Published on February 18, 2014
Niche Reports for our Niche Clients A report into the future of ERP Part 1 of 3: ERP goes to the clouds
Different Clouds of ERP:
Why Business has gone to the cloud ? Companies today are under pressure from the economy; changing technology; changing customer, employee, and partner expectations; and the need to compete in an increasingly complex connected global economy. To adequately respond to these pressures, businesses are looking to use technology as the lever for and the underpinning of new, innovative approaches to business. The cloud is a critical part of that strategy for most businesses and supports other key technologies like mobility, decision support systems, and collaboration/social systems. By moving ERP systems to the cloud, companies can gain an assortment of technological and business benefits. Enterprise IT is embracing cloud-based ERP for many reasons, including: Ease of deployment Pay for only what you use Quicker deployments leading to faster time to value and freeing up resources for more strategic initiatives More flexible and scalable solutions to provide long-term support for growth and expansion …
The choice of public, private, or hybrid cloud is a strategic business decision and should be examined closely. There are benefits, costs, and risks with each model as well as regulatory and compliance issues that vary by industry. When companies look at the cloud, there are many factors that influence the decision to move all or some of their applications to the public cloud. Highlights the top 5 drivers in terms of choice
Platform as a Service Software as a Service DIFFERENT Shades of Cloud Infrastructure as a Service
ERP in the Cloud and the Modern Business *Software as a Service (SaaS) and cloud-based business application services will grow from $13.4 billion in 2011 to $32.2 billion in 2016, a fiveyear CAGR of 19.1% *Public and private cloud computing will be strong catalysts of server growth through 2015. IDC reports that $5.2B in worldwide server revenue was generated in 2011 or 885,000 units sold. IDC is forecasting a $9.4B global market by 2015, resulting in 1.8 million servers sold. * IDC reports that enterprise cloud application revenues reached $22.9B in 2011 and is projected reach $67.3B by 2016, attaining a CAGR of 24%. IDC also predicts that by 2106, $1 of every $5 will be spent on cloud-based software and infrastructure. Report, Worldwide SaaS and Cloud Software 2012–2016 Forecast and 2011 Vendor Shares.
SaaS & Open Source ERP Increasingly in today’s marketplace companies are turning to web-based and SaaS services in which a third party hosts the application. The underlying software driving the SaaS solution can be either commercial or open source. Salesforce is an example of a commercial solution that supplies both software and services and supports itself by charging for software, services, configuration, training, and customizations. In the case of open-source software, a SaaS solution is only available through service providers who charge for the providing services that can range from simple hosting to full application support. SaaS and the Cloud SaaS ERP and Open Source Open source is estimated to account for approximately 1.5% of the total ERP market. For a long time companies that wanted ERP could only choose from among various proprietary commercial solutions. Recently, however, more open source ERP solutions have matured.
SAAS The three most popular netnew SaaS solutions deployed are CRM (49%), Enterprise Content Management (ECM) (37%) and Digital Content Creation (35%). The three most-replaced onpremise applications are Supply Chain Management (SCM) (35%), Conferencing, Web teaming platforms and social software suites (34%) and Project & Portfolio Management (PPM (33%). The following graphic shows the full distribution of responses. Gartner is predicting Infrastructure-as-a-Service (IaaS), cloud management & security devices, and Platform-asa-Service (PaaS) are growing from $7.6B in 2011 to $35.5B in 2016, a CAGR of 36%.
PAAS The global Platform-as-a-Service (PaaS) market is growing from $900M in 2011 to $2.9B in 2016, achieving a 26.6% CAGR. At this projected rate, PaaS will generate an average of $360M a year in revenue between 2011 and 2016. Gartner projects that the largest segments will be Application Platform Services (aPaaS) which generated 35% of total PaaS spending in 2011, followed by cloud application lifecycle services (12.5).
In 2011, the worldwide enterprise application software market generated $115.1B in revenue, and is projected to grow to $157.6B by 2016, attaining a 6.5% CAGR in the forecast period. Gartner reports that 38% of worldwide enterprise software revenue is from maintenance and technical support; 17% from subscription payments; and 56% from on-going revenue including new purchases
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