, Workday Keep Cloud Momentum Rolling - InformationWeek
Cloud // Software as a Service
09:26 AM
Doug Henschen
Doug Henschen
Connect Directly
Faster, More Effective Response With Threat Intelligence & Orchestration Playboo
Aug 31, 2017
Finding ways to increase speed, accuracy, and efficiency when responding to threats should be the ...Read More>>, Workday Keep Cloud Momentum Rolling

The latest Salesforce and Workday results echo InformationWeek research: Cloud apps are moving beyond SMBs and into hard-core areas like ERP.

Microsoft is another vendor scaling up ERP in the cloud. Microsoft made its Dynamics GP and Dynamics NAV ERP systems available on the Windows Azure Cloud this year (as hosted services) and has promised to bring its flagship Dynamics AX ERP suite to Azure in 2014 (as a multi-tenant service). GP and NAV are typically used by small and midsized companies, but AX is more scalable, currently used (on-premises) by companies including Dentsply and Revlon (with $2.9 billion and $1.4 billion in 2012 revenue, respectively). Dell (a $57-billion-revenue giant) is also a customer, but it uses AX for a custom manufacturing resource planning app. Dell's core financial ERP system is Oracle E-Business Suite, and that's not about to change.

For now it's safe to say that companies in the Fortune 500 have no choice but to use conventional on-premises ERP software for their large-scale demands (we'll get to alternative deployment options in a moment). It's also safe to say that many enterprises may never consider cloud-based enterprise apps (also known as software-as-a-service -- the style delivered by NetSuite, Salesforce, Workday and the like). Despite all the cloud progress, 46% of our survey respondents are still not using SaaS. They cite data security (34%), data ownership (13%), auditability (11%) and integration (11%) as persistent concerns that prevent them from making the leap.

There are alternative application deployment options that don't involve SaaS, yet still get called cloud by some people. But here's where the use of the term gets fuzzy. Hosting, for example, has been around for years, and indeed it's used by 43% of our respondents. But good luck finding the kind of rapid hosting deployment or scaling capabilities that people associate with cloud deployment.

[ Want our latest insight on enterprise apps? Download Research: Cloud Software: Where Next?. ]

Private cloud is another alternative, and it's being used by 25% of our respondents. Some take private cloud to mean building virtualized capacity and services in your own data center (as we defined it). Others interpret private cloud as also covering one-off instances of applications supplied and maintained by a software vendor or vendor partner.

We asked our survey respondents which alternative deployment options they're "actively or potentially considering" for future use, and private cloud was the most popular choice (cited by 48%) followed by public cloud (34%) and hosting (26%).

What do most big enterprises want from cloud services? The bottom line is "trusting a third party to take care of the infrastructure," according to integrator Mark Willford, global managing director of SAP business at Accenture. "They don't want to have to build infrastructure and they don't want to be overly dependent on IT departments."

Cloud in this context can be achieved with managed services or private clouds. Nonetheless, many companies -- particularly financial services and global companies with European operations -- are sticking with on-premises applications, Willford says.

Given the diversity of opinions about cloud, we'll increasingly see a diversity of deployment options from enterprise application vendors. Microsoft and Oracle have been touting on-premises, private-cloud and public-cloud options for at least two years. SAP recently introduced its Hana Enterprise Cloud, which gives the company a managed service offering on top of existing hosting options and selected SaaS applications (including SuccessFactors, Business ByDesign, Sales OnDemand and so on). Infor and Epicor offer hosting and selected SaaS options. There's talk of a private-instance government cloud for would-be federal customers, and you can bet that private-cloud options for security-sensitive companies won't be far behind.

As we conclude in our report, the new normal is that there is no normal where enterprise app deployment is concerned.

2 of 2
Comment  | 
Print  | 
More Insights
Newest First  |  Oldest First  |  Threaded View
User Rank: Author
9/5/2013 | 10:30:25 PM
re:, Workday Keep Cloud Momentum Rolling
I heard an interesting theory this week: once big companies decide to move to a cloud enterprise app, they can do it very fast -- faster than smaller companies -- because the big guys have done the whole ERP re-enginnering thing, they know the pros and cons and what works and doesn't; they're going cloud which helps IT ops, but the business process change isn't that great.
User Rank: Strategist
9/5/2013 | 9:55:49 PM
re:, Workday Keep Cloud Momentum Rolling
ERP and most back office functions are eventually on an almost certain migration path into the cloud, except those that are tied to core business operations. The data will need to be encrypted both in transfer and in storage but that will become a routine operation, On premises software will reflect what's unique about the business. Everything that's done like other businesses will be found in the cloud. Granted, we're nowhere near such a world yet but we are moving in that direction.
User Rank: Author
9/5/2013 | 6:46:41 PM
re:, Workday Keep Cloud Momentum Rolling
There was a time when people thought email wouldn't move into the cloud: Too mission critical.
D. Henschen
D. Henschen,
User Rank: Author
9/5/2013 | 1:37:05 PM
re:, Workday Keep Cloud Momentum Rolling
Other interesting insight from our research: Cloud apps seem to have an Apple-like fanboy factor, with average satisfaction ranging from 3.1 to 3.7 on a scale of one to five (with on being "very unsatisfied" and five being "very satisfied"). On-premises app satisfaction is several points lower, ranging from 2.7 to 3.4.

Top points of cloud satisfaction: serviceability and ease of implementation. Bottom: ease of customization and integration. Top points on on-premises app satisfaction: reliability and availability of technical/industry expertise. Bottom: ongoing maintenance and support cost and initial software cost.
How Enterprises Are Attacking the IT Security Enterprise
How Enterprises Are Attacking the IT Security Enterprise
To learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
Register for InformationWeek Newsletters
White Papers
Current Issue
IT Strategies to Conquer the Cloud
Chances are your organization is adopting cloud computing in one way or another -- or in multiple ways. Understanding the skills you need and how cloud affects IT operations and networking will help you adapt.
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Flash Poll