By Arun Khehar, SVP Applications ECEMEA, Oracle
Emerging markets have a lot to brag about. Compared with historically dominant economies, they have a lower cost of doing business, expanding middle classes, steady economic growth, and easy-to-access modern infrastructure—from gleaming universities to advanced technology.
Still, businesses operating in emerging markets face huge hurdles as they expand beyond their borders and plug into the fast-moving, digitally-driven global marketplace. Common challenges include complying with a wide spectrum of regulations, innovating as they grow, and keeping data and operations secure.
Our emerging-market customers are using ERP to address these challenges, but it’s not yesterday’s ERP they are using. They’re building tomorrow’s finance function with today’s ERP in the cloud.
As emerging-market companies grow, they must comply with new and changing regulations at all levels (country, regional, industry, line of business). Material handling, accounting, hiring, electronic payments—these and other core functions can have different regulations in different places. Noncompliance is a risk that could harm a company’s revenue and reputation, and result in fines and fees.
This burden of compliance is driving cloud ERP adoption, according to Constellation’s 2018 survey of CFOs: 42% of respondents highlighted regulatory compliance as a top priority. Because cloud ERP is continually updated, businesses can stay continually fresh on all fronts as they expand: compliance, technology, workforce, location, acquisitions, etc.
They can also stay up-to-date on the latest best practices and breakthrough technologies. Advances such as blockchain, intelligent helpers and process automation, and predictive analytics engines all require the compute, storage, and data-management resources that only the cloud provides. Yesterday’s ERP simply can’t handle them.
Having access to the latest best practices and innovations on a continual basis is fairly new to finance leaders, but it has emerged as an overwhelming benefit of moving ERP to the cloud. An astonishing 81 percent of respondents to our Oracle ERP Top Trends survey cited this benefit.
Successful businesses innovate at all levels (business models, processes, decisions) based on market changes happening in real time. This is how they stay ahead of fast-moving competitors that can change the game in a matter of days or weeks vs. months.
Yesterday’s ERPs does not support distributed innovation. Oracle realized this when we made the strategic decision several years ago to offer complete ERP and EPM solutions in the cloud, knocking down technology, process and reporting barriers while providing the same core functions that businesses needed.
To fully understand the leap in value from early ERP applications to tomorrow’s ERP cloud, think about the Mini, the iconic small economy car originally made by British Motor Corp. The Mini has evolved over the years, and the various models have had different owners and influencers. All of those versions are Minis, but they are not equivalent cars. Today’s BMW MINI models are more powerful and technologically advanced than the prior generation.
Cloud applications are the same way: Today’s are better than yesterday’s. The first generation helped businesses by:
Yet most early cloud ERP models were not true software-as-a-service, with updates delivered by the provider on a regular basis. Instead, they were newer, shinier versions of on-premises ERP delivered over the internet. The customer was still responsible for purchasing the software license, maintaining and patching it, and undergoing upgrades every few years to get access to new functionality.
Many of today’s “cloud ERP” providers — including some of Oracle’s largest competitors — still follow this model.
By contrast, Oracle ERP Cloud is true software as a service (SaaS). Patching, maintenance and upgrades are a thing of the past; Oracle provides those services as part of your monthly subscription. And with regular updates rolled out every quarter, a move to Oracle ERP Cloud is the last upgrade you’ll ever need.
In addition to ERP, Oracle provides a connected, intelligent-ready cloud for the entire business—from digital back-office to digital front-office. These applications draw on the same up-to-date and unified data stream, and can be customized with advanced technologies and tools.
Instead of investing in a single-point cloud ERP application, growing businesses can have a total platform that touches every level of the business. This way, they are prepared for challenges and changes today and tomorrow.
Security concerns are a common barrier to speeding up cloud adoption, but security technology is constantly evolving and becoming more effective. For example, Oracle has just announced the industry’s first cloud-native, intelligent security and management suite. This new set of integrated suites—Oracle Security Operations Center (SOC) portfolio of services and Oracle Management Cloud—will help all types of businesses forecast, reduce, detect, and resolve cybersecurity threats.
Another frequently cited objection to modernizing ERP is cost, but such a move can actually provide 3.2 times the return-on-investment (ROI) of on-premises applications, and 52% lower total cost of ownership (TCO).
In addition, the “combinatorial effects” of technologies such as machine learning, blockchain, mobility, cloud, and the Internet of Things (IoT) are exponentially improving performance and productivity. This happens when these advanced technologies work in tandem and far exceed the capabilities they have when deployed separately.
Consider this supply chain management example: IoT-networked sensors can provide real-time insight into the provenance of goods and materials, supplier performance, available capacity, predictive demand, and other key data. In turn, this data can feed autonomous, intelligent processes that “learn” how to respond to changing circumstances. Cloud ERP is what brings the data and action together, reducing non-value-adding work and freeing up humans for more attention to core values.
Also, with cloud, the risk of technology obsolescence drops to zero—putting the business on a more solid competitive footing.
Finally, businesses can’t really say that moving to cloud ERP is just too much of a hassle.
Using the deep experience of the 3,000 customers that are live on our ERP-EPM Cloud solutions, we have designed a new program to secure your transition to the cloud. SOAR includes innovative tools to automate the move to Oracle ERP Cloud, making for a simple upgrade and quick return on investment.
It will be the last ERP upgrade you’ll ever need, and for businesses in emerging markets, it’s an upgrade that helps them face today’s challenges and position their companies for whatever tomorrow brings.