Coronavirus » Benefits of cloud ERPs not spread evenly

Benefits of cloud ERPs not spread evenly

Some businesses will benefit more than others when moving to a cloud-based ERP

Even before coronavirus, there was a steady migration of companies moving towards cloud-based ERPs. And with most employees now working from home, the advantages of a cloud-platform, such as remote access from multiple users have been made more evident. However, adopting a cloud-based ERP is not as straightforward as some businesses believe says, Wes Gillette, vice president of product management at Insightsoftware. Businesses need to understand both the offerings and limitations of the software.

For companies that already have an ERP, there exists an expectations gap between what they envision a cloud-based ERP doing and what it actually can do, says Gilette.

“It’s the promise of the cloud. We think about any applications that have moved to the cloud, and what they provide is always on and always available” says Gilette. “I think there’s an expectation that even core business applications as they move to the web, enable better speed, reliability, performance, etc with ERPs being no different.”

“Companies think that when they move to the cloud, there’s going to be this massive shift from a business perspective of what it offers them. “Moving from some ‘legacy system’ to a cloud based system. There’s this promise of faster access, faster reporting, that they’ll have access to all the information they need to be online. And the reality is, it doesn’t turn out that way.”

In a recent survey carried out by Insightsoftware which polled over 450 financial professionals, 38 percent expected faster reporting and 30 percent improved automated reports when migrating to a cloud-based ERP. What they often find though is a system that still has “time-intensive and error-prone manual processes”.

Many of the legacy ERPs that companies have were built up over years to suit the needs of the business. “ERPs that are on premise have been tailored and customised to meet their individual needs as a company,” says Gilette. “When you control the ERP on premise, you can extend it, you can integrate with it, you can modify it, really tailor it to your business.

“When you move to the cloud that [level of control] goes away. That’s the nature of it when you move to a multi tenant SaaS application like with cloud-based ERPs there’s less room for customisation.”

Uptick in ERP usage

While businesses that have an existing ERP may not find a cloud-based ERP is all they had hoped for, SMEs and companies that have only rudimentary ERPs are quickly adopting cloud-based solutions as coronavirus shutters the global economy.

Colin Hewitt, CEO of Float, a cash forecasting ERP, says he has seen a huge increase in the number of new users. “We’ve seen six weeks’ worth of normal trial signups in the last three days, last week has just been off the charts for us.”

He says many businesses are trying to get a better understanding of their cashflow.

“What everybody’s looking at is trying to get visibility on what the future holds across a few different scenarios. It’s managing outgoing cash, being able to look at pushing certain things back like VAT, PAYE deductions or even just lowering costs.”

With many companies taking stock and revaluating their finances, Hewitt says now is the time to seriously consider a cloud ERP.

“Businesses are always thinking about [adopting new ERPs] but now is a really good time to demonstrate, ‘what could we have done if we had had this all set up in the first place?’ Will this be the last disaster to ever hit the global economy? I don’t think so. Businesses having these systems in place and taking the time now to do something is really important.”

Despite the fact that nearly all employees are working remotely, he says that shouldn’t impede a business from adopting a cloud-based solution.

“It depends on the size of the business but there’s no reason I can think of that would be hinder implementation. If people are using cloud-based systems, there’s no need to access servers and if they need to, they should have a VPN. I really can’t see why it couldn’t be done remotely.”

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