Cloud ERP is a critical strategic tool that can revolutionize a business. It is transforming chief financial officers into chief future officers by offering real-time financial performance insights, enabling new capabilities, and disrupting how their organizations operate. Cloud ERP dramatically improves CFOs’ abilities to plan, manage risk and forecast financial scenarios. More than ever, it allows financial leaders to influence strategy and drive their organization’s success.
Since the pandemic, cloud ERP deployment has entered a second wave — one that is more measured and strategic. Whereas first-wave ERP systems often fell short of expectations, second-wave systems generate real value. The ERP system is no longer just a generic tool for procurement, HR or other administrative functions; it has matured into a strategic imperative.
This article is the first in a two-part series recapping key takeaways from our recent webcast about the impact of second-wave cloud ERP migration and how organizations can use it to build compelling strategies and transform their organizations.
Read part two of this cloud migration series: Overcoming Challenges to Building Your Cloud Migration Strategy
Strategy Redefined: How Cloud ERP Is Revolutionizing Business
If the first wave of ERP implementation was akin to an old-style cell phone — a useful but limited and inflexible tool — the second wave is like a smartphone, unleashing the tool’s full potential. Second-wave ERP systems are more versatile and agile, allowing organizations to adapt to rapidly evolving strategies and operating models. They support and encourage innovation rather than constraining it.
Second-wave ERPs can improve operational efficiency and customer satisfaction and potentially boost revenues. They cost less and are easier to configure and update, while better accommodating remote work — a post-pandemic necessity.
Cloud ERP is also a key enabler for operating model optimization and finance transformation. Along with standardized, improved processes and automation, these cloud-based systems can expedite the closing process and provide consistent, near-real-time data — a “single source of truth” that increases accuracy, efficiency and speed.
Second-Wave Systems Move at the Speed of Business
In contrast to on-premises ERP migration that can sometimes take years, cloud implementations can be completed more quickly thanks to preconfigured workflows and built-in industry best practices. Cloud implementations are easily scalable, enabling organizations to expand into new markets and territories — moves that were frequently constrained by the limitations of old-style on-premises ERP systems.
Contemporary systems are rapidly expanding the frontiers of business. They are opening up new realms of opportunity and innovation and reshaping corporate processes and strategies. They enable low-code and no-code development, empowering workers without coding skills to develop, build and customize applications. These days, they typically include AI and machine learning, deriving greater business intelligence from the wealth of data that organizations collect and improving process efficiency by optimizing inventory acquisition and labor scheduling.
Organizations are integrating cloud ERP systems with other technologies, such as the Internet of Things (IoT) and third-party AI-driven applications, to streamline and automate core processes, improve the customer and employee experience, and greatly expand business visibility, both internally and externally. For instance, ERP systems integrated with mobile scanners and smart conveyors can track the location of goods within a warehouse (SAP). Additionally, AI-driven predictive maintenance technology integrated with an ERP system can help reduce downtime and save costs (Precise Business).
Organizations are increasingly adopting cloud-based vertical-specific applications, such as e-commerce systems in retail and enterprise risk management in financial services. These can be integrated with cloud-based ERP platforms to improve data flow and operational efficiency, linking sales directly to fulfillment, inventory, accounting and customer management (Netsuite). Vertical-specific applications typically embed industry best practices to optimize the organization’s return on investment.
Finally, by connecting the ERP with social media, organizations are getting a clearer understanding of their market so they can improve their marketing and customer experience.
In the next article, we’ll share expert guidance on how you can overcome key implementation challenges, accelerate time to value, and maximize your ROI.
Is a cloud ERP migration part of your business strategy? Let’s talk!