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How have you partered with IT who might be opposed to the Cloud move for major systems? How did you avoid "stepping on their toes"? (Webinar Attendee Question)

This question was asked by an attendee during the Proformative webinar "A CFO Story: When It's Time to Upgrade Financial Systems & Do it Right - Hello Cloud Accounting" held on November 1, 2012.

A video of this webinar can be viewed here: https://www.proformative.com/resources/webinar-video-cfo-story-when-its-time-upgrade-financial-systems

Answers

Chuck Boecking
Title: Open Source ERP and Business Intelligenc..
Company: Chuck Boecking
(Open Source ERP and Business Intelligence, Chuck Boecking) |

FYI - There is a big difference between Cloud and SaaS ERP. Cloud ERP is using cloud resources to ensure a globally and highly-available system. You can host almost any ERP in the cloud to gain these benefits. Amazon's AWS makes this easier. SaaS ERP means that someone is hosting and controlling the application for you.

I typically resist SaaS ERP for larger companies. The infrastructure for SaaS ERP is amazingly expensive. I can think of no other application where users demand more from a single application. More in terms of:
* Number of concurrent users
* Strict need for privacy and security
* Varity of tasks performed
* Dependency for uptime
* Requirement for backup and disaster recovery
* Desire for customization
* Access to data
* Coupling with other systems
* more...

If you are a small company with 20 or less users, you will probably find great success with SaaS products like NetSuite. You will appreciate the simplicity of the application. You will enjoy the canned process to turn purchase orders into material receipts. For the first time, you will be able to enjoy connecting your people and processes together to eliminate double and triple data entry. At $40K for the go-live and $20K per year in recurring license, you can justify the cost because your payroll expense goes down by at least that much. Such is the promise of ERP- right?

If you are a medium company with between 30 and 300 users, the above bliss will quickly turn to frustration. The canned processes are now creating bottlenecks for your receiving processes. Your inability to make changes to the system is causing your users to export to excel and manipulate data outside of the system. Your month close process becomes more difficult because your operations no longer tie nicely to the general ledger. You become dependent on adapters to connect external tools to your data. The incremental cost per user starts to negatively impact growth and change initiatives. SaaS ERP quickly become your biggest expense next to payroll.

I hope this helps!

Chuck Boecking

Scott Travasos
Title: CFO
Company: Blue Shield of CA Foundation
LinkedIn Profile
(CFO, Blue Shield of CA Foundation) |

Because our IT department had already vetted and approved the force.com platform it was a non-issue. That's why I am a big fan of choosing your platform of choice, and buidling off it.

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