Two years ago, I wrote an article for SandHill on Cloud ERP system considerations — would talk of whether manufacturing ERP systems can run effectively in the cloud ever be replaced by discussions of when SaaS ERP will be the norm? Having spent considerable time working on SaaS applications for traditional manufacturing processes since writing that article, I thought I’d share some realities from that experience.
Since then, at least two companies have emerged as pure SaaS ERP players and most established ERP vendors have a cloud offering (or at least, a cloud strategy). Early innovators of manufacturing cloud ERP tend to be small or medium-sized businesses that have already placed a bet on other SaaS offerings. Their first inclination is to seriously look at traditional ERP products that are now being offered in the cloud. Guess what they are finding.
While support has always been a key component to traditional ERP success, many cloud ERP providers gloss over it
There has been a lot of hype regarding cloud ERP. For instance, customers have been told that, since the software is in the cloud, they can expect their SaaS applications to be easy to implement and deploy. Reality check — manufacturing ERP systems are complex, even in the cloud, and carry a high level of support requirements.
Cloud prospects have been reminded of how traditional, on-site ERP software systems have been, and continue to be, difficult to implement. There a large number of installation considerations, training issues and process changes and improvements. The documentation must be very detailed. Help at the field level is imperative. Help at each business process, explaining how the system functions, is also essential.
Traditional ERP providers know this and have responded. Videos are now becoming effective training devices and are readily available. Emails, online chat and even phone support are all facilitated by having a direct customer interface to a customer’s data. In sales calls, they emphasize their training and technical support, stressing their call centers, multiple support shifts and intensive training. Many SaaS vendors forget to acknowledge these support requirements.
Cloud ERP also needs to be supported by the platform
Let’s take just one example of why. MRP processing — the most computer-intensive process — needs to be completely redesigned for the cloud. That is because PaaS (Platform as a Service) often places limits on queries and CPU usage. As a result, traditional methods of processing need to be revisited to fit into the constraints of the platform. In other words, the platform must support large processing tasks without impacting traditional queries and updates. MRP is just one issue. Other manufacturing processes such as capacity planning and shop floor scheduling can also be challenging in the cloud for many of the same reasons.
Customer support in the cloud
Nonetheless, cloud ERP vendors have an advantage over traditional on-premises ERP vendors in helping their customers. Regardless of the customer being able to troubleshoot — with a single-instance approach — the SaaS vendor is able to better assist the client with issues. That’s because the software should be exactly the same for each client, regardless of whether there are 10, 100 or 1,000 instances.
Database corruption, hardware and software compatibility and version issues are a thing of the past. (Customizations can be handled more easily but should be kept separate so that the above features are kept clean.)
Advantages for the customer include:
- The software is exactly the same for all clients. There is no need to figure out the version or follow a complicated set of remote login instructions.
- Complete logging of transactions gives visibility into how data is updated.
- The database structure is exactly the same with the exception of custom objects and fields.
- Since the business logic is not available for update by the user, there is no chance to pollute the basic software.
- Debug flags can be set at the user level without affecting all users.
- The business logic is contained in fewer places — typically on database updates.
What kind of support should the cloud ERP customer expect?
Let’s looks at some of the above features in more depth and how they can help customers.
Consistent user interface — Business logic cannot be touched by the user. Things like field-level help, data integrity checks and validation are all built into the system. Therefore, programs behave consistently.
Implementation — The customer is afforded complete online documentation. Videos can provide step-by-step instructions. Processes can be documented and stored along with traditional ERP data. Workflows, which reflect specific business practices, such as purchase-order approvals, can be established. All of this, of course, requires knowledgeable provider personnel.
Test cycles — Testing has always been a grind in the ERP world. There are typically a large number of settings that affect the behavior of the system and each must be checked. That’s true in the SaaS world as well. Because the software is released on a regular cycle, SaaS vendors must ensure that the software is well tested. Customers should make sure that their SaaS vendor does this. After all, multiple test points and multiple sign-offs lead to a more reliable system. Complete documentation of all changes can also alert the customers to new features, enhancements and bug fixes.
New releases — SaaS software is released on a regular basis with no need for the user to do anything. This is a major advantage of a cloud ERP. Database updates are seamless, unlike traditional on-premises systems, which often require an entire unload/reload of the database.
Database changes — Both clients and vendors can make updates to the data model. Customers are restricted in the kinds of changes that can be made, but an ERP package in the cloud should always allow for additions of new fields and new objects without affecting the standard package.
Frequency — New updates occur much more frequently in the SaaS world. Things change rapidly. New functionality and bug fixes happen much more quickly in this environment. This impacts the vendor as well as the client. The vendor must make sure that the documentation reflects any changes and changes must be rigorously tested to ensure that nothing breaks. Cloud ERP prospects should check out — with current customers if possible — how their provider handles these changes.
Patches — Software patches are necessary in SaaS implementations as well. Vendors must provide a quick and seamless method for delivering fixes in a timely fashion. Patches must be tested thoroughly, as they will impact all customers.
Custom fields – Custom objects — Customization is a fact of life in the ERP world because every customer is different and has some unique needs. Most ERP software has room for customizations. In the SaaS world, these customizations are part of the platform and should be completely independent from the vendor’s software. Vendor updates should not affect these extensions. Custom reports and inquiries should also remain separate.
Thus, it only stands to reason that more evaluation and analysis must be spent to determine how easy it is to customize and add enhancements to the proposed cloud ERP system. New public cloud platforms such as Salesforce’s Force.com offer significant advantages for IT departments to easily provide their own customizations to ERP cloud software written natively on the public cloud platform.
Recognizing that there is a significant difference and benefit to the open systems on a public cloud, IT management can make informed decisions on which cloud ERP solution will provide a quicker payback and higher return on investment, especially when considering that those latent customization projects can be controlled by the customer rather than the software provider.
Documentation — Documentation should be part of the product, available to the user as part of the screen layout. Help fields for all data elements should be readily available.
Don’t disregard the importance of support
Before signing on the bottom line, the customer should check, preferably with current users of the system, whether or not the SaaS provider helps with the implementation process.
Customers should be assured that knowledgeable personnel are provided and communication between them and the provider is done interactively. They should check if the provider has a self-service Web portal for reporting issues and provides updates on bugs and enhancements.
Implementation in the SaaS world still requires attention. There are certainly benefits that come from the cloud, but ERP systems still require a high degree of support and training from the vendor.
Martin R. Browne has worked with manufacturers and in manufacturing software for his entire career. At ASK Inc., Marty served as vice president of development for almost 20 years. He is widely known as the “Father of MANMAN,” ASK’s product. He is currently a senior manufacturing consultant with Rootstock Software, bringing manufacturing expertise to the cloud.