Why cloud is killing traditional ERP systems

2016-08-30 - By 

Cloud ERP systems are continuing to accelerate, leading to the slow death of traditional ERP

ERP is business process management software that allows an organisation to use a system of integrated applications to manage the business and automate many back office functions related to technology, services and human resources.

Software giant Oracle announced last week its intent to buy cloud computing pioneer NetSuite in a deal valued at $9.3 billion.

Netsuite is one of the major cloud ERP providers and Oracle’s acquisition of the company “serves as further reinforcement of the accepted fact that ERP systems are moving to the cloud”, according to Sabby Gill, executive vice president for international at Epicor Software.

The implementation of cloud ERP is growing, as research and analytics firm Forrester suggests: actual and planned ERP cloud replacement activity grew from 24% in 2013 to 43% in 2015.

>See also: Are large organisations finally embracing ERP in the cloud?

But what are the reasons behind this exponential growth? Why are companies choosing to abandon traditional ERP and adopt the cloud (or hybrid) version? What are the catalysts behind cloud ERP’s rise?

Supporting new business models is key a factor allowing companies can scale to new customer demands, while cloud ERP systems save up to six times the amount of capital invested cumulatively over traditional ERP systems.

Cloud ERP systems are far better suited to handling more complex manufacturing lines, where market speed is just as important as production scale.

Versatility is also central to cloud ERP.

Customers don’t have to be put in one category, and cloud ERP takes advantage of this by embracing the variety and changeability of the modern customer.

>See also: Four reasons why 2016 marks the end of the road for traditional ERP systems

Its implementation is to embrace the digital transformation, Gill believes, which will supplement core business growth.

Cloud ERP offers companies flexibility and mobility in a volatile, undulating market.

The choice to adopt cloud ERP is not a difficult one, and the adoption of the new technology will lead to new frontiers for businesses.

Original article here.

Posted In:  Cloud Computing
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