Why is cloud-based technology spreading so quickly among companies of all sizes? And why should tax professionals consider how their IT colleagues’ function is evolving?
There are several compelling reasons, including this one: 62 percent of companies report that their cloud computing investments enable them to invest more money back into their business (improving profits by an average of 22 percent). That figure comes from a study of small to mid-sized enterprises (SMEs) conducted by Rackspace and research firm Vanson Bourne. While this statistic helps explain why SaaS (Software as a Service) and other forms of cloud technology are so attractive to companies, there are several other benefits driving cloud adoption. Here’s how finance function respondents (again, those in SMEs) in the same study ranked the benefits of their cloud investments:
- Cloud computing reduced our IT costs;
- Cloud computing has enabled us to invest more money back into the business;
- Cloud computing has reduced the need for our IT team to maintain infrastructure, and given us more time to focus on strategy and innovation;
- Cloud computing has improved our disaster recovery and business agility; and
- Cloud computing has helped us increase profits.
New surveys of cloud computing’s use by companies suggests an evolution toward the realization of more strategic benefits.
Pointing to survey results in a new report by Harvard Business Review Analytic Services, CIO Senior Writer Thor Olavsrud notes:
In early years, cost savings were highly touted. More recently business agility was the top-cited primary driver of cloud adoption (so said 41 percent of respondents to last year’s survey). This year, however, fully 72 percent of respondents said collaboration was a top benefit (with 71 percent still citing agility).
The same survey indicates that 52 percent of respondents (452 business and IT executives from around the world) reported that involving central IT in cloud purchases and management has lowered cost and complexity. That means that tax-IT collaboration is an important step in the purchase of cloud-based tax technology. It also means that tax professionals should consider how their IT colleagues’ function is evolving.
The rapidly evolving benefits of cloud technology are examined in a new Vertex white paper The Future of Tax Can be Found in the Cloud and outlines why cloud technology solutions will become the primary way of accessing tax technology in the future.
Please remember that the Tax Matters provides information for educational purposes, not specific tax or legal advice. Always consult a qualified tax or legal advisor before taking any action based on this information.