Convergence of IT and OT: Transforming conventional ERP

Ganesh Devle

INDIA: Today’s ERP has to improve an IT organization’s alignment with the business rather than force the business to fit its processes into a portfolio of applications. IT organizations feel the need to innovate and implement flexible systems to support and automate new processing capabilities for business agility. These systems should facilitate global visibility, process efficiency and standardization. In the midst of this, the cloud has become deep-rooted in many businesses.

There are so many different cloud systems available, including cloud-based ERP. This system is quickly becoming popular within businesses. Cloud based deployment of applications in a SaaS type of mode eliminates the need for an organization to buy, install and maintain packaged applications on its hardware alleviating the burden of maintaining software, ongoing operations and support.

Likewise, Cloud-based ERP solutions are simply a suite of ERP apps that are delivered to users over their Internet connection, usually accessed via a browser. The benefits derived out of such deployments can help in increased ERP performance, decreased operating costs, enhance access to information, increase security and keep on the continued 24/7 support.

With these applications undergoing transformation, the industry is interested to witness how cloud based ERP deployments evolve with customizations and other integrations

ERP continues to be a critical enterprise application in the IT portfolio of manufacturing enterprises for day-to-day operations, with an ever increasing demand on performance and functionality with cost pressures.

The maximum workload is also taken up by ERP among enterprise applications. It is the top ranking area of investment in the short term for small & medium enterprises. But large enterprises have already made significant investments and are planning their budgets to keep the system upgraded, maintained and running efficiently. This makes it an interesting phase in the adoption of ERP in the country, especially on the cloud.

As cloud based deployment of applications in a SaaS type of model becomes mature and organizations feel comfortable in adopting it, critical applications such as ERP and supply chain planning will see more deployment on the cloud. Sometimes demand from the ecosystem to extend the ERP to suppliers and partners in the ecosystem will push the need for a cloud based deployment using a 2-tier approach.

The core ERP stays as such on premise. But a lighter ERP on cloud synchronized with the core enables flow of necessary information outside the enterprise. External collaboration brings in the focus on security. Security continues to be an area of concern and organizations should have consistent policies for all components of the ERP application.

With the convergence of IT and OT (Operations Technology), ERP and its associated enterprise IT applications are undergoing transformation in the type of information they store, their functionalities for business processes and integrations for information flow across the enterprise and its ecosystem. As these applications undergo transformation, it will be interesting to see how cloud based ERP deployments evolve with their out-of-the-box features, customizations they need to undergo and their integrations. Additional checks and balances such as bundling of security along with the SLAs, local regulations for data ownership in cases where the cloud setup is outside a country and awareness of terms and conditions for termination of a contract are some points that need to be taken care of.

The backbone of every business application platform for most midsize organizations is ERP. The need to synchronize tasks and data, provide consolidated analysis, leverage single-view attributes and support spanning business processes all remain critical. However, for many midsize organizations, ERP and the associated strategy, have become too slow-moving and unchanging. Today a different construct that supports business agility is needed.

There are thousands of so called ERP experts out there. But the truth is no one understands your business like you do. You may be one of the few that has reviewed and evaluated ERP programs extensively before. But, odds are that it’s probably been a few years, and the ERP landscape is rapidly changing. It’s impossible to stay on top of the constantly changing landscape of the ERP software industry, and that’s something we’ve experienced first-hand.

ERP continues to be a critical enterprise application in the IT portfolio of manufacturing enterprises for day-to-day operations, with an ever increasing demand on performance and functionality with cost pressures. The road map for ERP in the medium to long term is critical for organizations. Cloud based deployment is an attractive option that should definitely be on the check-list for decision makers.

Many enterprises struggle with the high cost of ownership of a single instance ERP strategy. Initiatives around business process re-engineering drove and coincided with the inception of a single instance ERP. At the time, enterprises had few other choices in their quest for standardization of ERP processes between their headquarters and subsidiary locations.

The lighter ERP on cloud provides deployment at a fraction of the cost and time of on premise alternatives; enables real-time visibility and control over distributed financials and operations. seamlessly synchronizes with on premise ERP at HQ; dramatically improves business agility and time to value and equips subsidiaries with flexibility to meet local requirements.

(Ganesh Devle is Head of Global Delivery, Invenio Business Solutions. The views expressed here are personal and CyberMedia does not necessarily endorse them)