Enterprise Resource Planning (ERP) in the Cloud is creating a lot of buzz among industry professionals – for both its ability to reduce costs and capability for rapid implementation. (Note – For rapid implementation proof, you can read my recent blog post – or request the video to the right – where you will see a full Microsoft Dynamics ERP cloud implementation in 30 minutes or less.)
But among the industry excitement lie some legitimate industry concerns – particularly among larger companies.
Eric Kimberling of Panorama Consulting surfaced the two largest concerns in a recent blog post: flexibility and security. And while many small and mid-sized organizations are will to weigh these legitimate risks, some larger corporations remain on the fence. Fortunately for these larger corporations, these risks are just as manageable as they are legitimate.
In regards to flexibility, while this is a valid concern, leading ERP software (like Microsoft Dynamics) is designed from the ground-up to provide the ability to cope with ever-changing markets.
For example, Microsoft Dynamics ERP is designed to encode knowledge in models to achieve expressiveness, conciseness, consistency, ease of understanding and ease of exchange. In addition, all third-party software, including modeling tools, are embedded in such a way that they can be exchanged. These features allow for flexibility even among large businesses in complex industries.
Security is perhaps the most common concern with the cloud. But even in surfacing this concern, Kimberling notes that it can be alleviated with the right Service Level Agreement – which any reputable vendor will be more than happy to accommodate. Additionally, Microsoft Dynamics ERP provides – as one of its hallmarks – data confidentiality provisions according to CIA principles:
- Confidentiality: preventing disclosure to unauthorized individuals or systems.
- Integrity: data confidentiality cannot be modified without detection.
- Availability: systems always available, thus preventing service disruptions.
ERP in the Cloud is and will continue to be a buzzing topic among industry professionals. And as with any buzzworthy topic, the pros and cons must be weighed and scrutinized to ensure it is the right solution for your organization. I would be happy to help you weigh these pros and cons and address any additional concerns you have. Please feel free to share a comment below or contact me through the To-Increase website.
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I think ERP on cloud will be the future of ERP due to cost/security issues.
Security is no doubt the top concern, at least according to my survey of over 900 respondents. Service level agreements can make things right if something goes wrong, but the real worry is securing the data so that there is less chance of a breach. Today it is unlikely there will be zero chance of that. So you have to actively manage that risk.
One of my biggest concerns is that those who choose to stay out of the cloud might think that simply by doing so they are safe. But unless there is absolutely no way of accessing your servers and software from outside you building, there is still risk. That would mean no VPN, no way your trusted employees can access anything outside of the office. Even laptops that leave the building and are subsequently re-connected can cause security breaches.
My point? Security is an issue whether you are operating applications in the cloud or on-premise and too many overlook the dangers. Operating in a SaaS environment may actually be safer.