The survey results are out – we had over 200 respondents and some very interesting results!

Have a look here.

The Irish Internet Association’s working group on Cloud Computing has just published a market research survey which we would be grateful if members of this group could respond to.

This market research is really valuable to understand if Ireland is lagging in cloud computing adoption or not, whether it’s potential is living up to its promise and identifying what exactly are the barriers to greater adoption.

We thank you for responding to this survey which will help us to help Irish businesses benefit from the cloud. All respondents will receive a complimentary copy of our Whitepaper (working title: Why Ireland’s not Cloud Computing?) which is being written in collaboration with all the major cloud vendors (Google, IBM, Microsoft, Salesforce, etc.) and some major Irish enterprises.

If you have any questions about the group’s objectives, please do not hesitate to contact me at gpower@sysco.ie.

With the advent of the economic downturn, the daily press is awash with colourful narratives in relation to the pecuniary adventures of various employees (both private sector and State) who sallied forth during the salad days, corporate visa card in hand, and spent company money like it was going out of fashion.Some truly hair raising faux James Bond adventures  have been documented, involving private jets, exotic locations and palatial hotels where the pay-per-view and mini-bar rolled all night long.

It is somewhat disheartening to think that  incidents such as those which are now coming to light were allowed to occur in these organisations, somehow evading the combined attention of the responsible budget holder as well as internal and external compliance checks.

It seems that largesse was not only justified by claimants who felt they were “worth it”, but the excesses were either conveniently ignored or tolerated at the responsible approver level also.

From a systems perspective, one can implement controls to manage the expenses process which
- prevent claims being raised by unauthorised persons or on behalf of unauthorised persons
- prevent claims being raised outside of ones area of budget responsibility
- can enforce multiple levels of approval depending on the materiality of the claim involved
- have upper limits on the amounts claimable
- include business logic to enforce corporate policy in relation to expenses claims
- provide a complete and secure electronic audit trail of expense claims and the related sign offs

However, such a system must also be accompanied by a culture where all such corporate expenditure is subjected to rigorous and impartial review by the appropriate authority. Perhaps now that the bubble has burst, shareholders and the taxpayer can expect those appointed on their behalf to manage corporate and State organisations to cast a more critical eye at the expenses of employees.

Flexibility & Freedom

• SaaS applications can be accessed anywhere from any PC
• Less need for any internal IT management
• Security is actually stronger than on-premise, particularly for small businesses
• You can trial solution before buying
• You can go live rapidly since the standard application is already available
• In the multitenant model, you are always on current software versions since upgrades are forced

Better bottom line

• The upfront cost is radically reduced (e.g.  no hardware costs)
• System management costs can be reduced
• A fixed capital cost becomes a variable expense
• Commitment is low since you pay month by month
• You pay for what you want (SaaS’ variable pricing means user numbers can change month by month)

But the Bad Bottom line

• Over time, renting is more expensive
• It is a continuous monthly expense
• You do not own an IT asset

The Whitepaper started by adopting an independent third party working definition from the American National Institute of Standards and Technology.

The IIA Working Group have used the definitions of IaaS, PaaS & SaaS which are from this community.

http://csrc.nist.gov/groups/SNS/cloud-computing/

Since cloud computing is essentially based on a model of `shared resources on demand’,  this architecture challenges heavy transactional enterprise systems which have to `share’ I/O paths and storage infrastructure. 

In other words, customers of the cloud not only need to worry about their own applications contending with each other but also contention between their applications and a myriad of other companies’  applications which will be sharing the same storage infrastructure.

There is a similar concern for intra node communications, which are vital if enterprises wish to provide a highly available clustered environment.

Guaranteed I/O performance (or at least guarantees that they would not be contending with other companies’ applications) are critical for enterprises considering deploying of their systems in the cloud but cloud vendors typically do not provide guidelines for I/O much less guarantees.

Why? Because “shared resources on demand” means they can’t.

Is this a Catch 22 for enterprise adoption? How will cloud vendors  grapple with the challenges this shared   storage model creates for heavy transactional enterprise systems?

Stay tuned for the vendor’s response…..

Most credit professionals fail to recognise that customer bankruptcy can be predicted. Bankruptcy is an extremely devastating experience not only for the owners and employees of the bankrupt company, but also for the credit professionals that extended terms to that business.

Both bankruptcy and severely slow payments can be identified through the use of credit and customer scoring.

A business failure or slow payments can happen for a wide variety of reasons, but what we really need to know is how to predict a majority of bankruptcy filings. Statistically valid predictive scores can assist you to uncover the risk within your portfolio. Scoring is used extensively in the consumer market, and many credit professionals in the commercial segment should take advantage to more clearly identify their higher risk accounts.

