ERP Project 101: Challenging ERP Requirements

I am not arrogant enough to believe that ERP software vendors are the guardians of best practices.  Nor do I blindly subscribe to the notion that the customer is always right.  What I do know and believe is that a good implementation partner will balance customer needs and wants with the fundamental value proposition of the ERP software to ensure customers have relevant information to make informed decisions.  The following blog posting will discuss some practical guidance that implementation partners can utilize to vet business requirements.

You must be given permission to challenge customer requirements

Regardless of your previous experience or how smart you think you are in order to be effective as an ERP implementation partner, you must be given permission by the customer to challenge their ERP requirements.  It is rare to receive this permission automatically but rather it must be earned by the implementation partner.  Following are core principles I use to earn that permission:

Vetting ERP Requirements

Earning the Right to Challenge Requirements

 

Knowing ERP functionality is simply not good enough.  A competent implementation partner is able to advise and influence their customers to draw the right conclusions and make informed decisions.  Next we will discuss how a good consultant guides the customer towards making an informed decision.

Lead by asking informed questions

In my early days of ERP consulting, I was taught to ask open-ended questions to prompt the customer to provide as much information as possible.  I agree with this approach as long as the information is value-add and guides the customer down the right path.  Too often I see ERP consultants mindlessly ask the customer 100+ ERP functional questions that focus more on “how” than “what” and “why”.  The following illustration provides key concepts that questions should drive customers to consider: 

Asking the Right Questions

Asking Informed Questions

 

Use questions to educate.  Use questions to persuade.  Questions should lead your customer to challenge assumptions and perceptions in their current environment.  A perceived requirement may be a limitation of the current system or organizational structure.  Just remember that asking the right questions is just the beginning to changing minds.

The best pressure is peer pressure

As a third-party external resource with limited knowledge of the customer’s business model, there are limitations implementation partners will have on generating customer ownership and adoption.  What consultants should do is facilitate and promote a process where relevant information is presented and evaluated.    Do not evaluate business requirements in functional silos but as part of the larger business process across all business stakeholders.  Visibility across the business process creates accountability – especially with peers within the customer’s organization.

Results of Business Requirements

Understanding the Impact of Business Requirements

 

The basic value proposition of ERP systems is providing the automation of best practices – that is common business practices – across a broad market/industry.  A direct contradiction against this key benefit is when a business requirement has to be addressed via a software customization.    Additional scrutiny listed above should be undertaken to validate the additional investment required.

Not challenging business requirements is a disservice to customers

A fundamental expectation that customers have for ERP solutions is to have a flexible and cost-effective business solution.  A key assumption required for cost-effectiveness is that ERP “out of the box” functionality addresses the majority of the customer’s business model.  Customizations have both a short-term and long-term impact on cost effectiveness.   I am not arrogant enough to state that ERP software addresses all the best practices a customer may be utilizing.  However, I have observed too many ERP implementation partners take the easy option of catering to user requests without leading the customer through a critical analysis to determine both the short-term and long-term implications of a specific customization. There are legitimate needs for customizations.  It is not an ERP implementation partner to prevent customizations but rather to ensure that customers have appropriate expectations and conclusions as a result of their implementation decisions.

Summary

In my humble opinion, good ERP implementation partners educate their customers in how to best utilize ERP software to support their business.  This not only requires ERP software knowledge and but more importantly requires the business acumen to understand current requirements and advise on future requirements.  Customers, if you are looking for an implementation partner that can act as a leader then you will have to pay a higher rate versus a staff augmentation partner.   ERP vendors play a very important role during an implementation - especially where it comes to best practices that are not delivered out of the box by the ERP software.  ERP vendors should provide multiple processes and examples of working with customers to influence software roadmaps and/or co-develop automated solutions.  Action speaks louder than words!  True partnership requires an investment from every player.

ERP Project 101: Organizational Fit Gap

I think we can all agree that organizational fit is a key consideration for successful ERP selections and implementations.  However, mention the phase “fit/gap” or “gap analysis” and most people will fixate on the ERP software.  There are several examples of functional/software fit-gap templates/activities but very few organizational fit-gap templates/guides.  The goal of this blog is to shed some light on this very important activity.

 What is an Organizational Fit/Gap?

