Mis – Case
Enterprise Applications Move to the Cloud useful Information for CASE STUDY QUESTIONS: Over the past couple of years, there’s been a lot of noise from business management software manufacturers about cloud computing and the impact of the cloud on their products and services. Especially from those that produce CRM and ERP applications.
From a business user’s point of view, whether you choose to implement your software as an on-premise solution or choose a cloud-based option will depend on your business requirements: your aims, objectives, resources, preferred costing or moment methods, and what you need from your CRM software or ERP solution. With cloud-based CRM and ERP solutions, the application and data is held on a network of computers kept in advanced data-centers, nearly always at a number of different locations.
This meaner your software provider takes care of the running, maintenance and security of the application and servers 24 hours a day, seven days a week.
There are a variety of reasons businesses choose cloud-based applications. With CRM and ERP, the key reasons tend to be that a business can be up and running with the software relatively quickly. There’s also less need for in-house IT staff or high levels of technical skills, and things like security and upgrades are looked after by the vendor. Probably the most common deciding factor between cloud and on-premise is that cloud-computing makes your software an operational expense rather than a capital spend.
There’s usually little or no financial outlay in terms of hardware and IT infrastructure, and you pay a monthly fee to use the product, which is based on the number of users you have. That works both ways; some businesses prefer a capital spend and to ‘own’ the software. Others prefer an operational cost, as with the cloud. For cloud-based applications, you also need a reliable internet connection, and in some sectors there can be issues with the geography in which the data is actually held.
Many mainstream business software vendors are working to transfer their traditional on-premise applications in to the cloud. From a technical point of view, however, it’s not as straightforward as it may first appear.
Although, once it’s achieved, the results are arguably superior to applications that have been developed as purely cloud-based applications. Why? Because they give customers choice. Not just for the initial implementation, but as their business grows, develops and changes, it’s easier to move from or to the cloud.
Businesses can also move from the public cloud to their own private cloud, with the same application. This is one of the unique benefits of Microsoft Dynamics CRM and its cloud-based version Microsoft Dynamics CRM Online.
Both Microsoft Dynamics CRM and Microsoft Dynamics CRM Online are effectively the same products; they’re built using the same code base. So it’s not that difficult to move a company that’s using the on-premise version to the cloud version, or vice versa. Compare this with many of Microsoft’s cloud-based competitors (such as Salesrooms) which are cloud-only applications.
Because they are cloud-only, you can’t go on-premise even if your business strategy dictates it in the while, ERP in the cloud has been taking off at a slower pace than CRM. In April 2011, nearly three-quarters of Microsoft Dynamics CRM seats were sold for the cloud version. Concentric TTS has been offering mid-market sister product Microsoft Dynamics NAVA as an on-premise solution for several years.
We started offering Microsoft Dynamics NAVA as a cloud or software as a service option about a year ago, ND although it has generated interest among a range of customers, the on-premise version remains more popular.
In a recent independent survey commissioned by Concentric TTS, 67% of senior finance professionals said that they have no current interest in using a cloud-based ERP solution. The same survey cited concerns about security and a lack of information and understanding about cloud technology as the main reasons organizations are staying away from cloud ERP. For the vast majority of businesses, modern commercial cloud applications provide exceptionally high levels f security, including data protection and back-up, and are usually more secure than the majority of on-premise applications.
Sage CRM, the leading mid-market CRM application from Sage, is a web-based product which has had an online version (Gaggers.
Com) available for a few years. Sage were ahead of many other vendors with Gaggers. Com. However, Sage 200, the small and mid-market ERP solution which effectively uses Sage CRM as its CRM module, isn’t due to have a cloud version released for some time. In fact it’s currently looking like the end of 2012.
Sage 200 was built from the ground up as a client-server type application.
It also has many add-on products by third-party vendors, so getting it in to the cloud is not going to be straightforward. You could argue that by taking its time getting its popular business management solution in to the cloud; Sage is going to end up playing catch up with other vendors. But according to research carried out on behalf of Concentric TTS, until ERP buyers agree with the benefits of cloud-computing, and are more convinced of its greater security, there’s actually no real hurry. 2. What are the advantages and disadvantages of using cloud-based enterprise applications?
