IT and The Changing Landscape of ERP

Garth Thompson, SVP of Global Support & Services, Penguin Computing
Garth Thompson, SVP of Global Support & Services, Penguin Computing

Garth Thompson, SVP of Global Support & Services, Penguin Computing

The rapid adoption of cloud services is changing the fundamental technologies that businesses rely on. Software as a Service (SaaS) is democratizing technology, allowing organizations to focus more on their core business and less on building their technical infrastructure. As these commoditized cloud solutions replace customized on premises solutions, the role IT plays in the business is changing. Their new role will be focused on information management, working to ensure the rest of the company has the right information, at the right time, in the right format. This results in a company providing better tools and resources to their employees which leads to a faster, more efficient business.

 SaaS is giving every business the same lightning fast tools to use. As applications are moved off premises, the resources required maintaining servers and applications are decreasing. Since users are running fewer applications on their desktop, helpdesk calls are trending down with quicker resolution times. What is not going down is the amount of information generated by businesses and the overall complexity of that data. Managing this data in either cloud or on premises solutions is of paramount importance and will become the primary focus of IT departments. As the number of different solutions continues to grow, knowing what to integrate is going to be just as important as how to integrate it. In the ever evolving business and technical landscape, quick and meaningful access to information is critical to success. To take full advantage of these new applications and technologies being developed, the Enterprise Resource Planning (ERP) system of any business needs to be integration friendly.

ERP solutions have traditionally been on premises and cloaked in an aura of fear and mystery by those that have to use and support them. Many of these solutions were outdated 10+ years ago and by today’s standards look like monstrosities of bloated software and aging servers. Leagues of consultants are needed to perform implementations, upgrades and customizations. IT departments need specialized individuals for ERP administration. Developers write code in proprietary systems that has zero chance of reuse. It all adds up to systems that are slow, expensive, inefficient and resistant to change. If the core ERP system of a business is costly, slow to change, requires specialized training and skill sets and does not integrate with modern software architectures, the rest of the business cannot be fast moving, agile and efficient.  

“Moving ERP to the cloud is one of the important infrastructure decisions. It frees IT staff from maintaining on premises solutions and backend work required for these mission critical systems functioning”

Moving ERP to the cloud is one of the most important infrastructure decisions a company can make. There are significant advantages to be gained by running in the cloud that often out-weigh the perceived risks. For IT, it frees them from having to maintain on premises solutions and the backend work required to keep these mission critical systems functioning. That time is better spent improving the experience of internal customers creating new tools, optimizing workflows, improving processes, writing reports. In essence, making the company's data more accessible to its consumers. Time once spent keeping critical systems up and running can now be used to make the company more efficient. For this to happen, the core ERP system needs to be a well designed SaaS solution with a robust, well documented API. NetSuite is an example of an ERP system that has been designed from the group up to make data access and integration easy. The SaaS model also ensures that users are all on the latest patch level and that new features are released to users on a regular schedule. Everyone on the platform is getting the same technical advantages while those with on premises solutions have to spend their own time and resources keeping their ERP systems healthy and up-to-date. 

The SaaS model puts a different set of stresses on an IT team. Their traditional workload is replaced by new challenges that require new skill sets. The first among them is a solid understanding of the company’s business. The pace of business is ever increasing, to remain competitive companies need to identify  and implement the correct technologies  faster than ever. To do this, IT needs to understand the business requirements so that they can help the company make the correct technology decisions and work  to ensure the implementations are done  correctly. The next critical skill set is software development. The line between system administrators and software engineers is blurring in the world of IT.  Having good software engineering skills and practices on the team will be a huge advantage as a company moves to the cloud. While it is possible to outsource all the integration work, doing it in house has some advantages. 

With modern languages and well documented APIs, developers can accomplish more than ever before in short periods of time. Having someone in-house will allow IT to manage the ever growing and changing array of SaaS application and help protect the company's data integrity. Understanding the overall data model for the company and how each system interacts is critical for long term success. Well implemented integrations will also increase adoption by internal customers. The smoother the integration, the higher the level of adoption, almost every time. A poor integration guarantees poor adoption.

 For any new technology to be successful, it needs to be adopted by the users. If they don’t like the new tools, they will resist using them and find work around. Modern users have high expectations about how software should look and feel. Employees are familiar with browsers and use them on daily basis. SaaS applications use this to their advantage by providing clean, intuitive designs that users are familiar with. This reduces the learning curve for new applications and increases adoption.

 In the modern landscape where SaaS solutions are rapidly replacing on premises solutions, IT departments are no long just the shepherds of servers and aging software stacks. They are playing a key role in ensuring that technologies are aligned with business needs. They work to ensure that a company’s data is accurate, available and safe. A company’s decisions are only as good as the data used to make those decisions and that data is in the hands of IT.