erp on a cloud

7/26/2019 ERP on a Cloud

http://slidepdf.com/reader/full/erp-on-a-cloud 1/12

T forManagement



CONTENTS

WHAT IS ERP (ENTERPRISE RESOURCE PLANNING)?

…………………………………………..…….….2

ERP SOFTWARE MODULES

…………………………………………………………………………………………………...

………2

WHAT IS CLOUD?

………………………………………………………………………………………………….

.….…....3

How orga!"a#!o$ %a a&& 'a* #o #+*!r ,$!*$$ $!g ERP o a

Co&? ................................-

How #+* T*%+oog

wor/$? ......................................................................................................

…...................0

Co& ERP

S$#*1$..................................................................................................................

...............…..........................0

a) P,!% Co& %o1#!g

…………………………………………………………………………………………………………….

…..0,) Pr!'a#* Co& Co1#!g

…………………………………………………………………………………………..………..…….

…..0%) H,r!& Co& Co1#!g

……………………………………………………………………………………….………………….

…..0

T+* Maag*r!a

I$$*$C+a*g*$ ........................................................................................

......…………....4

R*5*r*%*$ ..................................................................................................

......................................................…....67

1



What is ERP (enterprise resource planning)?

Enterprise resource planning (ERP) is an industry term for the broad set of

activities that helps an organization to manage its business.

One important goal of ERP is to facilitate the o of information so that business

decisions can be made data!driven. ERP softare suites are built to collect andorganize the data from various levels of an organization to provide managers

ith insight into "ey performance indicators (#P$s) in real time.

ERP softare modules can help an organization%s administrators monitor and

manage inventory& supply chain& procurement& 'nance& product lifecycle&

proects& human resources and other mission!critical components of a business

through a series of interconnected eecutive dashboards. $n order for an ERP

softare deployment to be useful& hoever& it needs to be integrated ith other

softare systems the organization uses. *or this reason& deployment of a ne

ERP system in!house can involve considerable business process reengineering&

employee retraining and bac"!end information technology ($+) support for

database integration& data analytics and ad hoc reporting.

ERP softare is considered an enterprise application as it is designed to be used

by larger businesses and often re,uires dedicated teams to customize and

analyse the data and to handle upgrades and deployment. $n contrast& small

business ERP applications are lighteight business management softare

solutions& customized for the business industry you or" in.

ERP Softare Mo!ules

-



ERP softare typically consists of multiple enterprise softare modules that are

individually purchased& based on hat best meets the speci'c needs and

technical capabilities of the organization. Each ERP module is focused on one

area of business processes& such as product development or mar"eting.

business can use ERP softare to manage bac"!o/ce activities and tas"sincluding the folloing0

istribution process management& supply chain management& services

"noledge base& con'gure& prices& improve accuracy of 'nancial data& facilitate

better proect planning& automate employee life!cycle& standardize critical

business procedures& reduce redundant tas"s& assess business needs& accounting

and 'nancial applications& loer purchasing costs& manage human resources and

payroll.

2ome of the most common ERP modules include those for product planning&

material purchasing& inventory control& distribution& accounting& mar"eting&'nance and 3R.

s the ERP methodology has become more popular& softare applications have

emerged to help business managers implement ERP in to other business

activities and may incorporate modules for 4R5 and business intelligence&

presenting it as a single uni'ed pac"age.

F!gr* 68 ERP S$#*1

n ERP system can either reside on a centralized server or be distributed acrossmodular hardare and softare units that provide 6services6 and communicate

7



on a local area netor". +he distributed design allos a business to assemble

modules from di8erent vendors ithout the need for the placement of multiple

copies of comple and epensive computer systems in areas hich ill not use

their full capacity. ERP is a massive softare architecture that supports the

streaming and distribution of geographically scattered enterprise ide

information across all the functional units of a business house. $t provides the

eecutives ith a comprehensive overvie of the complete business eecution

hich in turn inuences their decisions in a productive ay.

ERP referred to the ay a large organization planned to use its organizational

ide resources. *ormerly& ERP systems ere used in larger and more industrial

types of companies. 3oever& the use of ERP has changed radically over a period

of fe years. +oday ERP can be applied to any type of company& operating in any

"ind of 'eld.

What is Clou!?4loud computing is the delivery of computing services over the $nternet. 4loud

services allo individuals and businesses to use softare and hardare that are

managed by third parties at remote locations. Eamples of cloud services include

online 'le storage& social netor"ing sites& ebmail& and online business

applications. +he cloud computing model allos access to information and

computer resources from anyhere that a netor" connection is available.