Advantages (1): Removing hardware and its complications (costs, maintenance/warranties, risk of failure, personnel required to handle them) * Availability: Your services are available regardless of location or anything as long as you have an internet connection * Technology advantage: When you rely on a company that does services for a living, they are better motivated (and also better equipped) to making better technology/services to cater to you.
Often, Cloud Computing technologies are improved than on-site counterparts in terms of efficiency, speed, features and security.
Individual companies cannot spend as much resources or time on the same teems. * Moving from an Capital Expenditure model (where you pay a lot of money upfront of a lot of things irrespective of actual usage) to an Operating Expenditure model (often you will pay for number of servers, or number of users, and you can scale up/down as your size changes and pay for Just that much). This is particularly helpful when trying to predict your costs and these costs stay fixed as they are saving but in light of the next point, should still be considered. What I call to call a better relationship between IT ; the business: Often, proper use of the Cloud ND its technologies help release pressure from IT to handle day-to-day things of keeping everything alive and focus time on more strategic initiatives such as improving delivery, efficiency, response times and helping the business more. Advantages (2): * Remote Accessibility: With cloud computing, your business is not restricted to a particular location.
This applies to individuals also. You can access the services from anywhere. All you need is your ID and password.
In some cases, there may be extra security requirements but as they too are mobile, you can easily access your cloud services from any part of the world. Easy Expansion: As of the characteristics of cloud computing is its flexibility, you can quickly access more resources if you need to expand your business.
You need not buy extra infrastructure. You Just need to inform your cloud provider about your requirements and they will allocate resources to you. In most cases, the entire process is automated so the expansion takes Just a few minutes. The same is applicable if you wish to use less resources.
One of the best advantages of cloud computing is easy re-allocation of resources. * Security: Though people doubt cloud computing, clouds tend to be more secure Han the traditional business models.
Clouds offer real-time backup which results in less data loss. In case of outage, your customers can use the backup servers that sync with the main ones as soon as they are up. Your business gets maximum uptime without any loss of data during the transitions. Other than this, clouds are less prone to hacks and Dodos attacks as people don’t know the whereabouts of your data. Environmentally Friendly: Usage of ready-made resources tailored to your needs helps you reduce the electricity expenses. While you save on electricity, you also save on resources required to cool off computers and other components.
This reduces the emissions dangerous to environment. Disadvantages: * Reliance on the internet bandwidth: Not all countries have cheap or reliable internet connections. * Internal IT expertise: Some people feel that not keeping all IT in-house is a disadvantage to them. * May not always know where (geographically) your data is stored, shared architecture.
Is there a place for On-premise “enterprise” software such as Oracle, SAP or other applications or should all enterprise applications move to the cloud like Salesrooms? If yes can you describe the reasons and applications for these On-premise mean everyone else thinks it should! There are still companies very heavily invested in the on-premise-model and they want to ensure there’s still a place for it.
I’m glad we’re on the newer side of the equation, though. There’s not a very promising future for on-premise because customers are ready for a change. Big investments in client-server produced returns that were elusive.
Furthermore, the economy that we have been dealing with for the past couple of years has caused customers to question a lot of conventional wisdom?especially when it comes to technology. Customers don’t want to part with big buckets of cash or tap into precious credit nines to finance big-ticket purchases of software, hardware and the data center infrastructure that goes with them.
Com companies anymore.
Google does everything (it’s even a verb). Amazon. Com is the Internet’s biggest retailer and its Web services business uses more bandwidth than its retail business. Salesrooms.
Com hit $1 billion in revenue and you can now get all your enterprise APS on demand. At a time when many tech companies are wobbling, we drew nearly 20,000 registrants at our annual Dreamer event in San Francisco last month. That’s about double last year’s numbers. It sends us a message that companies are hungry for better answers than they are getting from SAP, Oracle and Microsoft.
Having seen what’s possible with a new way, companies have been exercising their power of choice.
