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A How-To Guide to Selling the Cloud to Your Chief Financial Officer (CFO)

By Kaleigh Alessandro | Tuesday, December 8th, 2015

If you’re one of the seemingly few firms who has yet to make the move to the cloud, it could be for a variety of reasons. Perhaps you want to maintain total control of your IT environment. Or maybe you’re waiting for a tech refresh to motivate you. Alternatively, it could be that you just haven’t made the proper case to management for switching to the cloud – and many times the one who really needs convincing is the Chief Financial Officer (CFO).
If you’re the Chief Technology Officer (CTO) or IT Manager, your responsibility is determining the infrastructure choices that are going to best suit operations at your firm. But those priorities may not line up exactly with those of the firm’s CFO. IT doesn’t always have insight into the financial ramifications of an operations decision of this magnitude. Instead they are typically focused on the other benefits including personnel reallocation, workflow efficiencies, etc.handshake
The CFO, on the other hand, is ultimately tasked with ensuring the company’s financial decisions are appropriate, and therefore, it’s often advantageous to at least attempt to speak his/her language when pushing for an IT change.
So how exactly do you go about getting the buy-in from your firm’s CFO when it comes to moving to the cloud? Here’s a handy how-to guide to get you started.

  1. Understand your current IT costs. Before you can make the pitch to your CFO, you need to realize the costs your firm is currently incurring for technology infrastructure (and personnel if that will be affected by your infrastructure decision). Once you have even a rough figure, you’re better equipped to approach your CFO with a cloud proposal and can outline the various cost-savings the firm is likely to incur as a result of the move. 

  2. Do your due diligence. You’ll want to be prepared for your meeting – no need to waste your CFO’s time otherwise. Make sure you’ve thoroughly evaluated all of the appropriate cloud solutions available to you and compiled the necessary research to present to your CFO. Be sure to include both tangible and intangible benefits, such as cost-savings, scalability/flexibility of the solution, details on the third-party provider, etc. 

  3. Stress predictability. One of the greatest benefits to cloud solutions is the transition of Capital Expenditures (CapEx) to Operational Expenditures (OpEx). With the cloud, firms no longer need to drop tens of thousands of dollars on costly hardware to power operations. Rather, costs are broken down into predictable, monthly (generally per user) fees that are simple to calculate when adding or removing users. This situation is ideal to point out to your CFO, as he/she will appreciate consistent budgeting and can easily factor it into the firm’s overall budget. 

  4. Skip the tech talk. Odds are, your CFO doesn’t have an IT background. So explaining hypervisors, MPLS and intrusion detection systems shouldn’t be your first priority. Instead, focus on operational benefits and challenges and how the infrastructure decision supports the business as whole, not just the IT department. Getting into the nitty-gritty of the cloud technology will only confuse him/her and may make him/her less receptive to your proposal.

In addition to the above suggestions, we recommend you try to answer the following questions when meeting with your CFO:

  • How will the transition to the cloud shift the company's costs from capital to operating expenses?

  • How will the monthly costs change?

  • How will the annual costs change, particularly at 1 year? 3 years? 5 years?

  • What additional expenses can we expect to incur by moving to the cloud?

  • What costs (and risks) go away seeing as we will have to invest less in our own equipment?

  • How does our current IT cost structure compare with a public cloud strategy and a private cloud strategy?

  • Will transitioning to the cloud ultimately lower our costs and allow us more flexibility in approaching new business opportunities?

  • How can we audit and manage the risks associated with moving to the cloud?

Here are a few other resources you might find valuable during this process:

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