HP Financial Services: Cloud solutions – Paul Sheeran and Boorzin Hodiwalla
As corporate IT shifts towards the cloud, Paul Sheeran and Boorzin Hodiwalla of Hewlett-Packard Financial Services talk to FDE about the need for CFOs and CIOs to align finance and technology roadmaps to help achieve business value and return on cloud investment.
With the global economy cloaked in uncertainty, the term "cautious optimism" might best explain the sentiment of today's enterprises. Economic improvement is tepid, Europe continues to face considerable debt challenges, growth is slowing in emerging economies, and new regulations and game-changing technologies have been introduced almost every step of the way.
Impacting investment and growth strategies alike, the unpredictability of the economy has changed how companies operate. For the CFO, this means looking at the cash sitting on their balance sheets and deciding if they want to continue to build a buffer against economic uncertainty or invest in innovation and growth markets to remain competitive. Increasingly, they are expected to do both. CFOs need to develop a strategic-planning process that will stimulate growth and increase competitive differentiation while reducing capital costs and mitigate risk attached to economic influences.
Investments in innovative technologies such as cloud that support the underlying business needs and spur growth will play a critical role in their overall success. However, for many CFOs this requires a new approach to IT and the discussions they have with their CIO.
"With the unpredictability of the economy, increasing competitive pressures and evolving business models, we've seen a fundamental shift in how organisations operate and invest in technology to support their business strategies," says Paul Sheeran, EMEA managing director at Hewlett-Packard Financial Services (HPFS). "Today, there is a greater need to ensure that financial and technology roadmaps are aligned, especially with transformational technologies like the cloud, which can have several implications on the business and the underlying technology needed to support it."
Subsequently, IT investment cycles associated with cloud will need to be thought of as a continuous process, not just a one-time expense. Any investment in IT will need to increase business efficiency while boosting competitive edge. They will also need to be flexible and agile enough to meet the varying business requirements that are so closely tied to the economic factors influencing decisions.
"The CIO will play a critical role in helping guide the CFO down the right technology path," said Sheeran. "However, to do this, they will need to 'speak the language' of the CFO, which requires more than just delivering ROI. The traditional discussion will need to change from one focused on technology costs to one focused on business value. To be effective and gain the internal funding required, CIOs will need to demonstrate how an IT investment will impact business requirements and the financial statements CFOs report on."
To help, HP Financial Services is working with customers to bridge these two worlds. The organisation has the financial acumen and technical expertise required to effectively align roadmaps and drive the strategic value essential for growth. And in line with the current shift to the cloud, customers can leverage the expertise HP Financial Services provides, along with a range of financial and asset management strategies that can help on their transformation journey.
"We work with our customers to help them better understand the dynamics attached to the cloud and how they can help meet their strategic priorities," says Sheeran.
"It's a conversation less focused on technology and more on business benefits. The cloud is increasingly being looked at as a solution that can help lower capital investments but it can also impact IT funding models, processes and resources. Understanding the implications this could have on business strategies will vary depending on the cloud adoption model a customer may choose to implement."
Sheeran believes that helping CFOs make the right technology investment starts with identifying their preferred cloud delivery model and the associated implications.
Build or consume
According to Boorzin Hodiwalla, Hewlett-Packard Financial Services EMEA marketing and business development director, customers will take either a build or consume approach to the cloud services they adopt, both of which will have implications the CFO will need to evaluate. However, Hodiwalla also notes that most enterprises will look to build their own cloud infrastructure and operate in a private or hybrid environment for the foreseeable future.
"Moving to the cloud will be a journey with different on-ramps and use cases," said Hodiwalla. "Each journey will create unique paths that have various implications. However, regardless of what path is taken, CFOs and CIOs are focused on three core competencies that ultimately feed into the cloud decision they make: choice, confidence and consistency. For the CIO, having the choice to leverage open, heterogeneous or extensible environments is important.
The CFO really needs to have confidence in their underlying cloud infrastructure to ensure security risks are mitigated, costs are reduced and ultimately the business benefits achieved with cloud drive strategic value.
Finally, both want consistency in the architecture framework and consumption experience. By ensuring roadmaps are aligned, enterprises journeying to the cloud can be confident that their destination will ultimately be reached."
Security and investment concerns
Despite the ongoing publicity surrounding cloud, and its increasing numbers of proponents, HPFS is appreciative that there is still a certain degree of tentativeness among some CFOs. In particular, this relates to issues such as governance, risk and compliance, data and vendor security.
As a result, HPFS offered a global series of roundtable events to help CFOs better understand the financial implications, risks and benefits of cloud technology. In doing so, the company has been able to support clients as they evolve their business models to support their respective cloud journeys.
"The roundtable discussions are focused on IT from the CFO's perspective, in which we discuss the challenges associated with transformative technologies like cloud," said Sheeran. "This means working with the customer to identify and answer the right questions, while ensuring risks are being minimised and benefits maximised."
However, there is still some way to go in the overall move to cloud integration. As well as familiarising themselves with the intricacies of the latest front-line technologies, CFOs will need to work jointly with their CIOs to adopt a more longsighted and a proactive approach to IT investment decisions in order to engender healthy returns.
"Today's IT journey requires an ability to simultaneously scale technology assets, reduce TCO, increase ROI, enable competitive differentiation and drive business value," says Sheeran. "To achieve this, CFOs need to identify the various investment points associated with a long-term IT strategy.
"IT is a large line item in the CFO's budget and therefore always closely watched. They are also looking for ways to spend more on innovation and to help drive differentiation in the marketplace, which means they really need to have a long-term view of IT spending. By working with their CIO on a joint roadmap, the CFO will gain the visibility needed to identify the significant mileposts along that journey, and become more responsive to market conditions, competitive influences and financial factors"
Both Sheeran and Hodiwalla agree that the path ahead for many organisations can have several twists and turns.
"The journey to the cloud isn't a matter of just a few small steps, but a marathon stretching over many years, involving an untold number of operational and management decisions," said Hodiwalla. "Success increases dramatically when there is business and IT alignment. Core to this is ensuring the CFO understands the value IT can bring to the table."
Few of the transformative changes associated with cloud would be possible without the expertise of the CIO and IT. Defining how CIOs can effectively partner with the finance organisation to break down individually maintained silos of information and gain the enterprise-wide visibility, analytics and near-real-time reporting and performance metrics CFOs need, will become essential for driving business strategy and establishing global business leadership.
"CFOs are involved in many more areas of the businesses than ever before," Sheeran says. "They are constantly thinking about how to get the highest returns out of investments. HPFS can help them look at options for IT investments and then maximise this. Essentially we can help provide a differentiated experience for our customers by serving as the bridge between finance and technology."
"We can also provide a full suite of financial and asset management solutions to help with the transition businesses will go though on their journey to the cloud. This includes financial solutions to help reduce the risk or redundancy and safeguards against equipment becoming obsolete. With leasing solutions, customers can ensure they have the latest technology needed for their business requirements today and in the future."