Salesrooms. Com has established the viability of cloud-based computing. The scalability and security issues that IT was very concerned about early in the cloud- based evolution have been addressed and validated. Do you envision that all future footwear applications will be delivered as a service? Over what period of time do you see this occurring? We are seeing a major shift to cloud computing, and the trend will accelerate. However, no new technology completely replaces another.
We have many customers who still use some form of mainframe and will probably continue to do so for some time.
But the best minds and the best new ideas move on. When was the last time that someone told you about a hot new shrink-wrapped business app? Maybe 10 years ago! The best innovation is happening in the cloud right now, and customers know it. How fast? That’s the big question. Now, every major analyst firm sees cloud computing expanding its share of the overall IT market. The next five years, and the next 10 years will look very different. Right now we are only at the very beginning.
I still have a lot of work to do. Http://www. Gastroenteritis’s. Com/technology/ cloud computing. Every software package, service and even hardware is described as cloud-enabled. Seemingly, we are all headed into the clouds never to return.
However, while the atmosphere is everywhere, the cloud decidedly is not. It is by definition remote – so if your applications require the highest in performance, cloud ay not be the answer. Not all applications will completely move to the cloud. In some cases this will be by design and the type of application, while others won’t be able to avoid migration pitfalls.
For the percentage of business-critical applications that require the highest performance and have the most sensitive information and complexity of process, a hybrid model of cloud services to bridge the decanter, branch offices and trading partners is best. In these instances, the transport time or latency between local applications and those in the cloud may be too much for certain purposes to allow for a standard cloud implementation.
Let’s look at the top five best practices for ensuring optimal performance and uptime when using the cloud for your most demanding applications. . Don’t make assumptions Determine what can go Cloud and what must not. Decide which applications can move to the cloud completely and which ones cannot. This may be an issue of sensitivity where it is deemed too risky but will certainly differ by organization. Other issues may be the aforementioned latency constraint that would apply to “low- latency” trading.
Many of these sorts of applications are “co-located” in the stock exchange in order to circumvent the lag of any external network. But there are many applications where latency in the low seconds is acceptable.
These could be good candidates for cloud residency. 2. Don’t pay for more than you can actually use The cloud is elastic. Are your applications? One of the big drivers for using the cloud is that you only pay for the resources you utilize.
When it determines that you need more resources, the cloud automatically provisions them for you. But not all applications can immediately make usage of additional Cups and memory. There may be serialization in the applications, problems with threading and even memory leaks.
Don’t assume that any application will transparently expand to handle rapid peaks in demand merely by virtue of being in the cloud. The same basic IT architecture principles for handling bottlenecks and designing in performance still apply.
3. Don’t focus solely on the components Remember the transaction. Monitoring is often forgotten when talking cloud; however, it is essential. Rather than merely monitoring the individual components such as the network, servers, JEEZ Webs and message operations, take a step back and monitor the entire transaction path.
Transactions are conversations; if you onto monitor them you will not have a clear idea of what is going on within your infrastructure.
Focus on transaction performance: the speed with which an application completes an activity that meets business requirements and expectations. 4. Beware of insufficient testing Start early and save. Performance testing end-to-end is important long before you reach production. Enterprise applications often communicate with other applications and are integrated using middleware.
It is important to begin testing enterprise applications after unit testing is completed.
This is especially important with orientations that will span the decanter and the cloud. Besides performance place to prevent known problems from reoccurring. And these policies should be consistent across both the decanter and the cloud. Think of the life cycle of an application working with the cloud as a continuum. The farther to the left you begin testing, the less expensive it will be to resolve problems in availability, logic and performance.
5. Control, but don’t over-control Self-service in the cloud drives business performance.
In a hybrid cloud environment there can be many stakeholders that need access to application data. These can range from the enterprise architects, to development/user acceptance testing to IT operations and the shared services team. However, with some of the business process in the cloud, some in the data center and some parts of it farmed out to virtual cloud brokers, we need to make access to this data as easy as possible. Self- service access enables named users to immediately get to the data they need without installing any software and without disrupting the productivity of others to get it.
