History of Cloud ERP & CRM
In the late 19th Century, electricity was not readily, cheaply or easily available. In fact, if you wanted to power your factory, you generated your own electricity with a generator, fuel and a staff of engineers and workers. Your capacity to produce your product was directly dependent upon the capacity of your generator to produce electricity. You had to have bigger, better, newer generators to be able to make more products.
Enter, the power grid carrying various voltages of alternating current electricity. With the flick of a switch you can power your entire assembly line, sawmill or small workshop. The lives of engineers were changed permanently.
The same is true for Information Technology workers. As the generational shift brought us from Mainframes to Client-Server to Cloud, the IT staff necessary is reduced.
In the 1980’s, Mainframes required a staff of hundreds of operators, programmers, report writers, analysts and others to support user bases of only about a 5x to 10x multiple.
In the 1990’s, Client/Server required less IT staff to support a much larger user base. However, most IT departments were focused on Microsoft Domain Management, Exchange, File Services and other critical applications. They were less interested in helping the enterprise through the deployments of ERP or CRM software.
The 2000’s and current technology has IT departments continuing to downsize and outsource. This movement began when Microsoft began providing Hosted Exchange, Hosted SharePoint and Dynamics CRM Online. These new options coupled with economic forces caused many enterprises to look at their IT spend on labor, software, maintenance and hardware.
The result was that many enterprises made the decision to move their e-mail, document sharing and customer relationship management to the Cloud. For many organizations the math was too compelling to keep spending on IT when they can “set it and forget it” when it comes to their infrastructure.
I say “current history” for a specific reason: change is rapid today. What we think is current is actually history. Consider the applications of NetSuite and Salesforce. These applications were written as SaaS applications in the early 2000’s and at the time were hailed as the epitome of next generation ERP and CRM. The term “Cloud” was not used.
Since their popularity in the mid-2000’s, the reasons for moving to the Cloud have changed as well. Today, customers are choosing Cloud for lower costs of ownership (TCO), reduced costs and reduced up-front costs.
However, I submit to you that these reasons for buying are changing as well. The impact of tablets such as iPads, Android tablets and the upcoming Microsoft Surface we will see new demands from the users of these devices. These demands will go beyond the need to run an app on any browser. The demand will be to “appify” everything from time entry, expense management and executive analysis.
Further, Windows 8 applications are going to further impact the market demands. With full integration to Microsoft’s SkyDrive Cloud Storage solution and many other features, this will help to shape the perception and image of the Cloud going forward.
As we see in the Rogers’ Bell Curve, there is opportunity in every stage of innovation. The current stage of innovation for Cloud ERP is either Early Adopters or Early Majority, depending upon your analysis. That said, there is a lot of opportunity for the business who takes the leap from Hosted Exchange and SharePoint to a Cloud ERP and CRM solution.
The opportunity for the business is to move off of legacy software and onto a solution that will be viable for many years to come. Furthermore, these Cloud Solutions have the ability to do much more than just replace current functionality.
Initially, you will recognize the cost savings of reduced upfront costs. This means that you can be more critical in your evaluation of solutions and find one that fits your business needs.
With the right solution, you should be able to further capitalize on reduced implementation costs. Today’s Cloud ERP applications do not take the army of consultants that yesterday’s applications did. Further, new tools and technologies will give you the ability to get to a working system faster.
This “time to value” is the time from when you make the initial purchase until you are fully utilizing the application. The value of an ERP application frankly is to live up to its name: Enterprise Resource Planning with the emphasis on the Enterprise! Involving everyone from Finance, Manufacturing, Project Management and the Warehouse is finally recognizable due to the technology, deployment methodologies and license models.
Robert Houdeshell is a Cloud ERP Solutions Expert with two decades of experience in deploying ERP and CRM to small and midsize businesses. Robert has created private and highly integrated hybrid cloud solutions utilizing Dynamics GP and CRM. His vision and leadership helps clients overcome operational deficiencies through cost effective solutions. Currently, Robert owns his own company called Strata ERP Cloud Solutions – focusing on Acumatica ERP and CRM.