F!gr* 28 Co& Co1#!g

4loud computing provides a shared pool of resources& including data storage

space& netor"s& computer processing poer& and specialized corporate and userapplications.

9



"o organi#ations can a!! $alue to their

%usiness using ERP on a Clou!?

:y moving ERP systems to the cloud& companies can gain an assortment of

technological and business bene'ts. Enterprise $+ is embracing cloud!based ERPfor many reasons& including0

&oer upfront costs '

4loud computing substantially reduces the capital epenses incurred by an

enterprise in order to implement an ERP system or to sitch to a ne

cloud!based one. +he part of the upfront costs that is mainly reduced

includes epenses for hardare& user licenses and implementation&

ecluding user training and customization. +his bene't is generally

considered to be more important for 25Es than for large enterprises.

&oer operating costs '4loud!based ERP loers operating costs for energy& maintenance&

con'guring& upgrades& and other $+!sta8 costs and e8orts. +his bene't is

generally considered as having increased relevance for 25Es.

Rapi! implementation'Rapid implementation is generally agreed to be among the top bene'ts of

cloud!based ERP. $t could also contribute to easier change of cloud service

providers and reduced time of providing ne products in certain types of

business.

Scala%ilit'Resource pooling and rapid resource elasticity of cloud!based ERP ma"e

the infrastructure capacity highly elastic. +hat in turn enables faster timeto mar"et& high level of strategic eibility and improved competitiveness.

+his feature is reported as a possible advantage that is particularly

relevant for 25Es in competing ith large rivals.

ocus on core competencies'4loud!based ERP and other enterprise applications allo focusing the

resources that ould be used to maintain an $+ department on other

essential areas of business. $n some cases it mainly results in reduced

pressure on internal $+ department hich can focus on servicing core

competencies.

*ccess to a!$ance! technolog'4loud!based applications often enable access to specialized technology

and advanced computing re!sources that otherise ould have not been

accessible to 25Es.

Rapi! up!ates + upgra!es'4loud!based ERP systems usually get faster updates and ne functionality

than traditional ERP systems.

Impro$e! accessi%ilit, mo%ilit, an! usa%ilit':esides their inherited features of mobility and accessibility cloud!based

ERP and other enterprise applications can usually boast higher levels of

user friendliness and usability than other types of ERP.

Easier integration ith clou! ser$ices'

;



<sing bene'ts of 2aa2 shared infrastructure& companies that adopted

cloud!based ERP may get relatively inepensive integration ith other

cloud services once respective cloud providers have integrated their

infrastructures.

Impro$e! sstem a$aila%ilit an! !isaster reco$er'

$n many cases 2aa2 providers ensure measures such as bac"up routines&fall bac" and recovery procedures& conditioned poer etc. of higher ,uality

than most 25Es do in!house.

• vailability of more robust& feature!rich ERP cloud applications from

established and trusted enterprise softare vendors.

• Ease of deployment.

• Pay for only hat you use.

• =eed to shift $+ investments from the capital budget to the operating

budget to closer align business bene'ts ith cash outo.

• *ree valuable resources from maintaining legacy softare and

infrastructure to focus on higher!value and innovation!driven activities.• >uic"er deployments leading to faster time to value and freeing up

resources for more strategic initiatives.

• 5ore eible and scalable solutions to provide long!term support for

groth and epansion.

• s more enterprise applications reside in the cloud& having a cloud!based

ERP system can simplify integration and eliminate data silos.

:usinesses are realizing that the cloud is the future of enterprise softare and

o8ers many attractive business bene'ts. mong the most compelling are0

• 5ore modern user eperiences (<?s) that increase productivity andemployee satisfaction.

• Embedded analytics to support more e8ective real!time business

decisions.

• Embedded social collaboration tools to increase collaboration and

productivity.

• Pervasive mobile access to application services.

• Ease of 'nding and sharing information to support collaborative decision

ma"ing and increase productivity.

• <ser self!service to simplify provisioning and system administration.

•bility to more e8ectively tie bac"!o/ce systems into the front o/ce tosupport the company%s customer eperience strategy.

• Eliminating data and people silos to ma"e more e8ective business

decisions more ,uic"ly.

• $mprove and shorten the 'nancial close process through better access to

data and embedded collaboration.

• :alance the company%s 'nancial needs beteen capital and operating

budgets.

*or midsize companies on a fast groth path& there can be additional bene'ts

from ma"ing an informed and strategic decision hen it comes to ERP systems.

