Medium and smaller businesses are catching up on cloud usage. In addition to office applications, Enterprise Resource Planning (ERP) from the cloud is being used more and more frequently – because there are a whole range of reasons for outsourcing in this area.
The reasons for working with a cloud provider vary from company to company. Nonetheless, seven factors can be identified that tend to motivate SMEs to step into the cloud.
1. Master the balancing act between strategy and day-to-day business
IT leaders are expected to drive their business forward on strategic issues. The management has written the implementation of the Internet of Things, Industry 4.0 and more recently also the topics Machine Learning and Artificial Intelligence into the task book. Of course, the day-to-day business of IT operations continues smoothly.
To relieve their resources for these strategic tasks, more and more medium-sized companies rely on cloud-based ERP – then the provider takes over the monitoring and maintenance of the infrastructure and thereby contributes to the relief of in-house IT. He also provides the Software-as-a-Service model for ongoing updates and patching of the ERP application.
2. Reduce infrastructure investment
If you “buy in” your capacity with a cloud provider, you will kill two birds with one stone in terms of budget. On the one hand, it saves the high initial investment in server and system software and, on the other, it automatically buys the ongoing renewal of the IT infrastructure on. Today, hardware and software are becoming so obsolete that it is difficult for medium-sized companies to stay up to date.
3. Accompany expansion and growth
In addition to the costs, many companies are convinced above all of the flexibility: another office in a new city? An additional foreign location? Sales and production branches can be quickly and easily integrated into the ERP via the cloud. For this, it is not necessary to establish a data center on site, nor to cease IT resources. If the business flourishes and the location is to be further expanded, additional users can be added as quickly.
4. Support decentralized corporate structures
In many places, the way in which companies work is already characterized by flexible working time models and increased mobility: employees work from different locations, some of them in their home office in whole or in part. An ERP from the cloud supports this, because it makes working with the system location-independent. And the more the millennial generation (born between 1990 and 2000) moves forward into the company, the more important is this free, flexible work.
5. Focus on the core business
With digital transformation, the role of IT as an enabler of important business processes has gained in importance. IT needs to focus on those areas where the company “makes its money”: in mid-sized manufacturing companies, these are typically innovation developments and production. The operation of the IT infrastructure is therefore increasingly being handed over to external cloud service providers.
6. Ensure high availability and safety
An uninterrupted IT operation is a must today. By transferring the ERP system to the cloud (and flanked by corresponding service levels), companies get guaranteed high availability into the house. The same applies to the mammoth task of security: the more complex the security threats become, the more real security specialists are required. Big professional data centers protect data better than many mid-sized companies could ever do.
7. Shorter implementation times
The market success of a company depends to a great extent on its agility today – this also applies to IT: new solutions have to be productive within a few weeks, and adaptations must be flexible and swift to implement. With the help of the cloud, companies are usually faster with their IT because they rely on existing infrastructure.
Rational arguments for the cloud have meanwhile prevailed over the diffuse fears of loss of control in the majority of companies: IT leaders have now understood that the cloud does not threaten their reason for being. On the contrary, they increasingly resort to this, as they and their team have more time for tasks that the company and they can take forward.