Looking to Migrate to a Cloud Environment - Any Suggestions?

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If you participate in any accounting or business- related online groups, you've probably seen more than one post asking for advice on moving to the Cloud.  While everyone has slightly different environments and circumstances, the following recommendations will be helpful for most businesses:

1) Evaluate providers who use data centers which, at a minimum, maintain Standards for Attestation Engagements 16 (SAE 16)certification, the standard that has replaced the Statement on Auditing Standards 70 (SAS 70).  Best practice would include ISO27001 registration too (security protocols).

2) Procuring hardware can span the spectrum from a baseline collocation facility approach (renting space) to a fully managed hosting environment.  Another term called 'Private Cloud' points to dedicated infrastructure on a company specific basis.  Ascertain which model is appropriate.  Who supports the hardware?  What is - and is not - included in that support?

3) You'll often need to decipher imprecise jargon and define complex terms.  Instead of selling the servers, is your vendor providing a lease on the dedicated infrastructure?  If it is a lease, is the hardware refreshed regularly or simply a cash flow exercise to avoid a CapEx expense?  Any financial benefits that apply?

4) Determine what tasks and cost savings are anticipated (the ROI).  Simply moving to the Cloud does not necessarily represent significant monetization if your company is still responsible for the day-to-day administration.  In contrast, a strategic move to outsource system administration functions may be in order.  What are your core competencies as an organization? Articulate the added benefits such as 24x7 support, heightened security protocols, improved customer perception, etc.  Ask yourself how important these types of criteria are to your business success.

5) Consider both the idea of outsourcing IT systems combined with a longer term strategy of replacement / upgrades to business systems delivering the solution as a cloud service (Infrastructure such as Microsoft Azure or equivalent, productivity software such as Microsoft Office 365, telecom such as hosted VoIP, etc.). You are most likely already using an outsourced payroll provider so this is not necessarily your first entre into the cloud.

SaaS acts as an enabler of the cost savings the cloud portends.  Combining the advantages of shared infrastructure and software provisioning / support creates economies of scale which small business cannot typically afford.  As a result, you may eliminate significant IT competitive disadvantages.  The key when adding business applications, ERP being a model metaphor, is to focus on vendors with deep industry expertise and functions that cater to your exacting processes.  Otherwise the savings you anticipate may evaporate trying to bend the application to fit your needs.

6) Last, do your due diligence on the Service Level Agreements (SLA).  Should you need professional help understanding best practices and ramifications of the agreement, do not hesitate to contract professional guidance.  It is as important to have a good business document as it is to have good technology support.

If you have questions about Cloud ERP, please contact Tensoft for answers.

by Michael Chadwick, Tensoft - ERP Solutions for the Software, Technology and Semiconductor Industries

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