Do you remember the phrase, “If all of your friends jumped off a cliff, would you jump too?” The classic ‘mom’ shutdown to the oh-so-common “…But all my friends are doing it” line. While mother knew best when it came to keeping you out of trouble as a result of peer pressure, we can safely assume she didn’t know much about the cloud.
The Good Kind of Peer Pressure: Companies Forging Their Way to the Cloud
It’s fine. We’re guessing she’s not alone. After all, you clicked this article for a reason. That’s not meant to be patronizing, thousands of businesses are still in the process of evaluating whether or not they should make the move their business management towards the cloud.
Well, tens of thousands more businesses have made the move, and we can assure you, this is one of those rare times that peer pressure is a good thing. With estimates that the worldwide public cloud market hit $214.3 billion last year and coming excruciatingly close to a quarter-trillion dollars in 2020, maybe it’s a good time to listen to your peers.
Knowing this, our topic today is just a subset of a subset of the $249.8 billion dollar public cloud market, in fact, it’s a healthy subset of the $110.5 billion dollar Software-as-a-Service market. Cloud ERP is expected to be about 20-30% of the SaaS market, reaching $28.8 billion by 2022.
The Questions You Might Have about Cloud ERP
Again, with many businesses still kicking the tires on a move to the cloud, many companies just like yours are heading out on fact-finding missions, trying to understand whether a cloud deployment is right for your company. Though there’s no such thing as a dumb question, there might be some questions you’re worried to ask. We’re here to answer them.
What’s all this aaS Stuff?
As we mentioned above, Cloud ERP is a subset of SaaS. SaaS is a subset of the cloud. Simple enough? Not really. “aaS” stands for “as-a-service,” and there are dozens of different categories that exist, many of which use the same acronyms. However, there are really only four or so big categories that exist.
- Cloud Business Process Services (BPaaS): Considered one of the newer entries into the cloud market, BPaaS stands for ‘Business Process as a Service’ and it’s a cloud version of business process automation. The goal of this is to use the cloud to reduce costs by automating a business process (e.g. running payroll).
- Infrastructure as a Service (IaaS): The fastest growing of the cloud services, IaaS in its most simple term is a way to provide on-demand access to physical computing resources. When using IaaS, you are essentially using a virtual machine that connects to a cloud.
- Platform as a Service (PaaS): The most likely to become all-cloud (nearly half of all offerings are cloud-only), PaaS represents the location where applications are run.
- Software as a Service (SaaS): The thing you may think of when you think cloud, SaaS represents your ability to access a service in the internet. Gmail is SaaS. Dropbox is SaaS. Many ERP options are SaaS. In ERP, you pay a monthly subscription and can access your software via a browser.
For more information and definitions, check out the Business Software Education Center’s Glossary of IT Terms.
Public, Private, Hybrid… Multicloud?
Another one of those annoying glossed-over topics is the comparison of deployment models.
- Public Cloud: In a business context, this describes the virtual space in which a vendor offers their software. The vendor stores all the data of their customers on servers. Everything is kept separate, but all customers share a pool of processing power.
- Private Cloud: While the public cloud represents a super-server handling the needs of all customers partitioned separately, Private Cloud represents your explicit ownership of processing power.
- Hybrid Cloud: Combining on-premises processing resources with either public or private clouds. Sometimes a necessary consideration for regulated industries or companies in need of local governance.
- Multicloud: The combination of two or more clouds. For example, combining NetSuite or Acumatica with Power BI, or even something as simple as using a CRM solution to handle email delivered through G Suite.
How Long Has the Cloud Been Around?
This technically has a simple answer—22 years (though Oracle and Salesforce seem to argue which really came first).
However, the history is actually a bit more complicated if you explore the theoretical nature of the cloud. In fact, the concept of time-sharing in the 50s had some similarities and there were many more hypothetical elements in cloud computing worth considering. We explore the history of the cloud here.
There’s a lot of Talk about “True Cloud.” Isn’t the Cloud Just an Application Delivered via Internet?
Good question. Here’s a similar question. If you put a Rolls Royce hood ornament on an old jalopy, does it make it a Rolls Royce? Under the logic of some “cloud vendors” it does.
True cloud applications were built in the cloud and built for the cloud. They were built to handle all the requirements of the cloud. Simply existing in the cloud doesn’t mean it’s a cloud application.
One area where true cloud applications thrive is in integration. Integrations in true cloud applications are easy to set up and resilient in the rapid update world of the cloud. Fake clouds are built on old architecture, often leaving your IT staff on firefighting duty two or more times a year as they work to fix a broken integration. Learn how to tell the difference here.
So… What Are the Benefits of Cloud ERP?
We might be a bit biased, as we do work with a few of the best cloud ERP providers out there, and we’re always happy to discuss why companies benefit from cloud solutions like NetSuite and Acumatica.
However, some of these benefits are vendor-agnostic.
- Low Upfront Costs: One of the most common reasons companies choose the cloud is the ease that the selection has on your finances. Compared to the capital expenses, the cloud offers a much simpler monthly cost. This helps you understand how much you owe and plan for it.
- Grows with You: Another of the benefits of the cloud is the flexibility. Unlike the perpetual licenses that you’ve come to know, the cloud allows you to add or remove users as you need. In fact, Acumatica doesn’t even charge you by user, so you can add users who don’t use a lot of resources while still keeping your costs low.
- Updates without Headaches: True cloud applications provide frequent updates. While this may sound like an awful time in an on-premises environment, in the cloud, these are reasonably headache-free. No longer do you have to worry about broken integrations, as they rely on open and resilient APIs to connect applications.
There are many more benefits, which become even more prevalent as you begin to narrow down your potential solutions. We will discuss these in a later blog.
Your Journey to Cloud ERP Doesn’t Have to Be a Challenge
Though many companies may worry about the challenges in moving to the cloud, with the right partner, it can be a peaceful experience. Though it’s not ‘flipping a switch,’ with the right planning and help, implementations don’t have to be traumatic, time-consuming, or tedious. If you’re looking for more advice on working in the cloud, get to know MIBAR.