Enterprises should consider the specific needs of their applications before making the Jump into the cloud. Remember not every application was built to run in the cloud, and therefore it becomes important that the necessary adjustments are in place beforehand to help ensure optimal performance. Http://guillotining. Sys- con. Com/node/2047439 3. What management, organization, and technology issues should be addressed in deciding whether to use a conventional ERP or CRM system versus a cloud-based version?
Cloud computing has recently emerged as one of the most important trends in information technology.
Though some observers insist the concept has been overjoyed, most experts believe it represents a significant transformation in the way footwear is being delivered and used. No one can deny the market for cloud-based solutions is growing rapidly. According to Gardner Group, the market for Software as a Service (AAAS), a primary application of cloud technology, will total $14 billion by 2013. McKinney & Company estimates that AAAS is currently growing at a 17 percent annual rate.
In this interview Kevin Detester, a director in Englanders technology practice, shares his insights on cloud computing and the pros and cons of using a cloud-based Customer Relationship Management system, or CRM. Kevin, it seems keel that most businesspeople have at least heard of “cloud computing,” but it appears a fair number remain a bit unclear on the concept.
Can you enlighten us? In basic terms, cloud computing refers to a delivery model in which software applications and network infrastructure, like data storage or email servers, are provided over the Internet as a service.
Traditionally, these technologies would reside within a company’s server room/data center or on an individual user’s hard drive. With cloud computing, a user located virtually anywhere in the world and operating virtually any device PC, pad, semaphore, whatever – can gain access to information and services via an Internet connection. Then I’m guessing a lot of people who are unfamiliar with the term “cloud computing” are nevertheless already using the technology, right? I mean, wouldn’t having an e-mail account through Yahoo or information on someone else’s computers and then access it via the Internet, you’re involved in cloud computing.
So then why is cloud computing generating so much buzz? One reason is that many companies that have traditionally maintained their IT and data management systems in-house are migrating steadily toward cloud computing solutions.
Growth in cloud-based applications is likely to outpace the growth of on- premise software fairly quickly, particularly among small and medium-sized businesses, or SMB. Many organizations – not only businesses but universities, nonprofits and others – are recognizing the inherent advantages of cloud computing. Such as?
Cloud computing offers a variety of benefits, particularly for organizations that haven’t already made huge investments in IT infrastructure and staff. The managers of a typical start up or SMB have to keep a close eye on cash, so they rather not devote scarce resources to computer hardware, software and IT personnel, if they an help it. Operating from the cloud tends to be the less expensive option, at least initially, since the buyer is charged a relatively small monthly fee instead of the one- time payment common with traditional software licenses.
And in many cases you are charged on a usage basis, which meaner there is little waste; you’re not paying for the software when you’re not using it.
So cost savings are the primary benefit? While many users initially are attracted to cloud computing because of cash flow considerations, that’s not the only reason businesses are migrating to the cloud. Small companies with relatively limited IT resources like it because it empowers them with sophisticated business processes that previously were only available to their larger competitors.
But much larger organizations, including many with substantial IT capabilities, are also taking advantage of cloud computing. What do big businesses find appealing about it? We live in a world where change is constant; even the largest, most powerful corporations have to stay on their toes and be able to adapt quickly to fluctuating conditions. Cloud computing provides an impressive level of flexibility; companies not only can minimize fixed costs but can scale up and down almost immediately, making quick adjustments as workloads increase or decrease. It also can facilitate innovation and rapid decision making.
Are you seeing applications where the cloud option is particularly popular? A wide range of cloud applications are being used by consumers and businesses everything from Poi to online photo management. It’s become particularly popular in situations where collaboration is important and/or where people are geographically dispersed. For example, one application we’re seeing move to the cloud fairly rapidly is CRM. That makes sense, since CRM is used by sales departments, which typically have people located all over the country, and all over the world, for that matter.
True, the use of CRM was pioneered by sales and marketing departments, and they continue to be among the most active users. But we’re seeing organizations use CRM in a variety of departments and disciplines.
For example, we currently are working with municipalities to help them manage a variety of local government functions, such as managing the workflow associated with building permits. Another example is our work in the health care field. We’re helping patient outcomes and overall cost of delivery. I suppose you could call that application “PRM,” for patient relationship management.
