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Clouds in the Forecast

Finance departments will invest heavily in cloud computing and mobile technologies in the coming year.

“Rolling out mobile devices needs some due diligence first,” he says. “Questions need to be asked: Where’s the data? Who’s securing it? How is it secured? What mobile device management regimes need to be put in place?”

Mobile-device use will also raise significant regulatory and compliance issues, depending on where a company operates, Livingstone says. The European Union, Australia and other countries and international organizations are passing data-security laws and creating regulations that will be effective in 2014. These will require companies to safeguard private data, including names, addresses, phone numbers and other information that could be used for identity theft.

Part of a CFO’s due diligence will be to ensure that a cloud service provider complies with current and future cloud privacy legislation, as well as regulatory requirements to keep data and backup data within certain countries, Livingstone says.

Privacy issues will be another area of responsibility for finance chiefs as their companies utilize sophisticated mobile device technology, such as tracking user location, says Jack Bergstrand, chief executive of management consultant Brand Velocity and a former CFO and CIO of publicly traded companies. Because CFOs are seen as keepers of common sense, they will be in the perfect independent position to ask the right questions about the technology’s use, advantages and risks.

“There’s no doubt that mobile devices are continuing to become the center of the user-interface universe,” Bergstrand says. “But I do think companies will need to be conscious of customer privacy issues. With mobile that is even more important than it was in the old days.”

When it comes to the trend toward increasing employee use of mobile devices in the workplace, among the first steps for a finance chief will be to assign value to the devices and determine how much employees will be willing to pay for them, says Bergstrand.

Many organizations are currently buying mobile devices for employees, but often it’s not a coordinated effort, making costs higher than they need to be. Finance chiefs will have to reverse the current trends of company units buying tablets, smartphones and hybrid mobile devices with their discretionary budgets and employees logging on to the network infrastructure without the knowledge of the CIO, Lovelock says.

“Reactions to people bringing their own mobile devices to work have been tentative,” Lovelock says. “Most CFOs haven’t said, ‘The value of the phones to this organization is based on this premise’ or ‘This is how we will fund employees that need to have cell phones.’”

It is difficult and costly for companies to separate the business versus personal costs of mobile devices used part of the time for work, but more tools will be on the market in 2014 to make the process easier.

Company spending on mobile devices is predicted to increase in 2014, but not as much as in 2012, prior to the BYOD (bring your own device) trend, Lovelock says. “We know companies are spending less on phones because they are apportioning part of the cost to employees, and in some cases the entire cost.”


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