As manufacturers and distributors look to continuously improve operations, reduce inventory and increase profitability, they are beginning to adopt cloud ERP in large numbers. More than half of new US software installations are now cloud based. In the past weeks, we have looked at how cloud ERP can make you more effective and we have addressed the concerns that manufacturers have with cloud applications. This week, we will discuss the key things you must consider when moving to a cloud ERP.

Why Companies Make the Move to SaaS or Cloud ERP

Manufacturers and distributors are making the change to a cloud-based ERP for several reasons. Often, companies with on-premises ERP systems are tired of maintaining and updating their own software or they may be looking to consolidate multiple ERP systems. Most importantly, modern ERP systems support modern processes. The rapid evolution in technology has driven changes in how we manage our manufacturing floor and warehouse.

An Aberdeen Group study, “SaaS and Cloud ERP Observations: Is Cloud ERP Right for You?”, identifies the top business reasons that companies move to SaaS or cloud ERP.

• Must reduce IT costs (35%)
• Need collaboration amongst increasing number of locations (31%)
• Increasingly global workforce working in multiple time zones (24%)
• Cost of capital funding is too high (24%)
• Dated technology infrastructure (22%)

How to Choose Your ERP Deployment Method

When you are considering changes to your core business software or ERP system, how should you choose the best deployment model? Of course, your first consideration needs to be whether the ERP system has the functionality and usability that you require. Only then should you determine the deployment method that will fit into your business strategy and financial goals. Evaluate the costs and benefits of moving to the cloud. Consider the risks of making a change. Identify the additional capabilities you will gain with cloud software such as increased mobility.

If you are evaluating your ERP deployment, here are the questions you should ask:

• Do you have the IT staff and technology systems to support an ERP in-house?
• Do you have multiple locations that need access to the ERP?
• Do you have the ability to secure your core systems?
• Do you need to install the ERP system quickly?
• Do you have the capital to invest upfront or would you prefer to incur these costs as an operating expense?

How to Make the Move to Cloud ERP

Implementing a cloud ERP should be a strategic decision that helps transform your business processes. An important first step is to determine your strategic goals and then align your cloud ERP implementation to meet those goals. Here are some best practices for implementing cloud applications.

1. Start small: Implement your new ERP in one location first. Then roll it out to the entire organization. Be prepared to be in a hybrid situation for a while.
2. Keep it simple: Don’t break up ERP modules among different deployments—keep your processes in one place.
3. Set standards: Standardize data and policies across your business systems. Determine how transitioning to the cloud will require changes in policies.
4. Increase capabilities: Change your business processes to take advantage of cloud software capabilities. After all, this is one reason you are making the move.
5. Maintain accuracy: Make sure you port data accurately to the new system or between systems in the case of a hybrid implementation.
6. Get support: Your ERP vendor should be capable of providing the support and security that you require.
7. Communicate: Establish effective channels of communication for problem identification and resolution. Define clear responsibilities between internal and external providers. Clearly define confidentiality, integrity and availability in all business processes that depend on the cloud.

Are You Ready to Move to Cloud ERP?

Learn more about the benefits of moving your ERP software to the cloud. Download our free whitepaper, “SaaS and Cloud ERP Observations: Is Cloud ERP Right for You?”

When you are ready to complete your ERP selection with a cloud-based deployment, PositiveVision has the products and systems you need to be successful. Sage 300 gives you unprecedented flexibility, a robust suite of modules, complete customization, scalability, and seamless integration between your business management software. Sage 300 is available in both an on-premises and web-based model. If you already have a Sage ERP implementation, we can work with you to add cloud capabilities to your software. Contact us to get the process started.