When Switching Over to a Cloud ERP...

Why You Must Start with an Original Cloud Strategy!

Pat Garrehy, CEO, Rootstock Software

Too many manufacturers and distributors, when moving the computer operations to the cloud, lack an overall cloud strategy. As a result, they end up with various cloud-based point solutions, deploying multiple cloud applications on different cloud platforms and then try to tie them all together with expensive and difficult to manage “middleware”.

Although there is a multitude of cloud-based technologies available to replace legacy solutions, it is not advisable for these companies to simply throw cloud tech at various problems. Such organizations have forgotten that developing a cloud strategy should ensure interconnectivity and communication between their growing numbers of cloud-based apps and platforms in use in the back office. Cutting-edge capabilities, such as analytics, IoT (Internet of Things) and AI (artificial intelligence), are more complicated to implement and integrate when doing so across disparate clouds.

If you are in the process of evaluating Cloud ERP (or any other major app for that matter), you need to understand the strengths and weaknesses of the underlying cloud platforms as touted by ERP software developers. Use the words “cloud platform” loosely here because the ERP software industry now labels everything a “platform” whether it really is or not. Elaborate PowerPoint slides from software vendors illustrate technology components artistically stacked on top of one another, all encased in a beautiful cloud.  But how can you tell what is a real, holistic platform versus a clever diagram of a traditional software stack? Or, how can you tell the difference between a real cloud architecture versus marketing “slideware”?

Oftentimes, what you are viewing is the modern manifestation of what used to be called “islands of information” in the old on-premises computing world where companies would have multiple, separated systems with multiple customer records strewn around. Unfortunately, history is repeating itself. Cloud applications, such as CRM, HR, finance and operations, have crept into companies residing on different cloud platforms, usually on a department by department basis. Many companies have allowed departments or functional leads to deploy a mixture of cloud applications. In effect, they have created their own bolted together monster. With very few rare module exceptions, this practice should be avoided.

When a company deploys multiple cloud applications on different cloud platforms, each cloud uses different tools for reporting, workflow, customization and integration. Unfortunately, some early cloud adopters have done just that and assembled multiple cloud applications with different databases, master records, user interfaces, reporting tools and technical underpinnings.  The clouds usually have different user interfaces and are not integrated with each other very well. Worst of all, the databases are separated, making reporting and analytics more difficult. Concepts like the “360-degree customer view” and the “single version of the truth” are difficult to attain. They’ve created the same fragmented data monster from the on-premises days, albeit in multiple clouds.

If you find that you have had problems with separated systems and data in the past, this a time when you can get it right and not let history repeat itself. For instance, the last time you selected and implemented ERP, you probably thought of it as separate from CRM, but that has changed.  Leading research firms, such as Gartner and Forrester, now think of the system of record and the system of engagement as one and the same.

Unifying CRM and ERP
If companies want to become more customer-centric and efficient, the Lead to Cash process is a high-volume, critical process that crosses marketing, sales, operations and finance departments while touching your customer multiple times. It should be thought of as one process if you want to be more capable, agile, provide great customer service and manage cash more effectively. It is clear that a unified approach across CRM and ERP is the way to accomplish that.

For instance, Salesforce CRM was one of the first cloud applications adopted at many companies. There are thousands of complementary applications available on the Salesforce platform that share the same infrastructure, system administration and tools etc., including Rootstock’s Cloud ERP application. So, try to limit cloud proliferation and take advantage of the cloud platforms you already have in place.

Furthermore, companies no longer can afford to compete just on price or products features. They need to compete effectively on service too. Call it the Amazon effect or the result of global competition but the competitive game has changed for manufacturers and distributors alike. The customer experience across all business functions needs to be unified and enabled by a 360° view across ERP and CRM.     

Salesforce paved the way for the potential we see for Enterprise applications in the cloud today...first for Sales Automation, then CRM and, now, cloud platforms.  Salesforce cracked the code on how to provide multi-tenanted applications that can be individualized by anyone, yet still be upgraded and refreshed with new releases easily (unlike legacy ERP).  Salesforce turned this into a wider platform that other software developers could leverage, creating an ecosystem of enterprise applications that work together on their platform, not unlike the applications in the Apple App Store that all work on the iPhone.

Software applications such as ERP can co-exist with the Salesforce CRM data model and use the treasure chest of tools including workflow, reporting, Chatter (social media), Slack, artificial intelligence and advanced analytics.

Create a Clear Cloud Strategy
Most companies could do themselves a favor by establishing a clear cloud-platform strategy. Years ago, companies would standardize on a hardware, operating system and database technology stack to help combat this problem. Today, companies should think about standardizing on a cloud platform that can help eliminate the integration, data fragmentation, system administration and multi-toolset problem.

For instance, CRM, Field Service, Quality Management Systems, ERP and others should all be on the same platform and share the same data model. CRM and ERP house the bulk of the data, the biggest processes and a large user population. Combining CRM and ERP on one platform goes a long way to solving the majority of the problem. This is a particularly beneficial strategy for the manufacturing sector to optimize forecasting and more seamlessly share sales and production information.

Taking a platform approach allows manufacturers and distributors to obtain a holistic view of the complete lifecycle between buyer and supplier in the supply chain, arming organizations with data that can be used within the enterprise, as well as between business partners, to strengthen collaboration initiatives. Real-time data exchange between finance, sales and operations teams, for instance, can help manufacturers minimize inventory and enable just-in-time production. Interconnected apps allow for a well-rounded view of the customer experience, which can, in turn, support a stronger bottom line.

And, overall, the adoption of an integrated platform approach to cloud migration supports the kind of agility that many product centric organizations found themselves lacking. Looking ahead, agility will continue to be more important than ever to ensuring that supply chains flow smoothly.

Operational agility is a manufacturer's or distributor’s ability to adapt to change. If a company wants to switch to a new product line, how quickly can they do it? Ramping up a product is only part of the equation. The cloud, when adopted strategically, can fill in the blanks to optimize all aspects of operations.


About the Author - Pat Garrehy is CEO for Rootstock Software. Rootstock Software is a worldwide provider of cloud ERP on the Salesforce Platform. When combined with Salesforce CRM, Rootstock Cloud ERP offers manufacturing, distribution and supply chain organizations a single platform to grow and manage their businesses. Rootstock Cloud ERP is a flexible, modern and digitally connected system that transforms companies to deliver a more personalized customer experience, efficiently scale operations and out-service the competition.