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Cloud drives ERP efficiencies

Regina Pazvakavambwa
By Regina Pazvakavambwa, ITWeb portals journalist.
Johannesburg, 16 Apr 2015
In time, monolithic ERP suites will give way to more agile deployments, says Sage ERP's Jeremy Waterman.
In time, monolithic ERP suites will give way to more agile deployments, says Sage ERP's Jeremy Waterman.

The enterprise resource planning (ERP) market is changing at a rapid pace as hybrid and cloud-based architectures bring new levels of efficiency, affordability and flexibility to the enterprise applications market.

This is according to Jeremy Waterman, MD of Sage ERP Africa and Middle East, who notes the advent of cloud computing is disrupting the ERP market.

Cloud is changing the business models of ERP vendors with businesses demanding easy-to-implement and easy-to-run solutions, says Waterman.

Organisations are embracing cloud because traditional ERP systems are not designed for the needs of a modern workforce, which is mobile and geographically dispersed, and often takes the form of an extended enterprise embracing partners and contractors, says Waterman.

The cloud is enabling employees to gain secure access to business systems wherever they are, with a frictionless user experience - helping companies mobilise business processes and in the process, becoming more efficient and responsive.

"Companies that want to remain competitive have no choice but to modernise their systems so that they're better aligned with the pace and connected nature of the digital world. In time, monolithic ERP suites will give way to more agile deployments."

While traditional ERP suites won't completely disappear, we'll see hybrid deployments that blend cloud apps and connected services, with modular on-premises applications starting to predominate, adds Waterman.

Those involved in managing enterprise operations and improving corporate ERP systems in organisations need to increasingly assess the effects and impact of cloud computing, says Waterman.

According to a PwC study, CIOs are rethinking their approach to ERP, due to modular, cloud-based business applications that offer viable alternatives to the inflexible and expensive systems that have long dominated the sector.

PwC advises that as with every major IT transformation, companies must create a full business case in which they carefully weigh the benefits and challenges of these new systems, to realise the true business value.

Alan Sher, director at HansaWorld SA, says cloud computing is making it possible for more businesses to have fully functional ERP systems within their reach than ever before.

There is no longer any need for substantial capital expenditure and the associated operational costs of maintenance and support of on-site systems, says Sher.

However, cloud ERP could negatively impact big ERP vendors - they could start losing market share in the face of systems which are more affordable, faster to deploy, easier to maintain and more flexible to meet changing business requirements.

"Any business today, especially those considering ERP for the first time, which doesn't at least examine a cloud solution as a potential option, is doing itself a major disservice."

ERP vendors that are not adopting the cloud might start losing market share in the face of systems which are more affordable, faster to deploy, easier to maintain and more flexible to meet changing business requirements, says Sher.

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