An organizational fit/gap analysis is a comparison of the customer’s existing organizational model that supports the business to the defined organizational model supported (or assumed) by the ERP system.  Consider the following illustration: 

Org Gap Analysis

Organizational Fit Gap Analysis

If you do not know what is changing in the organization then how can you manage organizational change?  Too often I see ERP projects only focus on the “To Be” model and expect business users to figure out how to transition. I have also observed that customers see organizational change activities as an opportunity to reduce implementation costs by performing the activity themselves – regardless of their capabilities. 

In order to effectively conduct an organizational fit/gap analysis there are two key sources of information that are required: 

Information   Source Comments
Customer’s Organizational Structure and Business   Processes A   majority of peers and customers believe that this exercise is a non-value-add activity given the imminent organizational change that will occur as part of   the ERP implementation.
ERP Business Process Maps Consider   ERP business process maps as a demonstration by the ERP vendor to show how   their ERP software supports business processes.

Just as you perform a formal Fit/Gap analysis on ERP functionality you should also consider performing a formal organization Fit/Gap analysis as illustrated below:

Organizational Gap Analysis for ERP

Template to identify possible organizational changes based upon predefined ERP roles/responsibilities

An organizational fit/gap analysis should be performed during the ERP selection stage and refined during the early design stages of the ERP implementation.  Do not limit yourself to performing this exercise only once.  The analysis performed during an organizational Fit/Gap will drive future decisions and implementation activities.

What Activities should an Organizational Fit/Gap Influence?

The organization fit/gap analysis will have a direct impact on your organization change management plan and communication plan.  In addition, this analysis will provide insight into user security requirements.  Utilizing this approach will highlight how well the predefined ERP user security profile(s) align to the organization’s existing users.  As a general rule, the majority of predefined ERP workflows are based upon predefined user security roles; therefore keep in mind that ERP user security profile changes may require additional testing for related ERP workflows. 

Why Do We Need a Formal Organizational Fit/Gap?

Conducting a formal organizational fit/gap enables you to quantify the level of change.  Instead of taking a broad stroke at managing change you can provide a focused effort to accomplishing your objective. Remember that people are the most important component of a business solution.  Given the importance I believe that formalizing this activity is worth the investment.

Summary

Predefined ERP implementation tools, templates, roles can provide limited value to an implementation.  Too often the ERP market wrongly perceives that these predefined components result in faster implementations.  This misconception is most pronounced in the ERP SaaS/Cloud arena.  At the end of the day, an ERP implementation should only move as fast as the customer can handle the change.  Conducting a formal organizational fit/gap can enable the customer to adapt faster by focusing on the specific changes required for success.

SaaS ERP is not a push button solution

SaaS ERP is the latest effort in the ERP industry to provide a rapid, cost-effective solution for customers who want an enterprise solution.  A SaaS deployment model does provide the potential for greater value realization; however, the value proposition is dependent upon appropriate expectations and implementation approach.  The purpose of the following article is to provide insight to ensure customers make realistic and informed decisions.

General Expectations for SaaS ERP

I firmly believe that one of the key reasons for failed ERP implementations is that expectations were not correctly established and managed throughout the implementation.   Consider the following:

Common Expectations of SaaS ERP

Common Expectations of SaaS ERP

 

  1. Cheap:  The customer does not need to make a huge expenditure to implement and utilize.
  2. Fast: Answer a few questions and have an up and running software in weeks.
  3. Flexible:  Business users can make changes.  Minimize IT involvement.
  4. Intuitive:  Quick to learn and easy to navigate.

We can all agree that the above targets are worthy goals of any ERP solution.  However, this is only part of the story.   The next section discusses the efforts required to achieve the goals listed.

Desired Results of SaaS ERP

To better understand ERP SaaS expectations we need to elaborate on the desired results that should be realized by customers. 

Elaborating on SaaS ERP Expectations

Elaborating on SaaS ERP Expectations

 

Some of the desired results are directly addressed by the SaaS model but the majority of results are addressed either by (a) the ERP software architecture or (b) the delivery model.   Example:  SaaS ERP does not require an initial outlay of funding for capital expenditures for hardware and related infrastructure.  SaaS ERP eliminates the need for a separate effort for ERP software installation and certification.  Yet, it is important to remember that ERP software installation represents at most 5% of the total time required to implement an ERP solution.  Therefore the SaaS model by itself does not have a dramatic impact on accelerating ERP implementations.

