The year was 1996. The English Patient beat out Fargo for best picture at the Oscars, we were all listening to the Spice Girls on the radio, and at the pump, gas was $1.23 a gallon. It was also the year when an internal Compaq document referenced the term “cloud computing” for the very first time. Ten years later, with the advent of Amazon’s Elastic Compute Cloud, modern day cloud computing was born and hasn’t looked back since. In fact, it is not uncommon to see 50% yearly growth rates for vendors suppling quality, cloud-based software solutions.
The advantages of cloud computing—scalability, speed to market, lower costs and higher productivity—are well known throughout most industries.
So what’s the rub? What are the biggest challenges of the cloud? As in most technologies, the wild card in the equation is “us”, the humans. You’ve heard the proverb, “A chain is only as strong as its weakest link.” Well, I say, “A technology is only as strong as its users”.
Let me set the stage. A common phenomenon that happens during a Human Capital Management transition to the cloud is that your Human Resources department can morph into a kind of HR/IT hybrid. Many functions that fell under IT prior to the cloud will now fall under HR post implementation, for example managing and updating HR applications.
Cloud computing in a sense, has taken the IT middle man out from between the real world application and your business leaders.
Cloud takes IT out of the back office, and empowers HR and Finance with a seat at the global table. From being able to make and back up decisions from key analytics, to creating new services to support a diverse audience, HR & Finance now make strategic decisions based on business value to help the business grow. This is an amazing power shift for what was previously looked at pure ‘back-office’ functions.
Said another way, the shift from the Chief Information Officer (CIO) directing all of IT, to the Chief Financial Officer (CFO) and/or Chief Human Resource Officer (CHRO) running the Finance or HR component, empowers the business in a way that simply could not happen without the cloud. The fundamental shift to a business-driven model allows the business to drive decision-making processes, instead of being beholden to what the technology allowed them to do. Technology is now an enabler to business decisions. And, the buyer of technology and services has now appropriately shifted from IT to HR and Finance (we are also seeing this shift in student education).
For all the benefits the cloud brings, we’ve seen that this shift can cause frustration and anxiety amongst your team, and inevitably, instead of being an avenue of innovation, can be a bottle neck to productivity and growth. I also have seen teams organically grow into their own support network. Experts will self-identify through individual experiences and strengths with no real reason other than, “Tom had that problem a week ago, and I think it got fixed, Tom must have the answer.” Not that this is the worst thing that could happen, but it can leave your organization in limbo if the wrong person is on their honeymoon when the database crashes.
The challenge is simple to quantify; the solution can be a bit more daunting, but with careful planning can be achieved. From my experience in transitioning organizations to the cloud, the following points can offer a solid foundation for you to build an environment that embraces the cloud and has the ability and knowledge to fully utilize the power and resourcefulness of this new world:
Begin change management on day one.
Take time to understand the local perspective.
Consider all audiences—it’s not just HR, managers and employees
Communications, engagement, and measurement are key, not just training: communicate early, often and consistently
Each key program milestone is an opportunity to reinforce change.
Acknowledge the “behavior” changes, as well as changes to process and system.
Keep in mind that there is always a human factor in every change.
Start planning now for support post-implementation.
Identify resources—either internal or through a third-party provider—who will maximize the value of your solution by keeping up with the latest features and functionality that are released in frequent updates.
Coming back to my original premise—A technology is only as strong as its users—when you are planning and building Finance and HR in the cloud , you need to take into consideration not only the technology changes, but also the organizational shift. Consider the people that will be needed to support the new technology through all the phases—from the design and implementation to application management after the “go-live”. Plan for a comprehensive change management approach that will help your people succeed in this new world. In order to gain the full promise of cloud, HR (Finance or Education) needs to be at the table from the very beginning and remain engaged through go-live, as well as afterwards, as new functions and features become available that will strengthen your business leader’s ability to make real-time, data driven decisions in support of the organization’s mission.