In response to the coronavirus pandemic, businesses are being forced to move to a remote work environment, resulting in a fundamental change in the way they operate. And as the economic tremors reverberate through businesses causing order delays, supply chain issues and customer payment defaults, the need for real-time information has become more critical than ever despite the workforce being separated.
Although nobody can say they were prepared for this crisis, companies still using older technologies like on-premise ERP are at a huge disadvantage and have been caught flat footed. Meanwhile companies that have embraced Cloud ERP are in better position to not only manage through this crisis, but also have the foundation for how work will be conducted in the future. Let’s examine why.
The New World of Remote Work – Like It or Not
According to the U.S. Bureau of Labor Statistics, an estimated 60% of the 118.3 million wage and salary workers (71 million people) could be working from home during this emergency, and many workers are already doing so. The pandemic has taught us a few things, and one of them is that remote work can work!
Product-centric companies that have been forced to adapt to remote work are discovering that:
- A lot of traditional office culture can be replicated with the new web or cloud tools available.
- Companies that were not supporting much remote working are finding what others have seen: that workers can be productive at home.
- Workers have mobile phones for communication to stay in constant touch, and for workers with children and elders to take care of, working from home can provide more flexibility and a better work-life balance.
- Younger workers are already used to the tools that support remote work and are adapting quickly. They like it.
All in all, this pandemic will have a profound impact on trends toward remote work, but one thing is clear: Remote work is here to stay.
New Technologies Enable Remote Work
New technologies are coming to the forefront to make remote work both possible and productive. What are some of new tools that remote workers are using?
- Video conferencing: Zoom has quickly become the most popular video conferencing tool and the word “zoom” is becoming more than a brand name (like Kleenex, Google or Xerox). Even outside of work, people are finding Zoom to be a convenient way to meet and socialize virtually. As distance working becomes even more widespread, Zoom and tools like it will become as ubiquitous as email.
- Instant messaging: IMs are not just for kids anymore. In addition to text messaging on their cell phones, remote workers are collaborating using tools like Slack for online conversations and impromptu phone calls.
- Project management: Most workers have at least some exposure to project management, whether it’s in the role of project manager or a contributor to a project. Tools like Asana and Trello let remote workers manage projects and collaborate with project team members easily and effectively.
- Productivity tools: File-sharing and storage tools like Google Drive and Dropbox have been around for a few years, but their value is now being seen in remote work environments where team members can quickly store and share important documents with each other from anywhere.
- Software development tools: For software developers, the online repository GitHub has become a key resource to share and build software with each other. You can call it a virtual community for programmers.
But What About ERP?
While most of the attention recently has focused on Zoom’s rising fortunes in the stock market and its role in making virtual collaboration easier, what about ERP, the backbone of a company? An ERP engine that underpins a company’s operations is arguably the most important system of all. How are companies coping in this environment in regard to ERP, especially those with older legacy technology?
Manufacturers and distributors still using on-premise ERP systems are having a particularly difficult time adapting to this new world of remote work and the pace of the change in the business. They are struggling because of several limitations:
- Aging technologies: These bring with them network limitations such as bandwidth, firewalls and VPN capacity. Rob Smith, an analyst with Gartner, says that corporate VPN is an aging technology and before the coronavirus pandemic, he believed it was on its way out as more companies migrated to cloud-based services. Many businesses were simply not ready for that many users coming from outside the company; they didn’t plan on it. In fact, many companies don’t have enough laptops for all their newly-minted remote workers. This all adds up to a giant headache for IT in the form of more desktop support and system access requests .
Note that this not necessarily the fault of on-premise ERP, but because ERP has been anchored in-house, most IT organizations have not created an infrastructure that is optimized for all their traffic to come from the outside. This ups the ante on security protections and skills needed as more traffic is entering the building 24×7.
- Slow and cumbersome remote desktops: Some companies provide remote access via Citrix®, Microsoft Terminal Services® and/or Microsoft Remote Desktop®, services that replicate a desktop over the internet. Not only are these not natural mobile apps, but they also tend to get slow as more workers access the server at the same time especially if it isn’t architected to handle the increase in volume. Stable connectivity is often an issue with these types of technologies. Some, like Microsoft Remote Desktop, bring a new and more complex set of security issues that needs to be managed and supported by IT at a time of duress.
- Different departments using different systems: The problems of supporting a remote workforce get worse when departments use different systems, such as ERP and CRM. In a typical office environment where departments are using different systems, productivity relies on people to bridge the gaps by walking down the hall, having meetings or creating cumbersome email chains. Put another way, fragmented systems increase the need for manual collaboration at a time when you don’t need it. Remote work exasperates this problem and even makes it even harder.