SaaS ERP Realities

Allow me to share some observations I have regarding the ERP SaaS model that may not appear to be readily evident:

SaaS ERP Realities

Let’s take one of the above desired results to elaborate on the above diagram.  A goal for SaaS ERP is to reduce the Total Cost of Ownership (TCO).  One of the key ERP design strategies is to enable business users to tailor the functionality to meet requirements without having IT to make a costly customization.  However, it is important to understand the shift of effort from IT to functional users.  There may be a reduction in the effort or a change in the nature of the work but the effort is still required.  There is no “push button” to eliminate this work. 

For another example let’s take the ERP value stream.  ERP vendors can create additional value to customers by providing new and enhanced functionality.   The leading SaaS ERP delivery model should provide a 3:1 ratio increase in the software release cycle.   Yet, it is important to realize that more frequent ERP software releases require additional testing and deployment (organizational change) work.  It is interesting to note that many of the leading SaaS ERP vendors do provide an out-of-the-box testing automation solution.  Again, the customer will experience a shift from technical to functional effort.

 Summary

Sorry if I burst your bubble, but I rather have an informed customer that will have reasonable expectations versus a customer with unrealistic expectations.  SaaS ERP is one of many delivery models that ERP vendors offer to customers.  While it is true that SaaS ERP provide customers with new options not available previously, it is not a slam dunk for all customers.  Developing the customer’s use case and understanding all technical and organizational impacts will better ensure an informed decision is reached.

Cloud ERP Strategy: Goodbye IaaS, Hello IaaS

One of the first deployment models for cloud computing was Infrastructure as a Service (IaaS).  Currently, there is a price war between the major IaaS providers like AWS and Rackspace to provide the cheapest infrastructure. However, enterprise customers looking to move their ERP solutions to the cloud should focus more on Integration as a Service (IaaS).  Integration, not infrastructure, will have a greater impact to TCO and ERP success.    In the next sections we will briefly compare the influences that infrastructure and integration have on an enterprise solution like ERP.

Cloud Infrastructure versus Integration

In a previous blog I reviewed the key competencies to consider as part of selecting an ERP cloud provider (ERP Cloud: Finding the Right Provider).  Both infrastructure and integration are key considerations yet I view enterprise integration the greater challenge.  Consider the following:

Cloud Infrastructure & Integration

Key Cloud Consideration Factors

Cost

The cloud storage war appears to be getting the most press in cloud computing but consider two factors driving this type of pricing strategy

  1. Vendors cannot provide a material differentiation or competitive advantage.
  2. Technology improvements continue to drive down disk storage costs rapidly.  Combine this trend with the economy of scale that cloud providers generate to continue driving costs down by another 40% in the next 3 to 5 years.

Moore’s Law highlights the computing hardware trend resulting in greater technology capabilities and driving down MIPS costs.  However, the same cannot be said for integration.  As discussed in one of my earlier blogs (Best of Breed vs. Integrated ERP), integration costs can be up to 8 times the cost of the ERP software. 

ERP Integration Considerations

ERP Integration Considerations

We have all heard the proverb “A chain is only as strong as its weakest link.” Applying this concept to business software, we would conclude that a business solution is only as strong as its weakest integration.

Business Value Realization

Allow me to make the general statement that outsourcing IT infrastructure to a cloud provider should result in a cost savings to customers.  However, I believe that IT organizations will quickly learn that providing this cost savings is a short-term value proposition to their business owners.  Ultimately, IT-driven innovation will drive business value realization.  Gartner identifies Integrated Ecosystems and Hybrid IT & Cloud Computing as two of the top 10 strategic technologies for 2013.     Every ERP solution has a portfolio of edge products/3rd-party integrations to external solutions to provide holistic support of business processes.  The only true method of creating business value is through business processes.

Socialization & Collaboration

The ERP software industry is realizing that people have the greatest impact on business results.  It is refreshing to see the increase in socialization and collaboration capabilities.  Infrastructure is necessary but integration is the critical path to success.

Market Trends

In my opinion, I expect to see the market changing for IaaS providers.  Given how important integration is to a viable cloud solution either existing IaaS will grow into a Platform as a Service (PaaS) or will be acquired by PaaS vendors looking to provide global support.   Just take a look at AWS and Rackspace’s transition from an IaaS to a PaaS:

Summary

History always has a way of repeating itself.  Recalling the Y2K problem, storage (infrastructure) was seen as a strategic/limited resource.  This view resulted in the programming practice of representing the year with two digits and we all know how that came back to haunt IT organizations.   Infrastructure is a cheap commodity when compared to a collaborative, enterprise integration framework.  Infrastructure is a key enabler for cloud computing but integration will ultimately determine your success of ERP in the cloud.   

