“It is better to have your head in the clouds, and know where you are … than to breathe the clearer atmosphere below them, and think that you are in paradise.”
— Henry David Thoreau
We’ve written about cloud-based enterprise solutions for quite some time now, and cloud-based enterprise resource planning (ERP) has been one that has moved a bit slower than other applications. But it’s gathering speed—and fast. A recent column on searchfinancialapplications.techtarget.com points to a big reason why: CFOs are finally getting on board with cloud-based ERP.
Nearly 50 percent of organizations are planning to move their core ERP to the cloud by the end of the decade, a movement facilitated by the use of cloud-based solutions in other areas as proof of performance. According to the article, CFOs have “turned the corner” on cloud-based ERP because they see it as a means to improve efficiencies, drive down costs, and realize the flexibility necessary for digital transformation.
The article notes the change involves more than just greater comfort with the technology; it’s also about what the technology offers. Said Steve Cox, vice president of ERP/EPM cloud-to-market at software vendor Oracle:
Beyond having an increased comfort level with the cloud, CFOs are being drawn in by the new capabilities of cloud-based ERP platforms, particularly in areas like analytics, performance dashboards, more sophisticated planning and modeling capabilities, and support for mobility. As CFOs expand their roles beyond cost containment to growth and business transformation, they are increasingly confronted with the limitations of on-premises ERP, and they view new cloud-based platforms as the drivers for reinventing core business processes.
Additionally, security and compliance—two long-time barriers to the adoption of cloud-based ERP—are now seen by CFOs as reasons to embrace the platform. According to Lisa Pope, senior vice president of cloud sales and strategy at Infor:
With complex security issues multiplying at precipitous rates, CFOs and their C-suite counterparts are recognizing they simply don’t have the skilled manpower and budget, let alone the internal resources, to properly safeguard enterprise IT assets, to stay abreast of a constantly shifting landscape.
The one challenge that must be faced in migrating current core ERP systems to cloud-based ones is the data transition, as most cloud platforms are built around different data models; but rising adoption rates indicate this is far from a deal-breaker for most organizations.
Increasingly, it seems CFOs know where they have been, where they are, and where they need to be as the digital transformation continues.