ERP Questions- Many more CFOs and their teams are considering moving their company’s core financial systems to the cloud, according to Gartner’s 2018 Magic Quadrant report on the segment. If you’re one of those companies evaluating its cloud ERP (enterprise resource planning) options, make sure you’re asking the following six questions before selecting a platform.
1. Is It a True Cloud?
Business processes today are different from those managed by on-premises software systems developed a decade or more ago. When moving all or part of your company’s ERP system to the cloud, make sure that it takes full advantage of cloud capabilities.
“Legacy ERP vendors that are making a transition into the cloud often resort to hosting their solutions in the cloud rather than taking the effort to completely rewrite them for the cloud,” says Juergen Lindner, vice president of cross-SaaS product marketing at Oracle. “While that’s one way to become a cloud vendor, it’s not going to be the future-proof type of platform that companies will need, because those applications simply won’t be able to keep up with the pace of change.”
2. Is the Vendor Financially Stable?
If your cloud ERP vendor goes out of business, what happens to all of your critical financial data? And if your vendor’s product includes components from third parties, what happens if one of those vendors goes belly up?
Of course, if your cloud ERP vendor is a publicly traded company, its financial statements are readily available for inspection. Not so if the company is owned by a private equity firm, which may be more interested in “propping up” the company for a potential sale than investing in R&D, Lindner says.
3. What’s the Product Roadmap?
To the point in question #2, if your cloud ERP vendor doesn’t invest sufficiently in product R&D in this era of continuous digital innovation, it will leave you and other customers “further and further behind as time goes on,” Lindner says. “The technology gap will widen exponentially.”
This is a particular concern about ERP vendors that have acquired other companies to boost their market share rather than bolster their core product line. What is the roadmap for those components?
“Public companies have well-articulated roadmaps so that customers can see the company’s vision and if it aligns with their strategy, and public companies report on their R&D investments,” Lindner says. “But private companies don’t have that transparency.”