Microsoft actually refers to its CRM product, Microsoft Dynamics CRM 2011, as an “CRM” solution to emphasize its applicability beyond Just sales and marketing. Aren’t companies hesitant to store the kind of information typically found in CRM systems on another company’s servers? We’re talking about detailed, proprietary information about current and prospective customers, among other things.
Aren’t they worried about security breaches? It wasn’t that long ago when a lot of business people agreed with you.
Companies that had significant security concerns, or that had fiduciary reporting responsibility, sought hosting providers that carried an SASS 70 report or complied with SEA 16 and ‘SEA 3402 standards. Today, most of the people with whom we consult recognize that the top-tier cloud providers offer levels of security that few organizations can match. That’s not to say there no longer are compliance-related considerations, particularly in areas of the federal government and among organizations with fiduciary reporting responsibilities.
But such considerations exist regardless of whether their IT solutions are on-premise or cloud based. We often help clients analyze compliance requirements and then identify the cloud providers best able to meet their particular needs.
So should every company that’s evaluating a new or upgraded CRM system opt for the cloud computing option? Helping companies select, install, configure, manage and maintain their CRM systems is a big part of our business, and we don’t push our clients toward one particular solution.
Naturally, when a client is evaluating CRM options, one of their key considerations is hither to maintain the technology on premise – that is, license the software and install it on the client’s own systems – or have it hosted by a third party. For some companies, particularly those that already have made substantial investments in IT infrastructure and personnel, going the on-premise route makes sense. Others may have particular tax or regulatory compliance issues that can make the cloud option more challenging.
And on-premise licensing can provide some cost savings over the long term – say, five years or more. But even that is changing as economies of scale are enabling cloud providers to lower their costs.
Frankly, today we are seeing relatively few companies elect to go the on-premise route. The vast majority are electing to have their CRM hosted by a firm like ours or by a cloud provider such as Microsoft. So what are the key factors one should assess when determining whether or not cloud computing is the best option for your organization’s CRM system?
Many of the factors that make cloud computing attractive in general are of comparable importance when evaluating the pros and cons of your CRM options: relatively small upfront costs, the ability to deploy rapidly, the ability to scale up or down quickly, etc. When buying a CRM system, you want to make sure your vendor is stable and reliable; this is particularly important if that vendor will be maintaining your system offset. Another important area to consider is the ability to integrate your CRM with your existing enterprise applications.
Most of the top cloud providers offer good integration capabilities, and it often is no more difficult to achieve this via the cloud than it is to do on-premise.
However, there can be challenges when trying to integrate, say, data from on-premise ERP systems with data from a cloud-based CRM r partner with a firm that can host – and integrate – both applications in the cloud. When assessing your CRM options, is user acceptance and adaptability an important consideration? Do most users find cloud-based systems more difficult to use than on- premise systems?
Overcoming user resistance is a crucial consideration when assessing CRM systems. One of Microsoft’s biggest selling features is the ease with which new users adapt to the Dynamics CRM 2011. The reason: it’s based on one of the most widely used programs in corporate America: Microsoft Outlook. However, hill that may be an excellent reason to select the Microsoft product over a competing system, it’s of little use in helping you compare cloud-based and on- premise options.
Most of the top cloud-based CRM solutions are as easy to use – and in many cases, easier to use – than their on-premise counterparts.
Well, there’s a lot to think about, but it sounds like cloud computing is a very attractive option for a lot of computer applications, including CRM. Any final caveats or suggestions you’d like to share? Take a close look at your service-level agreements (SLAY) to make sure there are no hidden costs that could come back to bite you. You need to be very clear what you are getting – and what you are not getting – in your SLAY.
While this is always a useful exercise, it can be particularly important when purchasing any cloud service. This is perhaps of less concern when dealing with Microsoft; most of its offerings are pretty standard. Salesrooms.
Com, on the other hand, provides a larger array of options. That’s not a knock on Salvatore. Com; having an array of choices can be beneficial. You Just need to carefully evaluate them and know what you’re getting. Http://McGreevy. Com/Bulletins/Computing-in-the-Cloud-Is-it-Right-for-Your- Organization