Tuesday, February 14, 2012

The Cloud and SaaS: Enabling Lean Businesses

One of the readings for this week covers the subject of lean manufacturing. The primary effect of lean manufacturing, or also known as lean thinking, is the improvement of flow. It means that products, or services, are moving faster from production to customers. This is possible because one of the principles in lean thinking is how to run production systems in a more efficient and effective way.

It might be common to think that implementing technology in businesses to improve business processes may cost a lot. Investing in hardware, purchasing proprietary software, hiring technical specialists to install or maintain the hardware/software, are just some of the cost that may add to the expenses of a business.

So can a business improve its process by implementing technology, but still cut costs? Can technology be utilized to apply lean thinking?

One of the trends in technology nowadays is cloud computing. There are companies that are offering business solutions for customers without having the need to install expensive hardware. There is even no need to install software. All of the resources are provided over the Internet, or in the “cloud”.

However, cloud computing may not be suitable for everyone. Since it operates over the Internet, it depends on an established and reliable network. There might also be some security issues, since the information is stored in the cloud.

So is cloud computing just a hype? Check out these interesting headlines from the past several months in sequential order:
  • Oracle Buys Cloud-based Customer Service Company RightNow For $1.5 Billion (October 24, 2011 via techcrunch.com)
  • SAP Challenges Oracle With $3.4 Billion SuccessFactors Purchase (Dec 07, 2011 via zdnet.com)
  • Oracle buys Taleo in a $1.9B response to SAP (Feb. 9, 2012 via gigaom.com)
One thing that RightNow, SuccessFactors, and Taleo have in common is they all offer cloud-based services in the form of Software as a Service (SaaS). Based on the large amount of money invested by large companies such as Oracle and SAP, there must be something special in the “clouds”.

  1. Nave, Dave. “How to Compare Six Sigma, Lean and the Theory of Constraints: A Framework for choosing what’s best for your organization”. Quality Progress, March 2002, Volume 35 Number 3. American Society for Quality.
  2. http://businessonmain.msn.com/browseresources/articles/itandproductivity.aspx?cp-documentid=32113199#fbid=YtKN8eXN7BF
  3. http://en.wikipedia.org/wiki/Cloud_computing
  4. http://techcrunch.com/2011/10/24/oracle-buys-cloud-based-customer-service-company-rightnow-for-1-5-billion/
  5. http://www.zdnet.com/blog/howlett/sap-acquires-successfactors-a-first-take/3608
  6. http://gigaom.com/cloud/take-that-sap-oracle-buys-taleo/

1 comment:

  1. Thanks for your greatful informations on ERP Implementations.
    It looks like you spend a large amount of time and effort in writing the blog. I am appreciating your effort.
    ERP solution which gives customer full control of the system and their operations. The Cloud offering is best for organizations with limited complexity, size and global presence.
    Thanks for sharing such a nice blog on Saas erp.


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