Enterprise cloud adoption for execution systems is on the rise. Seth Patin has 6 reasons why adopting WMS cloud makes more sense than ever before.
“Cloud” has become a ubiquitous buzzword. You see it everywhere from TV commercials to airport terminals. But how and why can your business benefit from it? If you are asking those questions, you are not alone. Business Cloud adoption is accelerating at a rapid pace as more and more business leaders make the choice to deploy their systems in the Cloud. While there are many reasons for Cloud adoption, the following six cover a number of misconceptions surrounding Cloud and lay out the most clearly advantageous benefits.
6 Reasons Putting Your WMS in the Cloud Makes Sense
1. Wide Area Network (WAN) connections have become both affordable and reliable
One common misconception is that Cloud Services won’t work for your business because the cost of getting a fast enough internet connection would be prohibitive. I just talked with an IT Director in a midsized business last week that told me this. But I beg to differ.
One common misconception is that Cloud Services won’t work for your business because the cost of getting a fast enough internet connection would be prohibitive.
– Seth Patin, President
While enterprise networking can indeed be expensive, every major Internet Service Provider (ISP) in the United States has been rushing to reduce cost and achieve wider spread adoption. AT&T ran their enterprise Fiber network to our Wisconsin office building at a very reasonable cost in the interest of expanding their Fiber network. They also offered us rates that are certainly not “cheap,” but also not anywhere near unreasonable. Time Warner Cable also offers us very affordable pricing on high bandwidth cable-based data services. Cable connections have a very reasonable cost and their reliability has become extremely good. If all your users simply connect to a web server, you may not even need the more expensive enterprise Fiber services for the majority of your data needs.
I used AT&T and TWC as examples because we use their services, but, as I said, every major US ISP is reducing rates and improving speeds. Many manufacturing plants and warehouses are in relatively remote areas where infrastructure development trails behind larger metropolitan areas, but even in remote areas, internet connectivity has improved exponentially in the last decade. The internet has become ubiquitous and small to midsized businesses should aggressively explore the many options available for the best cost to performance ratio.
2. The management costs and risks of having a different server in every facility are untenable
Especially in warehouse management software (WMS) deployments where warehouses are located in relatively remote locations, I still see companies deploying individual servers at each site. Often this approach is taken because it is believed the cost of a better connection to the internet is unaffordable. But even if the internet connection would be expensive, let’s also examine the additional costs of decentralized deployment.
First, deploying servers at every site requires secure and reliable infrastructure at every site. Building a room with security controls, non-water fire suppression, dedicated cooling, and backup power is usually costly. More often than not, those environmental considerations are not addressed at all, introducing a much higher risk of hardware failures or security breaches. In addition, IT management of those servers requires either the hiring of local IT resources or site-to-site travel of IT resources, both of which are costly. Finally, each site must have multiple servers and networking devices to provide redundancy, so instead of having multiple sites served from one larger server with a single larger backup, every site must have its own hardware, which drives up cost dramatically. Unfortunately, many companies do not purchase this redundant hardware, leaving them highly susceptible to disruption from hardware failures.
When added together, the cost of extra IT staff, additional building enhancements, and redundant hardware at every location can come to tens or even hundreds of thousands of dollars. Alternatively, minimal IT interaction with the hardware, limited environmental protection for it, and no backup if something fails present an even higher cost when a failure cripples your business at the worst possible time. When compared to the marginally higher cost of a superior internet connection and the added cost of a Cloud provider, the cost and/or the risk of distributed internal deployment usually doesn’t add up.
3. Data may actually be more secure in the Cloud than in your office
The only 100% foolproof way to keep data safe is to store it on a server that is not even connected to the internet. Once your server is connected to the internet, it becomes a possible target and data security becomes a very relevant concern. According to numerous Cloud adoption reports, the number one concern preventing Cloud adoption is data security. This concern is underscored by the numerous high profile business security breaches reported every year. Most people assume these breaches are the work of expert hackers, but more often than not, they are the result of much less technical attacks such as a hacker using social networking to guess that your user set their password to the name of their cat or hackers tricking your employee into opening malware from an infected email or website.
When a computer on your network is infected with malware, it can infect other computers on your network, but it cannot infect your Cloud-based solutions. Furthermore, Cloud service providers typically leverage industry-leading security solutions and employ security experts to keep your data secure. This means your data sits behind a firewall that no socially engineered password guessing or malware laden emails will penetrate. When compared to many small and medium enterprise controls, the security measures employed by Cloud services providers are actually stronger than measures taken internally. Before assuming Cloud is a security risk, I would recommend examining your company’s security procedures and compare them to that of a potential Cloud provider. You may be surprised by the results.
