Irvine: Not too many ERP systems have a specific budgeting or forecasting app that you can easily export into the cloud. You may need to migrate the entire ERP system to get the functionality you want. That can be a time-consuming and expensive mission, to say the least. A better alternative would be to purchase a stand-alone planning, budgeting and forecasting system in the cloud and then integrate it with the on-premise ERP system. That way, you can have your own IT people doing the implementation, without the cost of consultants overseeing the entire migration.CFO: Would it make sense to migrate pieces of the ERP system to the cloud, as opposed to the entire system at one time? Irvine: That sounds reasonable. In fact, planning, budgeting and forecasting would be a good place to start since it is a smaller function. You could integrate it into a hybrid cloud environment and the back end of the system; that way it is running parallel with the ERP. CFO: So what are the risks in migrating planning, budgeting and forecasting to the cloud?
Irvine: They’re the same as the risks that have historically challenged finance to move systems to the cloud. Finance is lagging ]customer relationship management] and HR in moving systems to the cloud, fearful of putting proprietary financial information and intellectual property out there. This is rightfully a concern. Yet, companies that do their due diligence to ensure they are going into a secure, stable environment should be comfortable with the risks.CFO: Any parting words? Irvine: Yes, I would advise readers to stringently examine the financial stability and security of vendors. Some companies have been around forever and lots are startups in the space. Not all will survive. It reminds me of the dotcom era—literally hundreds of companies hanging out their shingles as cloud providers. They may be here today, but will they be here tomorrow? This article first appeared in the newsletter CFO 360 newsletter “Planning, Budgeting and Forecasting.”