Manufacturing ERP systems are robust, complex, often challenging to update - with most due for modernization. For a long time, they performed without much fallout from a business standpoint.
But the world has changed, and manufacturing, once a behind-the-scenes operation, is now a very customer-facing business. Customers want to interact digitally with companies and know where their orders are at every stage of the supply chain, meaning manufacturers need better data collection and analysis capabilities to enable real-time visibility.
At the same time, a increase in automation on the manufacturing floor and rise of remote work has created a need for better connectivity both on-site and off. Legacy, monolithic ERP systems have no way of providing it at the level modern business requires.
The cloud has clearly emerged as the best solution for operating a manufacturing business for the future. For SAP users in particular, S/4HANA capabilities far outperform legacy SAP systems and provide the type of data analytics capabilities and constant connectivity needed to meet today’s business standards.
In this article, we’ll explore five compelling reasons for manufacturing companies to consider SAP cloud modernization sooner rather than later (and how Protera can help you execute).
Quick Takeaways
- Infrastructure support provided by cloud hyperscalers and modernization partners allows manufacturing companies to stay focused on mission-critical activities.
- Cloud modernization levels up supply chain visibility for manufacturers and creates a single source of truth for contributors at every phase (end customers included).
- The cloud eliminates data silos and the business challenges that come with it (like disparate data, slower response times, and lower agility).
- Customers now expect response times and real-time updates from manufacturing companies only possible by operating on the cloud.
- Cloud-centralized financial and operational data allows business leaders to make more agile cash flow management decisions that drive company growth.
5 Reasons Manufacturing Companies Should Modernize with Cloud
#1: Infrastructure support
The longer a legacy infrastructure system is maintained (which for some companies is decades), the more challenging and costly it is to modernize.
For manufacturing IT leaders, the prospect of SAP modernization can seem daunting. But with SAP users modernizing to the cloud, hyperscale cloud providers and certified SAP partners take infrastructure management responsibilities out of the hands of internal IT teams.
Instead, you can focus on mission-critical business priorities with confidence knowing they have ongoing expert support and infrastructure housed by the likes of Microsoft, AWS, or Google. Remote infrastructure and outsourced management also result in significant savings related to time, cost, and IT maintenance.
#2: Greater supply chain visibility
Real-time supply chain visibility is no longer a nice-to-have in the manufacturing world — it’s a must. SAP cloud modernization for manufacturing companies enables cloud-, edge-, and fog-supported IoT data processing to provide real-time updates for everyone along the supply chain (end customers included).
It also provides a central source of truth across geographic locations for greater reporting accuracy and a shared understanding of the current state of inventory at any given moment.
#3: Improved customer experience
Customer experience is the business area that’s perhaps required the most adjustment and driven the biggest need for SAP cloud modernization for manufacturing companies. eCommerce and smart devices have radically changed the way customers want to interact with businesses, and reactive or slow-response customer service models no longer suffice.
There are two notable changes manufacturing companies must be equipped to handle as a result of this shift:
- Customers want end-to-end visibility: They’re no longer interested only in last-mile updates only (after product has left the facility). Instead, they want real-time updates across the entire product lifecycle.
- Elevated customer expectations: Across industries, customers now expect faster response times and more agile businesses who can meet faster-changing needs. In manufacturing, for example, customers expect that the best companies can meet last-minute order requests or unexpected order changes.
The cloud gives manufacturers access to the real-time information needed to shorten response times and accurately assess at any moment whether they’re able to meet a particular customer request (and see both the upstream and downstream impacts of fulfilling it).
#4: Connects all supply chain contributors
Geographic constraints and data silos once created separation across supply chain contributors. SAP cloud modernization makes the same data available to anyone, anywhere — production teams, warehouse personnel, inventory managers, field technicians, drivers, IT leaders, business managers, front-line customer service reps — and this list isn’t exhaustive.
This degree of connectivity and centralized access has ripple effects that ultimately drive better communication, greater agility, enhanced security, and smarter business decisions at every level.
#5: Agile Cash Flow Management
End-to-end and real-time visibility powered by cloud modernization enables more agile cash flow management for manufacturers. Centralized financial and operational data makes forecasting more accurate, and managers can make better decisions about leveraging cash flow to drive growth.
Further, cloud computing automation creates greater cash flow efficiency through faster invoicing, frequent reporting, and accurate tracking and monitoring of customer payments.
Why Protera is Your Cloud Modernization Partner for Manufacturing
As a globally certified SAP partner and the first to run SAP on the public cloud, Protera is a leader in running, protecting, and helping manufacturing companies realize the full potential of SAP and enterprise environments.
With Protera as your SAP modernization partner, you’ll experience:
- Financial Governance - Real time dashboard of cloud costs and continuous monitoring of potential cost reduction and budget reallocation opportunities to focus resources higher up the stack.
- Data Security - Data intelligence and 24/7 security and monitoring to unearth insights as well as protect every layer of your company and its data.
- Operational Scale - Managed IT services team that manages, deploys, and backs up your enterprise assets so you can focus on projects up the stack.
- Automated Processes - Fully integrated SAP and enterprise technology solutions driven by automation reduce risk and accelerate time to value.
- Continuous Improvement - Embedded across Protera’s application and cloud-managed services model.
Learn more about SAP Cloud Modernization with Protera and schedule your virtual solutioning session today.