ERP uptake set to boom as risk diminishes – research

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ERP uptake set to boom as risk diminishes – research | Business Cloud News

enterprise IT rolloutA new survey provides potentially exciting news of lucrative opportunities for cloud service providers. Nearly a third of all enterprise resource planning (ERP) systems in the world will attempt the migration to the cloud in the next two years, if a study commissioned by Hitachi Solutions Europe is accurate.

With rare cloud migration skills at a premium, the mass migration could prove lucrative for experts in this area, according to Hitachi.

The managers of ERP systems have been the most reluctant of all IT users to move to the cloud, according to Tim Rowe, Director of Hitachi Solutions Europe. The importance of this foundation system and its inherent complexity have dissuaded companies from taking any risks. However, as perception of the benefits of cloud computing spreads, the pressure to move is beginning to outweigh the resistance to change, said Rowe. The complexity of ERP systems, once a sales blocker, is now set to become a massive source of margin, according to Hitachi.

“Now we are starting to see a shift as the benefits start to outweigh the perceived risks,” said Rowe.

The survey found that that though 31% of organisations have moved all or part of their ERP systems to the Cloud, or are in the process of doing so, that leaves a healthy 69% who are still keeping ERP in house. However, 44% of the survey group of 315 senior finance professionals

said they would contemplate moving into the cloud in the next two years. If this is an accurate representation of global sentiment, then in the next two years around 30% of all ERP systems will begin an expensive migration to the cloud.

Among the companies with 500 employees there was just as much enthusiasm for taking a Cloud-based approach to ERP. With 27% of this demographic saying they have moved all or part of their ERP to the Cloud, or are in the process, the proportion is roughly similar to the overall average (31%).

Enterprises conducting feasibility research, through peer reviews, will be encouraged by the feedback given by earlier adopters, according to Hitachi. Its study found that 80% of their survey group of finance professionals rated their experience of using cloud-based ERP as excellent or good.

The main blockages to cloud based ERP projects will be data security and privacy risk (ranked as the top concern in 38% of cases) and dependency on a third party provider, nominated as the top fear by 35% of respondents.