Hybrid Cloud: Is It the Future of ERP?
One of the biggest problems with ERP deployments is that most software solutions available today remain expensive to purchase and way too complex to be set up by most in-house IT departments. Cloud ERP, on the other hand, is more affordable and can help alleviate a number of issues relating to ERP implementations. Because technology users have varying constraints and requirements, which can often lengthen the migration process from on-premise to cloud deployment models, the ERP landscape is presently moving toward hybrid convergences. This means that enterprise solutions are increasingly becoming cloud-based, even though most of them are currently deployed in hybrid cloud environments.
Hybrid solutions allow organizations to adopt cloud-based ERP applications at their own pace and in a manner best suited to their needs. Basically, there are two hybrid deployment models: 1) on-premise ERP systems combined with applications deployed on public or private clouds; 2) existing cloud-based applications integrated with new on-premise deployments.
The question is why would you abandon your on-premise ERP solution perfectly tailored to your organization’s needs to adopt a hybrid cloud deployment model? The answer is quite obvious: by combining an on-premise system with applications deployed in cloud environments, you can “outsource” certain business processes for greater efficiency. For instance, you can choose to manage financial transactions via on-premise applications and move certain mission-critical operations (e.g. manufacturing processes and maintenance tasks, along with customer and vendor applications) onto private and public clouds.
It’s also worth mentioning that hybrid cloud deployments are very flexible options. You can investigate your existing ERP solution and choose as many applications as you would like to be deployed to the cloud. By distributing your internal workloads evenly among different deployment models, you’ll relieve the pressure on certain areas of your IT infrastructure. As a result, you can achieve greater business agility and operate more efficiently.
Although any company can opt for a cloud ERP solution, mid-sized and large organizations with IT budgets prohibiting an in-house data center are expected to make the most of hybrid environments. Hybrid cloud computing finally offers companies the complex, solid, nimble ERP solutions they need to gain true competitive advantage.
Many ERP solutions are already available as cloud deployments. The best thing is that these solutions can be used in conjunction with on-premise software for the execution of different processes. Besides offering greater agility, hybrid cloud deployments imply lower cost of ownership, including lower implementation and maintenance costs, compared to an on-premise approach. Moreover, cloud deployments are easier to manage, because no physical equipment is installed on-premise. A small IT team can easily control and audit multiple ERP systems deployed on the cloud from one central location.
According to Gartner, about 70 percent of organizations will migrate to hybrid services by 2017. In fact, many ERP vendors have already confirmed that an increasing number of companies are expressing their interest in cloud environments, with large numbers responding positively to hybrid deployment models. While potential gains from hybrid cloud deployments cannot be denied, vendors recommend this model especially because it makes IT infrastructures more scalable, while putting technology teams in a more responsible position.
Not too long ago, organizations were reluctant to combine their on-premise ERP systems with applications deployed on the cloud, but things are about to change. As security issues diminish, more and more companies are willing to give the cloud a whirl and take advantage of its benefits. Now, the real challenge faced by most ERP vendors is to find a way to offer customers the benefits of hybrid cloud deployment models, while protecting their investments in existing ERP solutions and IT infrastructures.