Information is a crucial asset to the long term survival of every organization. Hence, the management of VINSUN must strive to incorporate all the necessary processes and strategies to ensure proper information management. Notably, the continued growth of VINSUN infra engineering has made such information management methods as excel to become inefficient in information processing. Therefore, for VINSUN, to remain competitive in the competitive market and to enjoy a competitive advantage, the management must adopt the most recent information processing methods such as enterprise resource planning on-premise or on a cloud. Therefore the managing director of the organization has opted to adopt on enterprise resource planning on cloud over cloud-based ERP. This is because of the vast advantages that cloud-based ERP has over enterprise based which will ensure the maximization of shareholders wealth through the creation of positive NPV (Duan and Jiaqi, 34).
Many companies have experienced challenges when it comes to dealing with the management of the information system, and VINSUN is not an exemption. However, on the realization of efficient enterprise resources planning everything then becomes clear. The management of VINSUN has decided to go the cloud-based ERP direction due to the cost advantage it has over premised based ERP. On premise-based, will require huge upfront capital investment to be availed for the cost of software, servers and hardware, backup devices, secure facilities, and operating system. Moreover, if the organization does not have a qualified IT staff to run the premised ERP, it will no doubt hire or train an expert (Duan and Jiaqi, 67).On the other hand, cloud-based ERP is a much cheaper option since it offers a low cost with no high upfront concerns as compared to premised ERP. Cloud offers software as a service (SaaS) where everything will be provided to VINSUN by the cloud vendor based on subscription. Therefore, cloud-based ERP will be suitable for VINSUN organization in terms of cost and also an easy adaptation from its employees who are not wholeheartedly ready for the changes. Undeniably, the adoption of cloud-based ERP is flourishing due to its low cost of entry and less time of implementation besides it being easy to start hence no need for VINSUN incorporating IT implementation.
` Essentially, cloud-based ERP software is managed by the vendor’s servers and accessed through the web browsers. On the other hand, on-premise, ERP software is installed on the own organization computer locally and therefore it is the responsibility of the management of the organization to ensure the safety of information. Notably, due to Large resistant of VINSUN employees on adopting cloud or premise-based ERP, the probability of the employees taking necessary steps to ensure information safety would be minimal. Hence cloud would be suitable since data security would be in the hands of the vendor (Shukla and Abhay, 9). In turn, this move would ensure efficiency and flexibility in the organization since employees will be in a position to access ERP on cloud from anywhere on the internet under the security assurance of the vendor provider. Moreover, in such issues as speed and connectivity, the vendor would act first to restore the situation.
Sales Automation and Return on Investment (ROI).
The adoption of cloud-based ERP has involved the incorporation of sales automation which in turn will make VINSUN organization to realize a good return on investment. It is evident that cloud-based ERP will have automated sales which are not in the case of premise-based ERP. For VINSUN, to realize the benefits associated with ROI and sales automation that helps in boosting the organization marketing department, VINSUN IT department should give this advantage a top priority (Weng, and Ming, 310). Moreover, cloud-based ERP is capable of providing increased speed implementation and deployment of various sales automation techniques that will eventually provide sooner ROI to the organization. Hence VINSUN will not need any form of physical servers and associated complex IT infrastructure which would have been a necessity in case they would have deployed premise-based ERP.
Besides, cloud ERP has proved to offer rapid implementation approaches, which can be appealing to the organization since it involves the integration of the fundamental primary organization process involving data and information management.
Mobile Platform for Sales People
Another advantage of cloud-based ERP over premise-based is that it will give VINSUN organization an opportunity to construct a mobile platform for a salesperson. In turn, this will boost the organization system performance. Therefore Sunil Satav should be wary that, managing information system can be a frustrating issue if not well addressed by the IT department hence he should be wary of this fact in order to remain competitive in the market for a foreseeable future (Weng, and Ming, 311). When information management due to the adoption of poor management techniques, the IT department will be responsible for everything that happens. Hence the adoption of cloud-based ERP which will create a mobile platform or the organization thus boosting the overall performance of the organization. Notably, the mobile platform will be integrated on cloud which is capable of operating even with a low bandwidth connection that will also prove to be a cost-cutting option for VINSUN. The mobile platform will provide all the organization stakeholders to experience the real-time performance of the organization at the click of the button
Pay per Use Advantage and Increased Back-up Interval
Cloud-based ERP will permit VINSUN organization to pay only for the used model. When the organization is using one premise solution, a variety of hardware can be bought to handle the information need of the entire organization(Weng, and Ming, 310). On the other hand, cloud-based systems can be used by the organization to back up the data from anywhere; hence it will be difficult for the organization to completely lose its confidential information even during a power disruption.
Consequently, in as much are there exist many various advantages of cloud-based ERP over premised based, there exist some of the challenges that Cloud face, but cannot make it not to be adopted by VINSUN. One of the disadvantages of cloud ERP is that the organization will incur more cost in a more extended period. Therefore the management can opt to install Premise ERP and being ready for the initial challenges that can make the organization collapse, hence with the disadvantage, cloud-based ERP is still at par compared to its counterpart. Moreover, vender migration can be a challenge if VINSUN wants to change its vendor. This can lead to more cost and disruption and even loss of organization information. This is minimal in case of premise-based ERP.
Duan, Jiaqi, et al. “Benefits and drawbacks of cloud-based versus traditional ERP systems.” Proceedings of the 2012-13 course on Advanced Resource Planning (2013).
Shukla, Sapna, and Abhay Shukla. “Trends in Cloud-ERP for SMB’s: A Review.” International Journal of New Innovations in Engineering and Technology (IJNIET) 1.1 (2012): 7-11.
Weng, Fumei, and Ming-Chien Hung. “Competition and challenge on adopting cloud ERP.” International Journal of Innovation, Management, and Technology 5.4 (2014): 309.
Do you need high quality Custom Essay Writing Services?