Increased Efficiency and Productivity through Cloud ERP

By Mark H. Nestor, Associate Provost and CIO, University of the Sciences

Mark H. Nestor, Associate Provost and CIO, University of the Sciences

My father spent a significant part of his career as an IT Director and Global Infrastructure Architect for a Big 3 accounting firm. Early on, his challenge was to get a large number of data centers located in numerous countries to communicate with one another. The task of getting disparate legacy systems separated by great distance to exchange information was extremely challenging. Toward the end of his tenure, he was responsible for reducing the firm’s number of data center locations. Why pay to maintain dozens of server farms when you can do the same work with a handful?

"Smaller institutions now have access to the same platforms used by large state colleges, research universities, Fortune 500 companies and Silicon Valley giants"

He told me a story that instead of a swear jar, his group used to have a common sense jar. Whenever someone on the team made a statement that made too much sense to be ignored, but probably would be anyway, they put some cash in the jar. At the end of the year, they had enough money to take the entire team out to a fancy dinner.

In a way, I see my job as picking up where his left off. I think it’s entirely possible that before I retire, we’ll see the elimination of local infrastructure altogether. But the hurdles my father faced are the same that those of us who would seek to migrate to the cloud are facing today, and typically they have little to do with technology. Culture, trust, inertia, and capital investment are among the most commonly cited barriers.

Measured Migration to the Cloud

At the University where I work, we’ve moved at a measured pace toward the cloud. Over the past five years, we’ve migrated a vast network of systems, ranging from our learning management system, calendaring system and institutional advancement customer relationship management system to lecture capture, student email and productivity and digital signage onto hosted Software-as-a-Service (SaaS) solutions. In some cases, there were financial incentives for the move and significant efficiencies were realized. In other cases, the solutions were cloud-based from the start. In nearly every case, non-technology barriers presented the greatest obstacles.

Limited Options for ERP

The next hurdle for us, however, is likely to be by far the most challenging. It also has the potential to be the most rewarding. Like many other small and medium sized colleges and universities, options for enterprise resource planning and student information systems historically have been limited. Some were built in house. Most were limited to a handful of commercial vendors. Ours is a typical legacy system, similar to that which is in place at thousands of other institutions.

After having spent about three decades committed to the current paradigm, we find ourselves painted into the proverbial corner. Time spent maintaining these systems– customizing, upgrading, integrating, patching, debugging, backing up, etc. have come at a significant cost. This cost, sometimes paid to expensive consultants because affordable in-house talent has been difficult to hire and/ or retain, also has stifled the natural growth and development of information technology core competencies: business process improvement and service. But moving on won’t be easy or cheap at the outset.

In a recent blog post titled “Building a Business Case for SaaS ERP: Why Schools are Switching and Why Schools are Waiting,” higher education consulting firm Collegiate Project Services named five reasons why institutions are adopting SaaS ERP: standardization, functionality, funding models, lower costs for IT administration, and technology. Citing any or all of these, in my opinion, represents strategic thinking and an understanding of the value IT represents to the institution.

Fear of Cultural Disruption

The five reasons cited in the post as to why colleges and universities are not moving to the cloud, however, are much more interesting. Standardization averse, risk averse, security perceptions, retaining control-each seems rooted in fear of cultural disruption or misinformation more than pragmatism. Evolving solutions, the fifth reason, seems to make the most sense. Because SaaS ERP is relatively new, it’s reasonable to expect that competition will emerge, costs will decrease, and technology will mature. One item that’s not on the list is initial cost. The absence of available capital is also a reality for many. While the transition to cloud-based systems may be easier than integrating legacy systems, that doesn’t mean it’s free. Colleges and universities are forced to weigh the upfront cost of a new ERP against other critical initiatives.

The Long-term Benefits

The urge to take the plunge, however, seemingly gets greater every week. With the maturation of cloud computing comes the potential for a level playing field. Smaller institutions now have access to the same platforms used not only by large state colleges and research universities, but also Fortune 500 companies and Silicon Valley giants. This means we will have native, mobile-friendly business intelligence, and a single line of code from which upgrades are performed systematically by the vendor. Business continuity is all but guaranteed, and information is available 24/7 from practically any device, anywhere, without the need to support a VPN. Costs are predictable and new features are added regularly, usually at no extra cost. Better yet, cloud-based systems are deployed rapidly and can be connected to existing legacy systems using API or pre-built connectors, thus allowing a modular or phased migration. Bringing users up to speed requires considerably less training because a browser-based interface is inherently more intuitive than a green screen.

Overall, the benefits of a cloud ERP seem clear. Although it will be expensive and disruptive in the short term, the capital investment will likely be repaid quickly through increased efficiency and productivity. In the end, everyone will benefit—end users, IT folks, and most importantly, students. I guess it’s time for me to set up my own common sense jar.

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