In my role as leader of a Cloud ERP provider, I have the luxury and pleasure of research and learning from industry analysts such as Gartner, SMB Group and IDC along with leading publishers like Microsoft, SAP, Sage and Citrix. I listen to these companies and temper them with the experience of hundreds of customers to form opinions on products and services that will improve the effectiveness and efficiency of our clients.
By the end of 2018 a majority of companies with under 1000 employees were using the cloud. Whether it was Office 365 for collaboration, Mail Chimp or Constant Contact for marketing automation or a payroll service the small to mid-size company has embraced the cloud. The trend of increasing adoption has been relatively slow and steady but continues.
The former pitch of lowering costs through cloud adoption has given way to the more accurate pitch of increasing efficiency and driving growth. The public clouds such as AWS and Azure continue to lead the pack, but variable costs and complexity of lifting systems from in-house to place them on these clouds has shifted the market to a packaged solution approach. This trend is only expected to increase in both offerings and targeting in 2019.
A packaged approach refers to a holistic offering of more than just cloud as a technology, but a combination of software and services on the cloud to meet a specific business objective. Cloud human resource and payroll services have been offering packages for a long time. The customer generally doesn’t care where the cloud is, but what the service provides and its relative cost for the solution. Packaging has moved into Customer Relationship Management and other generic technology categories where the solutions are then tailored for the specific industry.
This trend is also being driven by the business owners’ priorities. Companies have been doing better and are looking to leverage their cash reserves to grow their business. Technology is now being seen as tools for increasing efficiency and to drive growth in the SMB market. The most common investments are centered around attracting new customers and improving the customer experience. This used to be viewed as setting up or improving the eCommerce site, but is now trending towards improved collaboration between people and systems to improve the customer experience.
In the I-BN space of business management software, adoption of the cloud has historically been slower, with estimates hovering around a 30% cloud adoption rate in 2018. With our vertical industry package for distribution and our focus on the construction supply market, our cloud adoption rate is nearing 70%. Based upon the research and our customer feedback drivers for the high adoption rate include:
- Comprehensive nature of the solution replacing 3 or more systems which were not connected and resulted in slow information, re-keying errors and most importantly lost sales.
- The use of cloud work-spaces where the user experience was consistent whether on their laptop, tablet or mobile device.
- Industry specific configuration of the package which reduced time to value and increased efficiency,
While ERP publishers have been pushing their reselling partners to take the industry solution approach for decades, the shift from perpetual licensing to subscription pricing has forced consultants to shift their offerings.
- Small enhancements to powerful software often improve the workflow for users, making adoption easier while maintaining upgradability and reliability
- Pre-configuration reduces time to value and related consulting costs
- Industry focus increases business process awareness and ability to communicate with employees at all levels of an organization
I-BN has developed a six point analyzer to help companies evaluate whether they can increase efficiency with a modern business management system in the distribution industries.
For more information on the I-BN distribution Start Package visit our distribution website or contact our team at 678-401-6244.