The ever-increasing need for businesses to cut costs, coupled with booming cloud technologies and BYOD, are driving enterprise resource planning (ERP) vendors to move their solutions to the cloud.
According to Alan Sher, director at HansaWorld SA, cloud computing now has a profound impact on the entire IT industry as a new business model. The rapid development of cloud computing can help enterprises access high-performance IT services with lower cost, says Sher.
There is no longer any need for substantial capital expenditure and the associated operational costs of maintenance and support of on-site systems, he adds.
Businesses can simply procure and provision a server from, for example, Amazon Web Services rather than buying a physical one and, as a result, it is far more affordable for any company to implement ERP, says Sher. "Vendors and resellers can now spend less time quoting on hardware and can instead focus on the ERP software and its configuration, making deployment timeframes much shorter."
He points out cloud computing is making fully-functional ERP systems fall within reach of far more businesses than before - SMEs can now access high-performance IT services much like large enterprises do.
For a low fee, SMEs now have access to systems and processes which once belonged only to large businesses with large bank accounts, says Sher. "The business owners have access to concepts and processes used in bigger companies, providing a personal growth path which better equips the entrepreneur to become a 'big business' owner and operator."
However, there is a potential down side; constant access to company data adds to the digital fascination which seems to have overtaken the population in general - it can be very distracting to have such ready access to company information at all times, says Sher.
He believes ERP vendors that are not adopting cloud might lose market share. The problem some vendors have is their systems are not designed for the cloud and may require complete rewriting of systems, and this comes at a major cost and risk, says Sher.
"If your system was designed for on-site deployment, it typically 'expects' a LAN or WAN to provide the bandwidth to exchange data. The Internet, while improving rapidly, still has constraints and, perhaps obviously, the lower the bandwidth requirement, the better the application will run," says Sher.
Sher notes, however, any business today, especially among 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.