Often these companies choose something that is scaled don too much instead

of choosing a fully mature& enterprise!class ERP system. @hile such a system

A



might 't today& it on%t "eep up ith the rapid change that occurs in groing

businesses. $n e8ect& businesses are re,uired to go through to implementation

processes& hich they could have avoided by selecting a system ith the

eibility& scalability and headroom to accommodate their groth.

"o the Technolog or-s?

Clou! ERP Sstems

4loud computing& as an innovative distributed computing& can provide dynamic

resource bu8er& virtualization and highly usable net generation of enterprise

data centre. @ith cloud computing& the resources are shared and so are the

costs. <sers can pay as they go and only use hat they need at any given time&

"eeping cost to the user don. 4loud computing is very much a business model

as ell. Providers of cloud computing solutions& hether they are softare&

hardare& platform& or storage providers& deliver their o8erings over the $nternet. +here are no shrin" rapped boes containing discs or hardare for you to buy

and set up yourself. 4loud providers typically charge monthly recurring fees

based on your usage.

+he cloud computing can be categorized as Public 4loud& Private 4loud and

3ybrid 4loud as de'ned belo0

a) Pu%lic Clou! Computing' +he cloud infrastructure is made available to the

general public or a large industry group and is oned by an organization selling

cloud services.

%) Pri$ate Clou! Computing' +he cloud infrastructure is operated solely for an

organization. $t may be managed by the organization or a third party and may

eist on premise or o8 premise.

c) "%ri! Clou! Computing' +he cloud infrastructure is a composition of to

or more clouds (private& community& or public) that remain uni,ue entities but

are bound together by standardized or proprietary technology that enables data

and application portability (e.g. cloud bursting for load!balancing beteen

clouds).

B



F!gr* 38 T*$ o5 Co& Co1#!g

+he services provided by the cloud service providers can be collected into three

categories0

a) S**S' 4loud application services or 62oftare as a 2ervice (2aa2)6 deliver

softare as a service over the $nternet& eliminating the need to install and run

the application on the customer%s on computers and simplifying maintenance

and support.

%) P**S' +he CPlatform as a serviceD covering a layer of softare and presents it

as a service that can be used to construct higher!level services. $n other ords&

the capability provided to the consumer is to deploy onto the cloud infrastructure

consumer!related or ac,uired applications created using programming languages

and tools supported by the provider. +he consumer does not manage or control

the underlying cloud infrastructure including netor"& servers& operatingsystems& or storage but has control over the deployed applications and possibly

application hosting environment con'gurations.

c) I**S' 4loud infrastructure services or 6$nfrastructure as a 2ervice ($2)6

delivers computer infrastructure& typically a platform virtualization environment

as a service. Rather than purchasing servers& softare& data center space or

netor" e,uipment& clients instead buy those resources as a fully outsourced

service. +he service is typically billed on a utility computing basis and amount of

resources consumed (and therefore the cost) ill typically reect the level of

activity. $t is an evolution of virtual private server o8erings.



ERP softare that is deployed into a cloud environment becomes 64loud ERP

2oftare6. 5ost (if not all) cloud environments are built using virtualization and

load balancing technology that allos applications to be deployed across

multiple servers and database resources. 4loud ERP is positioned as a

revolutionary approach to deploy an ERP solution. $t provides a solution that is

eible& adaptable& scalable& e/cient and a8ordable.

ERP as a business management softare has provided big success to deliver

business critical data. ERP softare as a service (2aa2) is provided for customers

ho ant to ac,uire ERP ithout managing hardare& softare& and upgrades

hile reducing up!front epenses. 4ustomers can build an internal cloud to

reduce ongoing hardare costs hile maintaining greater control over

integration and re,uire local access to their data server.

Softare.as.a.Ser$ice (SaaS) is often referred to as on!demand or hosted

applications hich can be used in the enterprise resource planning systems.

2aa2 vendor advertently ta"es responsibility for deploying and managing the $+

infrastructure (servers& operating system softare& databases& data center space&

netor" access& poer and cooling& etc.) and processes (infrastructure

patchesFupgrades& application patchesFupgrades& bac"ups& etc.) re,uired to run

and manage the full solution. 2oftare as a service features a complete

application o8ered as a service on demand. single instance of the softare

runs on the cloud and services multiple end users or client organizations.

2oftare!as!a!2ervice (2aa2) may also be described as a process by hich

pplication 2ervice Provider (2P) provide di8erent softare applications over

the $nternet leveraging cloud infrastructure on Cpay!as!you!goD pricing structure. +his ma"es the customer to get rid of installing and operating the application on

on computer. $t also eliminates the tremendous load of softare maintenanceG

continuing operation& safeguarding and support. +he great bene't of 2aa2 is the

ability to run the most recent version of the application.