Building a Business-Aware Cloud Solution

In a recent study conducted by Forrester Consulting “Enterprise Cloud: Lessons Learned From Early Adopters” a key conclusion made is “A complete, application-centric, business-aware cloud solution is needed.”  Let’s say that your C-level executive stops by your office and asks you to lead a project to develop a business-aware cloud solution.  To be successful it is important to understand what you are building.  In the following blog I will attempt to define a business-aware cloud solution.

Defining a Business-Aware Cloud Solution

Your project objective is to develop a business-aware cloud solution.  As you are a competent project manager one of the first areas you want to define is the project scope.  As your humble project assistant, I have searched the internet for you and have leverage greater minds from the University of Edinburgh:

“What different employers mean when they talk about business awareness varies, however their views broadly fall into two areas: (1) understanding an occupation, and (2) understanding the business environment.”

What is Business-Awareness?

I would like to elaborate upon on this definition with the following model.

Defining Business-Awareness

Defining Business-Awareness

There are three key areas that enable business awareness. The business process area includes the business functions, related-activities, and the individual tasks that must be performed in order to generate the desired business results.  The business role(s) area includes the concatenation (grouping) of business activities into responsibilities that can be competently accomplished.  Finally, business awareness also requires an understanding how an industry operates and how it is influenced by local, national and global economics.

Now, your experience as a project manager tells you that a well-defined project scope statement not only explains the end result but also elaborates on what is considered out of scope.  With this best practice in mind let us clearly articulate on some areas that may misalign the focus on business.

 

Losing Focus on Business-Awareness

Blurring Focus on Business-Awareness

Please allow me to elaborate. A business function is a necessary structure resulting in a concatenation of activities/tasks that aligns with the skills/experiences of the organization to best support business processes.  The ERP software industry started as discrete, functional applications that continue to evolve into enterprise-wide, business process solutions.  In general, software applications focus more on business functions requiring the implementation of multiple applications to support an entire business process.  As a veteran project manager, you understand that an application focus may result in gold-plating or poor support of functional hand-offs (integration).  You also appreciate that technology is only one component of a business solution.

We are halfway to having a better understanding of our project objective.  Now, let’s focus on what some may consider the mystical realm of the cloud.

What is a Cloud Solution?

Forgive my “tongue-in-cheek” response above but it is hard to define a clear picture given the varied information available in the marketplace.  Once again, I refer to brighter minds (NIST) to provide a definition.

Cloud computing is a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction.”

I would like to focus on what’s not in this definition that may be perceived expectations of moving business software to the cloud

Implied Expectations for Cloud

Implied Expectations for Cloud

The immediate, short-term savings will be reduction in capital expenditures required for IT infrastructure requirements. As correctly pointed out in the book “Cloud Computing – Assessing the Risks“, there is a general misnomer that there is a risk reduction with the cloud.  There is a transference of risk from the IT organization to the Cloud Provider.  Technology results (reliability, response, availability, scalability)  may lead to business benefits – but it is not a guarantee. 

Now that we have a little better understanding of project objective, let’s briefly review the role that the key enablers will play in the implementation of a business-aware cloud solution.

Enablers for a Business-Aware Cloud Solution

As a competent project manager, you know that the project must address all three components of a solution in order to be successful in meeting all expectations.  For the sake of brevity we will only focus on a key expectation for each component.

ERP Business Solution

Business Solution Defined

  • People:  People innovate.  People accept.  People resist.  People ultimately drive project success. 
  • Process: Innovation is a process and not just a brainstorming event.  IT needs to move up the business value chain with a rapid, iterative delivery method.  Governance is not an acceptable substitute for properly educating users on the effective use of cloud technology.
  • Technology: A reasonable expectation is to select a cloud vendor that provides a  reliable, secure, scalable IT infrastructure solution on par (or better) than existing services.   For business software like ERP to be business-aware, the software must have access to business model, roles, and rule metadata that is maintained by business users.

Summary – Are We There Yet?

Do all the technical components exist in the marketplace today to build a business-aware cloud solution?  Technically speaking, the answer is yes if you want to seamlessly integrate multiple technical components with multiple UI experiences, data sources, and training requirements.  Will it be a practical and viable solution?  I suspect that there is room for improvement.  If you wait for a complete solution then it may be too late for your business users.  But you are not just a project manager, you are a project leader!  You know that this effort is a project program with iterative projects that incrementally build upon the individual project results.  Start planning, start delivering!