4. The cost of building and managing your own datacenter is often more expensive and risky than leveraging Cloud services
Large businesses have been leveraging centralized data management for decades. In doing so, they have been reducing their IT costs and risk by centralizing their IT resources and leveraging technologies that allow them to utilize their servers more efficiently and reliably. To the technology companies that mastered building their own data centers, it became clear that passing along those cost savings and risk mitigation to other companies by offering to sell access to those data centers became a great way to make money and the Cloud Services business model was born.
Most small and medium enterprises do not have enough servers to justify large data centers and do not have enough regular IT projects to justify multiple IT experts. The end result is a tendency to have servers deployed in closets with minimal environmental management supported by IT generalists who support daily business needs, but are not experts in any one solution. For the companies that do invest in building a data center and hiring experts, costs quickly accelerate to hundreds of thousands or even millions of dollars.
Regardless of which approach your business uses, the cost of designing, building, and maintaining your own Cloud—or the risk of hardware failures due to weaknesses in environmental controls, lack of redundant hardware, and inability to expertly debug a failure—can both be limiting to growth and present unexpected challenges at the worst possible times. By comparison, the right Cloud provider can provide your company with the best of both worlds: IT experts to manage your servers and solutions in an enterprise data center, with the lowered cost of only using the IT experts when you need them and paying for only a small fraction of the cost to build the datacenter and fill it with servers. Cloud deployment provides small and medium enterprises with the same technology tools as large businesses, thereby providing the ability for SMBs to compete with much larger companies and on a much larger scale than previously possible.
5. Most Enterprise applications are designed with Cloud deployment in mind
Many business leaders believe that purchasing enterprise software in a Cloud deployment means they cannot customize the application to their business needs and are forced to the “cookie cutter” approach. While many software companies do place this limitation on their Cloud offerings, the reality is that configurability and customizability are vendor-specific factors, not limitations of the deployment model. Today most enterprise applications are designed with Cloud deployment in mind and they offer extensive configurability to enable multiple business process in multiple locations or operations. Furthermore, most enterprise software vendors also have a software architecture that is designed with extensibility in mind.
Configurability and customizability are vendor-specific factors, not limitations of the cloud deployment model.
– Seth Patin, President
In addition to feature support, concerns are often expressed about solutions performing more poorly in Cloud deployments. This was more true for older application architectures that employed highly data-intensive client-server architectures, but modern enterprise applications are moving from dedicated client applications installed on a computer to a browser-based user experience that is designed to perform much better over the internet. Software vendors recognize that ease of Cloud deployment is expected of modern business solutions and have built their solutions with Cloud in mind.
6. Cloud gives you access to the same tools that make it easier for your business to grow
At Accelogix we have fully featured business automation and productivity applications from enterprise software vendors such as Microsoft, Oracle, Atlassian, and Axosoft. Microsoft Exchange, for example, is quite complicated to administer and requires expertise to install and manage properly. We could not afford to keep an Exchange expert on staff to manage an internal deployment of such a mission critical platform. With Office 365, Microsoft has enabled even the smallest businesses to have access to all the same communication tools that used to be available only in much larger organizations. We also leverage other tools that we would not want to deploy internally and can only use because a vendor made them available in the Cloud.
Today Tier 1 ERP and Supply Chain Execution software is moving to the Cloud as well, enabling businesses to leverage the extensive capabilities of software solutions that would once have been unattainable. If your company is growing and you want to lay a solid foundation for the future, it is now possible to start small with the same solution you would buy down the road and grow into the solution rather than buying a solution that will clearly need to be replaced later on. In the end, you can get more features now and save money in the long term when your business avoids the cost and disruption of switching solutions.
Utilizing Cloud Services Reduces both Cost and Risk
In my opinion, the real question when thinking about whether to put your systems in the Cloud is not “Why should I put my systems in the Cloud,” but rather, “Why should I NOT put my systems in the Cloud?” At Accelogix, we have some systems in the Cloud and we have some systems on our internal servers. When evaluating a new system, we always look to Cloud options first, and only choose to bring the solution onto our servers if there is a significant feature unavailable in the Cloud or if the cost is simply unaffordable. I would recommend that other small and medium business leaders take a similar approach. If IT is not your core competency and you do not sell IT solutions, the cost of building servers and the risk of not being an expert in managing them are significant. Relying on Cloud Services providers to keep your systems running allows you to reduce cost and risk while focusing your company’s energy on the product or service that makes your company successful.
Learn more about Accelogix Cloud here!
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