Flex your cloud-enabled ERP - IBM Business Operations Blog

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The world of cloud-based enterprise resource planning (ERP) systems is ever-evolving. For some finance operators, investing in the right ERP system, or a cloud-based counterparts, can be a tough decision.

In IBM Consulting’sfinance transformation practice, our consultants encounter many finance organizations that realize the importance of modernizing their ERP systems. Yet still some see it as a heavily convoluted effort, and not one they’re willing to dive into without guidance. They let their system age, and the total cost of ownership (TCO) rises. It might feel like there’s never a “right time” to undertake modernization. But the right time was yesterday.

Other, braver organizations and finance operators eagerly take a go at implementing cloud-based ERP systems on their own, but they fail to unlock the greatest possible value of these capital-intensive projects. Integrating these systems in a way that delivers enterprise-wide value will require alignment with peers and stakeholders. Moreover, making solid ERP purchasing decisions and implementing them effectively requires core ERP competencies and a clear understanding of how to limit cloud cost waste.

Huddling around the virtual water cooler with finance operations and transformation gurus has revealed one thing for sure: IBM Consulting knows too well that it can be daunting for organizations and their stakeholders to effectively embark on this process. We’ve seen the ERP decision paralyze customers with on-premise ERPs, and we recognize what it takes to move to a cloud-based ERP system.

After you’ve done your due diligence, you’re ready to implement and scale. Make sure you have explored modern ERP options and identified that these will yield the desired benefits. Then partner with finance transformation consults to assess the feasibility of implementing the new system. Last, enable and empower your team to take on the new transformation and accept a new operating model.

During this process, you should recognize that ERP transformation is less about choosing a specific technology and more about choosing the right technology to achieve desired outcomes. Consider these insights when identifying new and enhanced ERP systems, and set goals for current and future business needs to help realize the value of a cloud-enabled ERP.

ERP is an essential part of a business and IT strategy. It’s the backbone that connects all aspects of a business. With a cloud-enabled ERP, you can:

For many organizations, the top consideration is operational efficiency. No matter what the starting level and regardless of the sophistication of the ERP, the suite of available options can be tailored to help meet identified needs. Moreover, the digitization of critical processes will allow businesses to propel and improve how technology is used. This allows for greater value realization and incremental investment throughout the journey as processes are refined and workforces are enabled to manage the new ERP system.

Cloud computing can make organizations more competitive. But an estimated 32% of cloud spend is wasted. To reduce TCO and minimize the cost of implementing systems, many organizations partner with finance transformation experts.

If you’re among the few who have completed or earnestly kicked off an ERP deployment on your own and have realized planned savings and ROI, kudos, you are well on your way. If not, working with a partner with core ERP competencies will help you address unforeseen integration and value realization challenges. Keep in mind that a cloud-first approach reigns over on-prem these days — because it can also help improve your finance organization’s agility and time-to-value.

It’s also advisable to get help exploring many valuable cloud-enabled ERP applications that can help with broader system adoption. Whether it’s an Oracle Cloud Infrastructure (OCI) or another, the ideal approach is a solution that can be set up in a matter of weeks (from plan to complete) with expert advice from your business transformation consultant.

As we’ve personally seen from our clients, once you get buy-in from critical stakeholders and peers, you can rapidly accelerate the modernization effort and often see lower TCO, increased agility and improved productivity.

Clients often come to IBM Consulting with an aging on-prem ERP solution. With their on-prem warranty nearing end-of-life, an IBM Consulting client in the mining industry set out to migrate their ERP landscape. In this particular case, they partnered with IBM to deploy Oracle E-Business Suite, enhance analytics, implement multiple non-production builds — including upgrades for their operating systems and data base — and migrate their service-oriented architecture (SOA) applications to OCI.

Their commitment to the adoption of a sustainable and scalable cloud mode helped them eliminate mundane tasks. Not only did this lead to a significant reduction in TCO, but this client also realized a notable improvement in the health of the overall operations. In addition, by using intelligent workflows and artificial intelligence (AI), this client achieved a 34% cost saving and 75% improvement in ancillary benefits.

Another client in the business intelligence and publishing industry considered attempting an ERP migration on their own. After long internal deliberations, they chose to engage a consultant instead. They uncovered greater value after IBM Consulting helped them migrate multiple environments from on-prem to cloud. By accelerating their migration to cloud, they improved system reliability and performance in just under three and a half months — well ahead of their anticipated date of completion.

The combination of cloud, data and emerging technologies (such as AI) is radically reshaping business processes into intelligent workflows. But those that operate in a silo tend to experience more challenges and may fail to realize the synergies between these advancements. Increasingly, the tight collaboration of CTO, CFO and CIO needs to come to bear given that many IT organizations lack the financial management capabilities to fully measure and manage cloud value.

Enterprises of all sizes and industries can extract the most value from a new ERP once the system has been implemented. For example, by leveraging intelligent workflows, you can further modernize and take advantage of continuous innovation to meet the ever-changing technology landscape.

Getting started is a challenge. One way ERP clients are deriving value quickly and at scale is through use of IBM Garage Jumpstart sessions, which provide a framework for accelerating their digital and finance transformation. These serve as a convenient platform for generating innovative and relevant ideas. In my experience, we can bring in the practice leads, technologies and experts to help turn those ideas into business value in a matter of weeks.

The level of engagement in these sessions is exciting. Customer pain points come into focus and teams are empowered to take calculated risks. As we’ve witnessed, clients who come in fully educated and engaged in the adoption of leading technologies like cloud-enabled ERPs are bound to achieve their desired outcomes. We help speed up solution development and measure and quantify that value.

In 2022 IBM was named a Leader in the 2022 Gartner® Magic Quadrant™ for Oracle Cloud Application Services, Worldwide. Our team of finance transformation consultants can help you successfully implement and flex your new cloud-enabled ERP.