- Slow, Waterfall Styled Reporting: Older systems often require batch processes and cascading feeder systems to create meaningful reports. In these times when executives are monitoring cash flow several times a day, waiting for a system to generate reports nightly is not acceptable. Many companies have implemented data warehouses to join data from various ERP systems, but this still requires updates from feeder systems to populate the reporting database. In this fluctuating business environment , you’ll need real time view of your key indicators on receivables, cash, supply chain, production, new opportunities and orders. Older systems simply are not up to the task.
The Advantages of Cloud ERP During This Crisis and Beyond
The cloud offers several advantages that support a remote work environment and can provide the constant stream of information that companies need to manage during a time of crisis:
- Reduced IT burden: With the cloud, the IT burden is considerably less, despite more users accessing systems from outside. Rather than stretching the skills and resources available to manage VPNs, firewalls and data security on a 24×7 schedule, companies can leverage the capabilities of a public cloud whose infrastructure is designed specifically for 24×7 operating access.
- Mobility:– Mobile access via cell phone is a key advantage of the cloud. In this current environment, employees need the flexibility to attend to children at home or other family matters while keeping an eye on the office. This is why mobile connectivity and a great mobile user interface for enterprise applications is critical.
- Scalability: The cloud was designed from the outset to scale up or down, to be elastic to handle peaks. Scaling is also much easier during peak load times, not just during this pandemic but during normal business rush cycles such as end-of-month activity to ship orders, invoice customers and close the books.
- Simple user interface: Cloud apps are designed to be easy to use, with simple browser based user interfaces. They are less complex to use and set up than Microsoft’s Terminal Services, Remote Desktop or Citrix. Most users find having two desktops very confusing (the remote desktop and the local desktop). For users who access both browser-based and terminal server-based apps, bouncing back and forth can be cumbersome and frustrating. Remote desktop services also must be installed and managed by IT staff. The cloud frees IT from these tasks. At a time when IT managers are inundated with requests to support remote workers, they don’t need the added complications of remote desktop technology.
- One cloud makes collaboration easier: Let’s get back to those companies with fragmented departments. Those users may not be set up to access other departments’ systems remotely. With more distance between workers, collaborating or getting information is that much harder. Modern cloud applications that combine ERP and CRM in one cloud allow the data to be in one place, breaking down the artificial walls between departments. Imagine a manager who wants to know when a large order is going to ship so he or she can generate and send the large invoice. The manager might need to drill down to planning, production and then purchasing to see where the process has stalled. With a combined cloud-based ERP and CRM, the manager doesn’t need to collaborate at all because the single cloud approach allows them to drill down and drill around ERP and CRM. They are self-sufficient.
- Built-in collaboration tools: Modern cloud ERP applications also provide familiar and easy to use collaboration tools such as social media embedded in the application, which eliminates bouncing around between ERP and detached messaging apps. Collaboration occurs naturally in Cloud ERP and is attached to ERP data or processes.
- Real-time reporting: Modern cloud systems are designed to work in real time. For instance, these days most companies are very concerned with cash and need to see real time balances as the day progresses. Or they can set up alerts when cash balances or receivables situations exceed a threshold.
- End-to-end 24×7 visibility: Many manufacturing managers love to walk around a physical shop to see what’s going on in their business. But what if your company becomes more virtual? Even with a remote workforce, you still need to constantly understand what is going on in sales and the supply chain, and the impacts on production, receivables and cash management.
And keeping your finger on the pulse of the business is even more important now. Modern cloud systems that have a common data model across ERP and CRM allow you to deploy dashboards of key business indicators, such as new orders, receivables, payments, cash balances, suppliers, inventory, and production. The “clicks not code” approach in modern systems allow business users to create these dashboards themselves without burdening IT.
All of a sudden, companies are realizing that they can do a lot of their work remotely. Those that embraced cloud ERP are in better position to weather the storm and keep operating efficiently. From all of this, we’ve learned that remote work is not only here to stay, but it will most likely become more prominent going forward. And having the ability to monitor KPI’s in real time has never been so important. To do this right and economically, Cloud ERP is the technology of choice.
But don’t take our word for it; read what one of our customers told us recently about dealing with the disruption of the coronavirus:
“The office is working from home. It’s times like these where our investment in Rootstock and other clouds are priceless. Our shop has been intensely focused on staying healthy; from adding door mechanisms to making them open hands free, to making our own hand sanitizer and everyone getting their own personal labeled supply at their workstation, to intense training on hand washing, and much more. And despite all of this, we are continuing the amazing turnaround in our business. This was one of our best months we have ever had in terms of net profit, if you can believe it. Also, our on time delivery percentage was nearly perfect this month even though it is our busy season. In years past, it was total chaos and overloaded capacity.”