Saturday, September 8, 2012
What's This Cloud Thing Anyway?
Was recently putting some thoughts together on the tipping point for a business to finally make the plunge and replace their ERP system and it seems that many "experts" and "articles" like to include the cloud or "The Cloud" in this discussion. Recalling an event where Oracles' Larry Ellison expressed his opinion of the the cloud.
"The interesting thing about cloud computing is that we've redefined cloud computing to include everything that we already do. I can't think of anything that isn't cloud computing with all of these announcements. The computer industry is the only industry that is more fashion-driven than women's fashion. Maybe I'm an idiot, but I have no idea what anyone is talking about. What is it? It's complete gibberish. It's insane. When is this idiocy going to stop?" Full remarks
So what is this cloud thing anyway? And specifically related to ERP or business management systems? I think that it breaks down into two simple concepts. The first, my application can be accessed from anywhere and the second, some or all of my software/hardware investments have been outsourced.
Accessed anywhere simply means that if the internet can be accessed, my ERP can be accessed. This is done through a VPN, Citrix, RDP connection; natively through the ERP client or a browser based application with user authentication. Big surprise, nothing really new here. Access of this type has been around certainly longer than "free" internet access at every coffee shop on the planet.
Outsourced software/hardware - certainly a newer concept, but not the outsource part. Businesses have been outsourcing aspects of their operations for as long as there have been businesses. Anybody still doing their office cleaning? So with "cloud ERP" one end of the spectrum would be having a 3rd party facility provide a rack space (no real pun intended) for the ERP server. At the other end of the spectrum is a subscriber relationship where the vendor provides all of the software and all of the hardware. With any outsource relationship, the customer calculates the internal costs and compares them to the outsource price, then picks the one that makes the most business sense. And as anyone who has spent time selling outsourced services can attest - everyone has a different opinion.
Outsource hardware is fairly new, but not so new that it hasn't been commoditized already. Outsourced software, while there certainly has been some enabling technology, is really just a pricing model that's been around since the beginning of time.
Put me in Larry Ellison's camp - "It's compete gibberish".
But if you're wondering if your business has reached the tipping point and its time to consider next generation business management solutions - OpenSurge would be delighted to help.