By Edward Jackson, President
As the demand for actionable business intelligence grows at today's leading corporations, the focus for information leaders is finding the best way to fold niche applications into their existing ERP platform. The ultimate goal is to eliminate information silos to the greatest extent possible so that executives can view their organization in a more complete, holistic way.
Cloud-based applications have clear advantages in terms of upfront costs and speed of implementation, although the thought of integrating SaaS with on-premise systems puts some CIOs in a cold sweat. Common concerns include connectivity issues and the security of sensitive business data. These are all valid considerations, although frequently the perception is a lot scarier than the reality.
A number of SaaS providers are offering technology that can be integrated "out of the box" with common ERP systems such as Oracle and SAP, eliminating the need for time-consuming interface development. Applications built on an enterprise architecture also enable many of the rich features offered by the "parent" software. Security is another key concern for information leaders, as it should be. The fact is that most large companies have their data off-site already, and their encryption and security protocols may not be as strict as those enforced by the on-demand software vendor. Often, the more questions a client will ask about a vendor's privacy and security features, the quicker it disappears as a worry.
As these issues are addressed, the benefits of cloud-based software become apparent, particularly for key administrative functions such as HR, accounting and procurement. Major companies, typically aren't ready to invest in large upfront outlays for new applications. The generally high cost of upgrades only adds to that challenge. By utilizing hardware more efficiently and charging clients based on actual use, on-demand applications help on both these fronts.
Rather than worrying about data center and equipment issues, IT personnel are freed up to do tasks that actually add value to the organization, such as improving reporting capabilities. Perhaps the quickest converts to on-demand apps are front-users, who gravitate toward the familiar feel and more intuitive layout of a web-based program.
Just because your enterprise software is on-premise doesn't mean your company has to build out its data management capabilities using that approach. Given the budgetary and workforce limitations most organizations are faced with today, the agility and value of SaaS makes a compelling case.