Cloud Migration Strategy: Manufacturing and The Cloud
By: Dan Johnson
It seems every industry and application is jumping on the cloud bandwagon and manufacturing is no exception. The cloud is a remarkably efficient solution for manufacturers facing increasingly competitive global markets, tighter turn-around deadlines, and rapidly evolving consumer trends.
While traditional on-premise systems such as ERP have served their purposes well, times are changing and it’s getting tougher to maintain legacy systems in the face of more flexible and easily scalable cloud alternatives. Many manufacturers are now developing a cloud migration strategy to help them address a wide range of challenges and issues, including automating and implementing sophisticated manufacturing processes. Welcome to “cloud manufacturing.”
Increased flexibility and control is perhaps the number one benefit of cloud manufacturing and migrating ERP computing functions to the cloud. In a traditional on-premise computing scenario everything is managed by IT. If manufacturing wants to make a change, they have to go to IT first, which checks the requested change against the budget, creates a value statement associated with the change request, and prioritizes it so it may or may not get done.
The cloud takes control away from IT and puts it in the hands of the user. It is the user who can quickly see if a software change offers good value and return-on-investment (ROI). This direct control enables the user to actively participate in continuous improvement, which increases both operational agility and efficiency.
Developing a cloud migration strategy and transitioning to cloud manufacturing provides a number of benefits across the enterprise, including:
1. Improved application integration and performance The responsibility of application development and updating for cloud-based software rests squarely on the shoulders of the software provider. Cloud-based systems are turn-key, with all the components necessary to perform the desired task included and optimized. Purchasing, installing, and properly integrating the various IT elements and components of an on-premise system; however, is entirely the responsibility of the manufacturer owner.
Think of it like acquiring an automobile. Putting together your own on-premise IT infrastructure is like selecting and buying an engine, transmission, frame, body, and wheels separately and assembling them to create a complete car. You don’t have to be concerned with what’s under the hood with a cloud-based system -- you’re buying a fully finished car, ready to drive. Everything’s integrated and optimized for maximum performance at less cost in time and money.
2. Easy scalability As manufacturing needs can fluctuate with seasonal or marketplace demands, so can the amount of computing power you utilize in the cloud. No need to buy more servers or expand your datacenter – the cloud-based software-as-a-service (SaaS) provider will take care of that automatically.
3. Lower risks and costs If your company is adding business units or opening new locations, integrating them into your IT ecosystem is easier in the cloud. No need to add networks, purchase new hardware, or upgrade software. And should an acquisition not work out, you’re not left holding a lot of extra infrastructure and added expense.
The cloud’s certainly not perfect, but it offers so many benefits not available with a legacy on-premise system that it’s hard not to embrace it. With its low cost of entry, rapid scalability and unparalleled flexibility, it’s easy to see why the cloud is becoming a major productivity driver for manufacturers. Still, there are plenty of organizations that are delaying developing a cloud migration strategy for various reasons. They do so at their own risk.