Look at Credit Management Software that gives you functionality to credit score your customers. Based upon this information the system will have the future looking scores, which will be designed to predict both the potential for financial stress and severe payment delinquency. These statistically valid predictive scores incorporate multiple data sets and can be even more predictive when it comes to bankruptcy.

By using credit scoring it will clearly identify your lower and high-risk accounts by segmenting your portfolio and making it much easier to better concentrate limited resources.

By giving all your customers some type of ranking system with a credit score, you will more easily identify and prioritise the accounts requiring more or less aggressive collection techniques. Allign your most experienced credit controllers with the highest risk accounts, change contract terms if needed or even exit a relationship where appropriate.

With the efficiency gains that will be realized, you can then spend more time with marginal accounts. By using scores and portfolio analysis techniques, credit professionals can assure a more consistent and systematic approach to receivables management.

It stands to reason that a business that fully embraces cloud computing – particularly for critical applications that cannot fail – must have guaranteed broadband access to the cloud. The fact is internet connectivity options are limited in Ireland and wireless which is more accessible can be unreliable.

The issue for Ireland is not just that we are lagging far behind the broadband penetration targets that the government set itself but the high cost of guaranteeing this access.

The cost of SLAs from ISPs guaranteeing 99.9% uptime come at huge cost and this cost contributes to the total cost a business must incur to migrate its critical applications to the cloud.

Until Irish ISPs can guarantee Irish businesses reliable uptime at a reasonable price, the cost benefits that cloud computing promises cannot be fully realised. This is a huge inhibiting factor to adoption and one that much be esclated to government to resolve.

Yesterday, the Irish Internet Association’s Working Group on Cloud Computing was formally kicked off as we began our task to  publish a whitepaper by the end of September. The meeting was well attended with all the major cloud vendors (Google, Microsoft, IBM, Salesforce, etc.) outnumbered by industry representatives (elan, Kepak, Friend’s First, Merrill Lynch, etc.).

The first hurdle was easily cleared when the NIST definition (http://csrc.nist.gov/groups/SNS/cloud-computing/index.html) was unanimously adopted.

The second hurdle – the scope of the whitepaper – proved a little more contentious when Google’s figures contradicted Microsoft’s on Ireland’s enterpise adoption of cloud applications. Google’s figures showed Ireland to be well ahead of its European counterparts while Microsoft’s showed Ireland to be lagging.

After much debate, agreement was finally reached that cloud computing needs to be categorised into simple and complex applications since there are obviously many more obstacles to the adoption of complex applications so they need to treated differently.

The fact is real obstacles exist so this is the task we have set ourselves to either resolve the perception of these obstacles or propose recommendations to counter them in the hope that our whitepaper will encourage Irish enterprises to get on the cloud.

For everyone involved in one way or another with Credit Management these are busy and tense times. Credit management is at the centre of interest and many companies have assigned the highest priority to credit management and the role it plays in effective working capital management. The current economic climate also presents us with opportunities; we now have the opportunity to show how vitally important a well managed credit management process is to corporate success. 

 Many companies, from all sectors and all sizes, are looking for support for their credit management processes; they are looking at credit management software solutions that are well proven. The urgency to invest now seems to be a common trend. The market is telling us: to do nothing is not an option.

Many say that the worst is still to come but the positive spirit with which our industry leaders view the future is very positive. Credit management is at the centre of corporate interest and offers us all many opportunities.

Ask yourself the following:

Do I want to make my company’s credit approval and credit management processes more efficient, more effective and more customer oriented?

 Do I want Information from customer relations and credit risk management at hand, helping improve my communication with my customers?

 Do I want to be more proactive with my credit management or am I happy to deal with credit management in a reactive way?

 Do I want to improve my company’s cash flow?

 In today’s business environment managing risk and improving cash flow are more challenging then ever:

•  Bankruptcy rates rising, the risk of incurring substantial losses are greater than ever
• With the economic downturn and business practices are causing companies to pay slower, there is greater urgency on increasing cash flow

 In response to these trends we all find that as credit professionals we are unfortunately becoming more reactive as opposed to being proactive.

 We ask ourselves “Is Credit Management Software the answer”?

 First of all, a well-documented best practice involves leveraging credit management software, often coupled with scoring, to improve cash flow through faster response times and more consistent decisions. Credit Management Software also allows you to better partition your portfolio making it easier to see risk patterns as well as manage your franchise. Again, the common theme is to proactively identify those accounts that need your attention and use software to handle repetitive tasks.

Unfortunately, many credit professionals do not take full advantage of technology. Credit professionals need to create greater system efficiencies to compensate for corporate cost cutting goals. That requires embracing technology in one form or another.

Sidestepping common pitfalls provides a framework for becoming more efficient and increasing cash flow. Once you recognize an opportunity, you then need to assemble the required resources to effectuate a solution. Until you take steps at becoming more efficient, you will in fact be whittling away at your limited resources.

So ask yourself again, “Is Credit Management Software the answer?”