P.S.  I am conducting a webinar: Best Practices for Selecting the Right ERP Cloud Provider on Wednesday, December 12, 2012 1:00 PM – 2:00 PM EDT

Overview – Next stop: The Cloud! Everyone is talking about it but there is a fog of disjointed information out there regarding moving to the Cloud. In this webinar we will demystify the cloud and discuss one of the key activities customers should carefully consider in moving to the cloud – selecting the right cloud provider. We will also discuss some of the key factors to consider as part of your cloud deployment strategy. Register at http://www.oracle.com/go/?&Src=7604459&Act=251&pcode=WWPN12035291MPP257 .

Is Cloud Ringing the Death Toll for ERP?

Cloud computing is here to stay, but what does that mean for those who sell and implement ERP solutions today?

First, it means that there is a new way in which business software solutions are being purchased and consumed, and that means resellers need to pay close attention to the way they run their business. Secondly, it means that if ERP companies wish to remain in the game, they need to make some significant changes.

Cloud on its own doesn’t affect the validity of ERP. Businesses still require management software to help them run their organization effectively. What Cloud does do however, is level the playing field and make ERP solutions more accessible to the consumer. That means publishers and resellers need to pay attention.

New Cloud companies are popping up every day, and while laggards scramble to bring their on-premise solutions to the Cloud, these born in the Cloud players are discovering faster, easier, and less expensive ways to deliver ERP. Complex, highly customized and bulky solutions which come with a hefty price tag and a collection of features and functionality not required by the end-user are quickly being replaced by pay as you go solutions. Customer expectations are also changing; soon no one will be willing to accept that ERP requires a huge capital expenditure and lifelong commitment without first researching alternatives in the cloud.

 

Cloud ERP Product Cycle

Product Lifecycle for Cloud ERP Offering

 

While Cloud ERP is still an emerging market, it is fair to say that we’re moving beyond the early adopter stage. We’ve crossed the chasm, and are quickly headed towards the early majority market. Within the next 2 years we can expect to see a majority of ERP purchases made in the cloud.  In our opinion, Cloud ERP will not be an initial threat to a vendor’s existing up-market ERP customer base.  This market is highly saturated (+90%) and today we do not see a compelling value proposition for large customers to move completely to the Cloud.  We do see opportunities where Fortune 500 ERP customers may be interested in implementing edge software products in the cloud (ex. travel & expense, self-service, tax calculation and compliance, etc) as part of a hybrid deployment model.  Where we do see a threat/challenge to on-premise ERP is in the SMB arena – especially for new customers.  This market continues to be a strategic growth area for ERP and customers have a greater flexibility to leverage a SaaS or Cloud model.

The Fate of ERP

While it doesn’t appear that the fate of on-premise ERP solutions is entirely bleak, there will certainly be a marked shift towards Cloud based ones. In fact, the resellers can already feel this happening.  There are fewer people out there looking for business management systems in general, and in a time of economic uncertainty and tight budgets, the appeal of an operating expense and a per-seat price is more than appealing. Customers are becoming more likely to change their processes to align with the functions of a less expensive Cloud based solution, than to go through the process of building one which is fully customized. What’s more, people are less likely to pay the large price tag most often associated with ERP services, instead preferring a solution in which they can turn off functions (thus reducing costs) at their leisure. 

So no, Cloud isn’t exactly ringing the death toll for ERP solutions, but it is changing them. ERP will always be required by many types of organizations, but on-premise ERP may in fact not survive this shift long-term. If traditional ERP companies hope to survive the transition they need to be proactive about developing their Cloud solutions, and that means more than throwing up a landing page and calling yourself a Cloud player.

So what do you do?

If you’re an on-premise ERP reseller with no Cloud transition plan, you better get started. That means developing a team to strategize taking your solution to the cloud, putting the necessary resources behind it, and understanding why some customers have an inherent fear of the Cloud. If you’re already developing your Cloud solution, then keep at it and make sure you’re not just focusing on the solution, but on the marketing and sales as well. And if you’re already well entrenched with an ERP solution in the Cloud, then you should get ready to defend your competitive position because you won’t be alone for long.

ERP Deployment Types

ERP Deployment Types

 

Additionally, if you’re a company seeking out a new ERP system, you should carefully consider the benefits of using a Cloud solution. While we’re only entering the early majority market, Cloud computing is the wave of the future. As consumption models go, Cloud works for a majority of businesses today, and the list continues to grow. If you’re looking to move some of your capital expenses into operating expenses, and looking for a better way to manage your business, ERP in the Cloud might just be for you.

