Over the last two years, there has been a lot of buzz about Cloud Computing. In this article, we will examine how Cloud Computing technologies are a paradigm shift in the way Internet can be used and how it will help SMEs address some of the issues related to adoption of Information Technologies.
Several surveys have concluded that adoption of IT products in Indian SMEs is significantly lower as compared to their western counterparts. Following are some of the reasons for this situation:
- Non IT enterprises find it hard to hire and retain capable IT manpower to manage their infrastructure
- IT infrastructure (both hardware and software) is perceived to be expensive
- Lack of considering IT infrastructure as strategic to enterprise growth and success
- Relatively lower skill level and proficiency of staff in using IT systems
Cloud computing, offers elegant solutions for issues listed above. One of the most important benefit of Cloud computing is that it eliminates the need for an enterprise to create and maintain it’s IT infrastructure (both hardware and software).
Using the Infrastructure as a Service (IaaS) offerings in Cloud, enterprises can rent infrastructure for their requirements. The Cloud Service Provider (CSP) take care of managing the infrastructure and maintaining it’s uptime as per the Service Level Agreement (SLA). The user enterprise is relieved of
the need for hiring IT staff for managing the infrastructure (often a non-core activity for the enterprise).
Software as a Service (SaaS) offerings from CSPs provide a hassle free option to procure enterprise software. These days, it is far cheaper and cost effective to use hosted email service providers (like Google, Microsoft etc.) instead of setting up own corporate email servers. The same consideration can now be applied to enterprise software like ERP systems.
One aspect that holds back many Indian SMEs from adopting a fully integrated ERP solution and instead continues to use popular accounting software is the “build versus buy dilemma”.
Many enterprises believe that they have unique requirements and attempt to use customized software to fulfil their requirements. However, this can be a very torturous experience. Custom software development is expensive, time consuming and a diligent activity. Both the software developer and the enterprise have to commit substantial resources in terms of time and people to make this a success.
A right strategy for SMEs would be to evaluate a Cloud ERP product and start by adopting the product as-it- is rather than focus too much on customization. This will reduce the cost of acquisition and speed up deployment and adoption. Once the system is in use, it can then be refined and fine- tuned incrementally as you go.
At OfficeBOX (R) , we have been pursuing this philosophy for enabling Indian SMEs adopt Cloud ERP as a strategic infrastructure for their growth and success. We have built a sophisticated configurable Cloud ERP product that can be useful to a wide ranging businesses like C&F, retail and manufacturing.
Founder and CTO, OfficeBOX