Is It Now the Right Time to Migrate Enterprise Systems to the Cloud?

Is It Now the Right Time to Migrate Enterprise Systems to the Cloud?

Guo Chao Alex Peng (Information School, The University of Sheffield, UK)
DOI: 10.4018/978-1-4666-5888-2.ch102
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Background: From On-Premise To Cloud-Based Erp

ERP systems can be defined as an enterprise-wide information system package, which consists of a comprehensive set of software modules that aim to support and integrate all key business processes across various functional divisions (e.g. sales, production, purchasing, accounting, and human resource) of an organisation by using a single data repository (Peng & Nunes, 2012).

Conventionally, ERP systems are installed and hosted internally by user companies in their own servers (this is so called on-premise ERPs). This on-premise approach, which is still prevalently adopted by modern organisations to host and deploy their ERP systems, however has some inherent disadvantages (Mangiuc, 2011). In particular, an on-premise ERP will generally require user companies to invest substantial financial and human resources to purchase, install, maintain and improve the software package and related IT facilities (e.g. servers, hardware, and any necessary facilities to run it) (Mangiuc, 2011). When companies (especially large and multi-national companies) have a high number of ERP users, installing and constantly upgrading the software package on the PC of each user will be very costly and time consuming. These disadvantages embedded in on-premise ERPs are expected to be significantly improved with the support of cloud computing technologies.

Key Terms in this Chapter

ERP Risks: The occurrence of an ERP-related event that can lead to negative effects to user companies.

Cloud ERP: ERP systems that are hosted by a third-party cloud vendor and can be accessed by companies as on-demand services through a web browser.

On-Premise ERP: ERP systems that are installed and hosted internally by user companies in their own servers.

ERP Benefits: Advantages, opportunities and returns brought by the adoption of ERP to user companies.

ERP: An enterprise-wide information system package, which consists of a comprehensive set of software modules that aim to support and integrate all key business processes across various functional divisions of an organisation.

Cloud Computing: An advanced IT model that allows organisations to use a pool of IT resources and applications as services virtually through the web, without physically holding these computing resources internally.

ERP Challenges: Difficulties, barriers and issues associated with the adoption of ERP.

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