The Role of ERP in a Cloudy World

A recent article in E-Commerce News raised the question as to whether SAP has become a liability to many businesses (It's not just SAP but any of the traditional legacy ERP systems) because of their size and rigidity. The point is made that SAP springs from the age of manufacturing, which could live with rigidity, and we are now in an age of services, which call for very different styles of information systems - styles that require flexibility and mobility.

The idea is that the newer cloud based systems meet the needs of modern service based businesses and mark the way of the future.

A lot of truth in all that. However, what that argument ignores is the extent to which SAP and other ERP providers have already ventured into the cloud. True, their core product is still based on system ownership in the traditional sense, but they have been moving strongly into cloud services in recent years. If I were an IT manager, and saw the need for some of the power and flexibility of the cloud, I would sure look at finding ways to extend my system into the cloud before I'd throw my ERP system out the door. Making such a major move is very high risk, the investment to get my ERP into place was major and I need to be sure that the transition to the cloud is seamless as possible. In fact if we learned anything from the rash of ERP installations of the 80s and 90s, it was that transitional failures can be incredibly costly! It works both ways. It seems to me that retaining my core system and implementing cloud capability through such vehicles as SAP's HP Enterprise Services' Cloud Platform collaboration makes a lot of sense. And I'm sure the users would be grateful for the lack of disruption in their jobs that would surely ensue from a wholesale change.