More and more large organisations are looking to tap into the benefits of managing their enterprise resource planning (ERP) and human capital management (HCM) systems in the cloud. They are increasingly focused on using cloud to support their business’s current and future growth.
These enterprises are looking for the flexibility, scalability and operational efficiencies that migrating to the cloud can bring. They expect new implementations will drive agility and the ability to cut costs and manage budgets more efficiently. Often, however, they are disappointed by the ‘out of the box’ implementations that they receive and the integration challenges they experience.
Infor’s Inforum 2019: Embracing agile for ERP success
Frequently, the process of migrating is harder than they thought, especially if this is their first journey to the cloud. However good the technology they are using, it is never enough in isolation. Migrating to a cloud-based ERP/HCM solution, is likely to require significant business process re-engineering, which is often neglected. Organisations that think they can they can replicate their legacy processes in a new cloud solution will find that such an approach will not deliver the business outcomes that they were looking for.
They are often unaware of the size and complexity of the project they are embarking on before they start. They struggle to align process with technology and find it difficult to consume cloud in the new world. If process re-engineering and a holistic view of the full cloud lifecycle have not been considered fully, issues frequently persist beyond implementation. One of the biggest mistakes is organisations failing to fully scope the post ‘go live’ world which includes regular testing cycles, change costs, training and release management.
Without suitable planning, update cycles can be a major issue. As standard, there are new mandatory updates to cloud applications that come in at regular intervals. These leave businesses with just a small window of time in which they can adopt new functionality or test the existing scope of what they use.
The need to factor in these regular cloud management activities means that businesses often fail to take into account the total cost of ownership. The result of missing this crucial phase in the business case is that once they are live, companies either have to go back for further investment, or they stick with their original investment then struggle to manage the continual evolution that cloud involves. Consequently, they completely miss the benefits cloud is predicated on.
Even where organisations have a strong, mature IT model for supporting cloud applications, there are likely to be parts of the deployment that are niche specialist areas, such as staying abreast of the latest release functionality, performing impact assessments and testing before the release.
The new definition of human capital management
Ultimately then, moving to the cloud does not in and of itself solve problems for businesses. Problems are only solved when enterprises align processes and technology during the implementation and then continue that with a robust, business-as-usual cloud management approach that does then result in delivery of the desired business outcomes.
It is in this context that a managed services approach can help organisations. The best providers can act as an extension to the business’ IT team, offering everything that they may need in the form of an “as a service” model. These models should be flexible enough to cater for companies who are new to cloud as well those with more mature cloud strategies.
As the maturity of the cloud journey progresses in an organisation, the managed service should transform from one of supporting stabilisation and embedding of robust processes for release management and testing, through the adoption phase of new functionality, to the mature stage of optimisation. In optimisation, the managed service partner will often be helping the organisation drive continual improvement and helping the internal IT function deliver true business value back to the functions they are serving.
By aligning their technology investment with efficient business processes and a robust post go-live cloud management approach, organisations can drive the value that HR, finance, procurement and payroll departments can then deliver to the business.
At times of uncertainty like we see now with Brexit, by looking at their processes and improving them through a managed services methodology, organisations can free their functional teams to focus on the pressing issues as opposed to the administration. It is a great example of how businesses can reap the rewards of this kind of approach to managing ERP and HCM in the cloud.
