Why It's The Right Time To Migrate To A Cloud ERP System


Migrate To A Cloud ERP System

Despite the buzz surrounding cloud computing, a number of enterprises still rely on traditional server systems for their core business activities. A recent study conducted by Gartner showed that just over 2% of organizations have their core ERP systems located in the cloud. However, this figure is expected to change dramatically over the next five years when half of these organizations make the switch to cloud ERP systems.

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One of the major reasons behind this dramatic growth is the lack of scalability among the traditional ERP systems. A Gartner analyst had earlier predicted that non-SaaS ERP systems could be termed ‘legacy software’ as early as 2017. With more and more businesses picking cloud ERP for their agility, cost-effectiveness and scalability, the phasing out of traditional ERP over the next decade seems inevitable.

There are a few reasons why the migration to cloud ERP has not happened already. One of the major reasons is the concern over security. To a number of large enterprises, data security is paramount. With a cloud-based ERP system, these enterprises now have to rely on third parties for the security of their data. The allegations over NSA spying on enterprises has only made these concerns bigger. A Gigaom research last year showed the potential loss to companies due to the PRISM fallout to be as high as $180 billion. However, cloud companies have since stepped up their security infrastructure which will assuage the concerns of customers. With the benefits of cloud ERP far outweighing the security concerns, it is only a matter of time before the adoption rates rise again.

Besides beefing up the security layer of their service, cloud ERP companies are also enhancing the overall product. Consider Netsuite, for instance. As one of the leaders in the space, Netsuite recently announced a complete overhaul of their user interface by introducing new personalized tools, a minimalist navigation toolbar and an HTML5 based interface that is expected to work on multiple device types. Besides these, Netsuite has also announced the launch of a new B2B customer center e-commerce portal that should let authorized Netsuite partners like ERPGuru and customers to buy and sell product and services from one another.

As customers, this is the most opportune time to give cloud ERP a try. Thanks to the negative coverage the cloud companies have received post the PRISM revelations, the pricing of a lot of products is extremely attractive. But with better features and enhanced security measures, cloud ERP today is much better suited for businesses that traditional systems. The market is likely to see a flood of new companies taking up cloud ERP over the next five years. By being an early adopter, businesses can expect to take advantage of the benefits that this system has to offer without compromising on security or paying a higher price for the product; something that is expected to happen once cloud ERP becomes mainstream. What are your thoughts?

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