Real-world benefits of moving to the cloud
In my experience, Enterprise resource planning (ERP) applications will benefit as much, if not more, from the cloud as any other enterprise workflow or system. But why?
Benefits of the cloud: The big picture
The cloud helps organizations boost their scalability, continuity, security, manageability. And I’ve seen first hand the huge cost benefits that come from these improvements.
However, I’ve also noticed that many organizations lag behind in using the cloud for their back-office functions. Meaning that by not keeping these systems in line with their other forward-facing parts of the business, they miss out on many of the biggest benefits the cloud can offer their business.
Fact or fiction?
But to truly highlight these benefits, we needed to base our findings on more than opinions or experience. So we worked with Computing research to survey 150 people involved in cloud strategy and implementation at their organizations to discover the real-world benefits of a cloud ERP and how you can get them.
In this blog, I’m going to reveal some of the key findings from our research. Looking primarily at where businesses are up to in their ERP cloud migration journeys. We’ll also explore why other organizations keep their ERP operations on-premise and what they may be missing out on.
And I’ll cut through the rhetoric and assumptions to give you real-life experiences that get to the bottom of the question, "Should your ERP be on the cloud today?”
Here's what we found.
Where are we?
The first question I wanted to ask was to help set the scene of what is happening out there.
To know who is benefiting, we needed to know at what stage our 150 organizations were in their ERP cloud migration journeys. And where did they expect to be two years from now?
Interestingly, only 16% of organizations have fully migrated their ERPs to the cloud so far. Though 39% are in the process of rolling out cloud-based deployments, with 10% incubating or trialing, and another 19% in the planning stages.
We also found that in just two years, almost half of these organizations plan to have fully implemented their ERP to the cloud, with most of the remainder not far behind.
This leaves 16% with no current plans – though most are interested in migrating. The big question this raises for me is, where does this leave these outliers once cloud-based ERP becomes near universal if they don't begin their journeys soon?
Cloud or …?
We also wanted to know where people are hosting their ERP applications if they’re not in the cloud??
For most organizations, cloud-based solutions, across public and private clouds and SaaS solutions are now in the majority. Interestingly, this is particularly the case across ERPs for HR, Customer relationship management, and helpdesks.
However, our study found that many areas with direct commercial links like accounting, risk management and compliance, procurement, supply chain management, and finance are lagging behind.
What's the benefit of cloud-based ERPs, really?
Our research then dug into the real-world benefits and experiences these organizations were having with cloud ERPs. Looking directly at the benefits those that have either 'fully implemented' or are 'rolling-out' cloud-based ERP are seeing.
I was fascinated to find that ‘Easier remote working’ leads the way, with an average score of 7.7 out of 10. Which, for me, makes a lot of sense in the context of 2020 so far with social distancing and lockdowns. The cloud simply lets people do their jobs anywhere, anytime.
The other significant benefit we found was the cloud's 'Ease of scaling.' I believe this is primarily due to the cloud's ability to let organizations scale up and down almost instantly, without the hassle of rethinking business processes and services.
Responses also mentioned other traditional cloud benefits such as increased productivity, ability to adapt quickly, reduced operating costs, easy updates to the latest innovations, and better user experience.
Expectation vs. reality
This research has shown me that the other major thing we need to consider then is, yes, there are benefits but are they worth the investment? Does the reality of cloud ERP live up to expectations?
On average, organizations were satisfied, with over half giving a response of 7 and above. And just 15% scoring 4 and below.
However, we’re still looking at a market in transition, with many still planning to move to the cloud from existing on-premise solutions. For this will be where things become more challenging, because, for many, these solutions have done the job just fine until now, but are now beginning to hold them back.
So surely now it must become a question of 'when,' not 'if' they will migrate their ERPs to the cloud.