ERP and the cloud
Whether it’s a groan, a shudder or a deep feeling of dread, reacting negatively when your enterprise resource planning (ERP) supplier announces a “transformational upgrade” is normal. And once the news is out, you can only ignore it or pretend you didn’t hear it for so long. At some point, you need to do something.
A common place to start is with some basic research to help you cut through the inevitable marketing hype, distinguish reality from spin, and figure out what is actually useful to your business from the long list of claimed benefits.
Experience tells us that what you’ll discover is a bit of a mixed bag. Some items will reflect the ERP supplier’s own agenda – squeezing out the competition, making it harder for you to switch suppliers, and, of course, creating innovative new ways to extract more money from you.
At the other extreme, you’ll find genuine efforts by the supplier to help you help yourself and your business – eliminating legacy customisations, simplifying your environment, and generally enabling you to work smarter and deliver a better service to users.
Planning for the future, or forced forwards?
More perplexing is often the stuff in the middle. This is particularly true when it relates to things you’ll probably have to address at some point, but hadn’t planned to spend time on right now. Examples here might be real-time analytics, artificial intelligence (AI) and machine learning, internet of things (IoT) and other things we might put into the “leading edge” category.
The trouble is that the ERP suppliers often position the latest transformational upgrade as a prerequisite for unlocking all of the additional goodness. And if you say you’re not interested in all of the new capabilities on offer, or maybe just one or two of them, the answer they give is that you’ll be laying the right foundations for the future.
There’s nothing fundamentally wrong with this argument, but when you’re already pretty busy and looking at project and change-request backlogs, the short-term pain-to-gain ratio can’t just be dismissed. And the feeling of being pressured into following the supplier’s agenda becomes even greater when a stick accompanies the carrot, for example a threat to withdraw support if you don’t upgrade by a certain deadline.
But succumbing to negative sentiment doesn’t actually help – so what do you do?
Whatever the suppliers may say, you always have choices
Well, the first thing to appreciate is that a lot of what you hear from ERP suppliers is simply designed to create a sense of urgency to stimulate commercial activity and/or drive a higher level of customer commitment. At the end of the day, though, it is largely just marketing. If enough customers push back, experience shows that deadlines quietly recede and the hard lines become progressively softer.
The other big thing to appreciate is that you have choices, which means that whatever the ERP supplier does or says, there is almost never a need to relinquish control of your agenda. It’s your business, it’s your system, and you should be calling the shots.
With this spirit in mind, a route we are seeing more ERP customers go down is migration of at least some of their existing landscape into the public cloud. Although not a trivial exercise, it’s often a lot less costly, risky and disruptive than implementing a huge architectural shift within your on-prem environment.
Once you’re running in AWS, GCP, Azure or some other certified cloud, you’ll then find a whole world of complementary solutions suddenly opens up to you. Integrating with innovative and well-proven third-party platforms in areas such as AI, analytics and IoT platforms is a lot easier when everything is running in close proximity and managed through a harmonised set of frameworks and controls.
And the bonus is that much of what you’ll discover will be more powerful, flexible and/or well-established than the ERP supplier’s integrated functionality.
The real cloud win is often flexibility
The overriding advantage, however, is that you can move at your own pace and select options that represent the best fit to your requirements. If your needs are modest in a particular area, you can go for a lighter-weight solution than the ERP supplier’s integrated functionality. If you have special or more demanding needs in other areas, you might look for a higher-end solution or maybe something more tuned to your industry.
And none of this means that you can’t move to the ERP supplier’s new architecture at some point in the future, just that you can do it at a time that best suits you.
This stepwise cloud-centric approach may not be right for every business. Indeed, we come across many ERP customers who welcome the latest big releases with open arms. But it’s certainly a legitimate way forward, and one that many implementation partners in the ERP ecosystems now support.