When it comes to the decision whether to subscribe to a software-as-a-service (Saas) approach for certain IT functions, finance is where the buck should stop. Having data exist outside the organization can pose challenges to compliance, governance, and business intelligence — all areas where the CFO rules.
Software as a Service (SaaS) Definition and Solutions
Yet, with offerings like salesforce.com leading the charge, it’s becoming incredibly appealing for company departments that can’t get the attention of IT to “go rogue.” They do so by subscribing to an outside service without doing a lot of research first or consulting those with tech knowledge in the organization.
Financial veteran Richard Block said in our recent conversation that businesses that allow users to independently sign on to SaaS services, or any outside service for that matter, without input from IT could be doing great harm.
He argues that the data that will be scattered about in these cloud-based services could be used to improve decision-making within the organization, and that auditing and reporting will be impossible without direct control over data. For instance, if a sales team uses a SaaS to track sales commissions that information is then cut off from others in the organization and cannot easily be melded into analytics tools for enterprise-wide forecasting, budgeting and staffing decisions.
Yet, he concedes that there can be difficulty in getting IT to build out in-house systems in a timely fashion, to include necessary functionality. That’s where finance has to come in, thrust aside the argument that SaaS can be less expensive, and see the greater good offered by in-house access and integration of critical financial data.
SaaS companies would argue that this discussion is a non-starter, as many have ways to integrate the data with traditional ERP, CRM and other financial systems. However, IT still has to know that users are subscribing to these services — to grant access to back-end systems, and configure them properly for secure integration.
So perhaps the compromise lies, as Block says, in finance being a weigh station of sorts. That’s because it is most often the department that receives the requests to expense these services. Finance can discuss with IT the reason that departments feel a service is necessary, and it can explain the result that users are trying to achieve. Finance and IT together can then determine if the functionality can be found in-house. Finance might also have to take up the charge on behalf of departments to speed IT implementation based on need, thereby reducing the tendency of departments to go rogue.