Guest blog by Jason Carroll with contributions from Brett Beaubouef

Jason is an industry analyst for Software ThinkTank.  Software ThinkTank is an online resource that helps businesses keep up-to-date with the latest trends, technology innovations and business solutions through a range of articles, case studies, guides and tools. Visit SoftwareThinkTank.com for more information.

SI Partner for PeopleSoft ERP

Blog Sponsor – Cardinal Point Solutions, LLC.

Cloud Can Bring Out the Best of ERP

Previously, I discussed some of the hard realities customers have to manage as part of a Cloud ERP solution.  However, these challenges should not deter customers from looking at a Cloud ERP deployment model.  There are broad advantages for Cloud ERP including incremental scalability and smaller start-up investment.  I would like to speak to some of the less known advantages that a cloud model can provide to ERP customers.

ERP Value Proposition Revisited

In a previous blog article (ERP Makes for an Expensive Custom Solution); I outlined the key advantages and challenges associated with ERP software.

ERP Pros and Cons

ERP Advantages and Challenges

 

For a successful ERP implementation, it is vital that the approach address both the inherent advantages and challenges.  The right cloud deployment model can address many of the ERP advantages/challenges in a more effective manner than a traditional On-Premise model. 

How Cloud Can Make ERP Value a Reality

Let’s briefly discuss how a Cloud ERP model can have an advantage over an On-Premise ERP model using the inherent ERP advantages and challenges as the context for the comparison.

How Cloud can support ERP Advantages

Cloud ERP vs On Premise ERP

Let’s discuss some of the less obvious advantages in more detail:

  • Standardization:  Cloud ERP will have an advantage over an On Premise model simply because the costs tend to be more visible to business users.  Traditional internal IT organizations in general do not have a service-oriented price model for their internal customers.  The cost of not standardizing business processes gets lost in the general IT overhead allocated back to internal businesses.
  • Share IT Development Costs:  as far as short-term capital expenditures and scalability costs, I can see where Cloud ERP has a definite advantage.  Longer-term or Total Cost of Ownership may swing the advantage to an On Premise model given factors like (a) customer size and (b) level of software customization required.

Next, let’s review a comparison between Cloud ERP model and On-Premise model on which model can better address inherent ERP challenges.

Cloud vs On Premise ERP Challenges

Cloud vs On Premise ERP Challenges

Let’s discuss some of the less obvious challenges in more detail:

  • Organizational change:  When you own the change the more likely you are to accept the change.  Even though there may be a divide between business users and an internal IT organization, they are both part of the overall organization.   A rapid deployment of functionality does not necessarily mean a rapid user acceptance and effective use of technology.
  • Requirements gathering:  Requirements gathering and business analysis is a gap that most ERP Cloud providers have not addressed effectively.  Onsite, face-to-face interactions is still the most efficient means of gathering and validating business requirements.

 Regardless of the advantages that Cloud ERP may have over an On Premise ERP model, a customer with unrealistic expectations for Cloud ERP will result in a disappointing experience.

 Beware Of Unrealistic ERP Cloud Expectations

Cloud ERP is an evolving solution model with as many misconceptions as hype.  In fact, many have labeled these misconceptions as cloud washing.  Following are common perceptions and misconceptions that customers may have with Cloud ERP offerings:

  1. Huge cost savings:  This can be a huge misconception if customers expect to run on the latest/greatest/fastest possible hardware.
  2. Quick solutionsThere can be a perception of a real-time, on-demand value generation for customers.  It is important to remember that Cloud ERP is only one component of a business solution.
  3. Greater collaboration: Cloud ERP or any technology does not automatically result in greater interconnection between people, departments, and companies.

Be careful of expectations that go far and beyond what the cloud is actually capable of providing.  Customers may want everything automated without having the discipline and effort to utilize technology appropriately.   As the saying goes “You can’t have your cake and eat it too!”

Summary

Cloud ERP is a maturing deployment model that may provide a greater opportunity to capitalize on an ERP investment.  A Cloud ERP model encourages standardization through visible economic drivers and provides the opportunity for greater focus on strategic activities. However, we need to balance our enthusiasm for Cloud ERP with realistic expectations.  There is no such thing as a push button solution. 

SI Partner for PeopleSoft ERP

Blog Sponsor – Cardinal Point Solutions, LLC.

Follow

Get every new post delivered to your Inbox.

Join 4,411 other followers

%d bloggers like this: