately and automatically.
Aligned to this, we at 1 Tech help companies of all sizes with a cost analysis prior to any cloud migration. Organisations can be confident that our robust, credible cost saving and total cost analysis will help build the business case to migrate to the cloud. As part of the assessment, we consider the organisations current IT operation to understand the company’s needs. Once established, the cloud alternative is presented including a financial view that details the savings that can be achieved by migrating to the cloud.
Cloud services are charged on a consumption-based model – so you only pay for what the organisation uses, mitigating the problem of over provisioning when purchasing traditional H/ware and services for on- premise solution. This process is time consuming as the planning, design & procurement process could take months and could result in over provisioning which results in efficiency and financial losses over the acquisition period. With the ‘pay as you go’ model the Organisation does not have the burden of purchasing and maintaining hardware and usage is easily scaled up or down based on needs.
Possibly one of the biggest challenges for finance and procurement departments is a mindset change from a CAPEX to an OPEX model for IT expenditure. Cloud capitalisation allows the organisation to align IT performance & costs to specific events in their application performance.
At 1Tech we have been focused on our client’s business needs for 20 years. We have first-hand knowledge and the experience of working with companies on defining and delivering on their cloud computing agenda. This experience means that we know what pitfalls to avoid. Our aim is to empower our client, saving them money while future proofing their business.
To find out more about the services we offer please visit www.1tech.co or contact us on info@1tech.co
Greg