ERP

Microsoft Dynamics ERP Moves to the Cloud... Too Late?

N. Rowan

The continued popularity of cloud-based ERP (Enterprise Resource Planning) systems is underscored once more by the recent announcement that Microsoft will release its first cloud-enabled Dynamics ERP this year. The company will be using the Azure cloud platform for all four of its ERP lines, with NAV and GP – aimed at small to midsize businesses – coming out first. But in a market that’s expanding at a rapid pace, one might wonder if Microsoft isn’t late to the game.

Microsoft’s Competition in the Cloud

Software giant SAP, for instance, is already actively pushing their Business ByDesign suite — which also includes CRM, supply chain management, and other functionality — as well as its Business One OnDemand solution for small businesses. Oracle offers ERP in the cloud through its Oracle Fusion app, which includes more than 100 modules encompassing financial, human capital, supply chain management and much more. Workday and NetSuite, two purely cloud-based ERP systems, have been experiencing tremendous growth and signing on large enterprise customers. And a newer player to join the cloud-based ERP market, Infor, has teamed up with Salesforce.com to offer ERP data within Salesforce.com’s CRM system.

How Popular Is Cloud ERP Really?

Industry studies have shown that upwards of 70% of all businesses are using or exploring some type of cloud-based solution. The numbers get fuzzy, however, when it comes to ERP in the cloud. ERP buyers tend to be conservative as it relates to financial solutions. Many companies feel that ERP is too mission-critical to be hosted in the cloud. They regard it as not yet proven to be reliable and secure, something perhaps suitable only for SMBs. The strong growth of the cloud market can be attributed to companies extending their on-premise ERP solutions with cloud-based products such as the aforementioned CRM or SCM, analytical tools, and more. For example, cloud-based CRM has been around for years. Microsoft released theirs over 6 years ago, and even then they were considered to be late to the game. But they have already amassed over 1 million users, making Microsoft Dynamics CRM one of the most successful players in this market.

And that’s exactly what could happen with their cloud-based Dynamics ERP package as well. Microsoft Dynamics ERP for the cloud might not be so terribly out of step with the buying trends of the ERP market after all.
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