+he 2aa2 softare model has 'ed 'nancial and operative advantages over the

others in on!campus softare models. +he operation cost is very less and the

subscription cost is also lo& normally far cheaper than a licensed application fee

hich is possible due to its monthly fees based revenue model. @ith 2aa2

rchitecture& a provider licenses an application to customers on subscriptionbased service delivery. $t allos customer to re,uire a computer or a server ith

internet access to donload the application and utilize the softare& hich ma"e

customer to get rid of purchasing epensive hardare F softare to run an

application. $t also allos the softare to be licensed for either a single user or

for a hole group of users.

The Managerial Issues/Challenges

Su%scription e0penses

H



n eplicit part of cloud!based ERP additional costs is idely used periodic

subscription fees that do not depreciate over time& in contrast to capital

investments in traditional ERP softare.

Securit ris-s2ecurity and con'dentiality ris"s are reported to be among the top

concerns about cloud!based ERP. 2ecurity ris"s of cloud ERP adoption areusually more important for large enterprises than for 25Es.

Performance ris-sIeaving out pure integration issues& performance ris"s of cloud!based ERP

are essentially related to threatened speed and reliability of netor"&

outage ris"s and limitations on data.

Customi#ation an! integration limitations

5any cloud!based ERP systems have noticeable constraints on

interoperability ith home!gron applications and integration into eisting

application portfolios and $+ infrastructures. <nli"e on premise and hosted

ERP& cloud!based ERP may not allo etensive customization and comple

integration ith some third!party services and systems. t the same time

this issue is referred to as of less importance for 25Es.

Strategic ris-sOutsource such a business critical system as ERP& companies usually bear

increased strategic ris" of high dependency on the service provider.

Compliance ris-s

4loud!based applications often face additional di/culties in complying

ith data& energy and environmental standards as these regulations are

generally designed ithout regard to peculiarities of cloud computing.

&oss of IT competenciess a result of outsourcing the maor part of $+ support& organizations may

lose some valuable $+ competencies as ell as face their $+ departmentJs

resistance toards organizational changes. +hese e8ects of cloud

adoption are generally considered as more important for large enterprises

than for 25Es.

unctionalit limitations

4loud ERP is based on not that mature systems as traditional ERP and may

not be functionally rich enough to Csatisfy the bac" o/ce needs of

organizations in every type of industryD.

&imitation on h%ri! !eploment strateg4loud!based ERP usually has substantial limitations on hybrid deployment

strategy that may be re,uired to ($) retain legacy systems if needed& ($$)

integrate ERP ith on premise systems that re,uire lo latency and ($$$)

overcome de'ciency of public netor" infrastructure.

S&* issues

$n many cases it is rather hard to accurately de'ne 2ervice Ievel

greements (2Is) negotiated beteen cloud service provider and their

corporate clients. +hese 2Is usually do not really cover such aspects as

con'dentiality and integrity leaving space for unclear damage liability.

1K



References'

6. +##8www.a%a&*1!a.*&29999::;**<#$=a&=Draw,a%/$=o5=Co&>

;a$*&='*r$$=Tra&!#!oa=ERP=S$#*1$

2. +##8www.*r$o5#war**w$.*#%o&>*r>$o5#war*>!1*1*#a#!o>,*$#>

ra%#!%*$$#+a$+.G04wR@".&5

3. +##8www."&*#.%o1+ow>#+*>%o&>!$>go!g>#o>r*!'*#>*r>a&>+ow>

og>!#>w!>#a/*>9777764927

-. +##8www.a%1a#!%a.%o1a&!gw+a#>!$>%o&>*r>$o5#war*

:. +##8www.a,*r&**.%o1r*$*ar%+94:9ra>*#*rr!$*>r*$or%*>

a!g%o#*#.a$

0. +##8www.!5or1a#!ow**/.%o1w+!#*a*rI5ra$#r%#r*N*#wor/>

S$#*1$>Maag*1*#

11

http://www.academia.edu/2777755/Benefits_and_Drawbacks_of_Cloud-Based_versus_Traditional_ERP_Systems


http://www.erpsoftwarenews.net/cloud-erp-software-implementation-best-practices/#sthash.G68wRQpz.dpuf


http://www.zdnet.com/how-the-cloud-is-going-to-reinvent-erp-and-how-long-it-will-take-7000018720/


http://www.acumatica.com/landing/what-is-cloud-erp-software

http://www.aberdeen.com/research/7857/ra-enterprise-resource-planning/content.aspx






http://www.acumatica.com/landing/what-is-cloud-erp-software





erp on a cloud

Documents