MIDDLE EAST MANUFACTURERS MUST EMBRACE CLOUD ERP

Cloud-based ERP can automate mundane tasks allowing businesses to prioritise innovation, competitiveness, and drive business growth.

The pandemic has transformed the world forever, beyond debate. The crisis management and siege mentality that marked the early pandemic years has given way to economic existentialism that requires enterprises to ensure their survival through acts of will and strategy. Industries are reinventing the rules of engagement, and manufacturing is exploring nearshoring and onshoring as strategies for the future, while also evaluating options for digital transformation.

In the Middle East, governments are reorganising their manufacturing sectors to diversify their economies, build resilience, and boost GDP. For example, the UAE Ministry of Industry and Advanced Technology launched Operation 300 billion, aiming to increase the

Key Takeaways

l Manufacturing sector in the Middle East is adopting digital technologies to elevate operations and introduce new efficiencies.

l Manufacturers are incorporating IoT solutions, workflow automation, and a range of field, floor, plant, and back-office technologies.

l Operational overheads can be eliminated by moving ERP systems from premises to the cloud.

l The capital requirement for unlocking innovation potential are far less, and expensive upgrade cycles are a thing of the past.

l Cloud ERP solutions offer scalability and flexibility, permitting changes to business workflows without as much effort or investment.

sector’s GDP contribution to AED 300 Billion or $82 Billion by 2031. However, there is still work to be done, as manufacturing only accounted for 12% of MENA’s GDP in 2021, compared to the global average of 17%.

Digitisation is critical to advancing the sector. The region is incorporating Internet of Things solutions, workflow automation, and a range of technologies to enhance operations and introduce efficiencies. The ERP system is at the core of this digital ecosystem, enabling and optimising everything from materials sourcing and inventory management to quality assurance and delivery. However, it is crucial for this ERP system to be in the cloud, to align with the corporate vision and ensure success.

Cloud Gaining Steam

Cloud adoption is gaining momentum, as demonstrated by Epicor’s research and the influx of hyperscale providers such as AWS, Microsoft, and Google in the Middle East. Despite the benefits that the cloud brings, many manufacturers in the region are hesitant to migrate from their on-premises IT solutions to the cloud. The manufacturing sector is known for its long upgrade cycles and ‘if it is not broken…’ attitude towards legacy systems, which inhibits the adoption of cloud solutions.

However, the cloud offers prebaked infrastructure and reduces the capital requirements for unlocking innovation potential. Small businesses, in particular, can benefit from enterprisegrade capabilities and gain scalability and agility.

Cloud ERP solutions provide scalability and flexibility, enabling changes to business workflows without significant effort or investment. Expensive, prolonged upgrade cycles become a thing of the past, as they are included in the subscription cost and managed by vendors and their partners. Overall, the cloud offers a trusted solution for infrastructure maintenance, backup systems, physical security, and more.

Risk And Reward

It does not stop there. The cloud is the gift that keeps on giving. Moving ERP systems to the cloud offers numerous benefits, such as eliminating operational overheads and faster implementation times. However, concerns about risk and the potential for downtime are justified, particularly for manufacturing operations that prioritise continuous uptime. Connecting critical operations and intellectual property to the internet carries inherent risks, but the cloud has come a long way in terms of security and reliability. Inaction can also pose a risk, as ageing infrastructure is prone to downtime and competitors may gain an advantage with more efficient and cost-effective solutions. Looking inward could lead to obscurity, so a pragmatic risk assessment is necessary.

Cloud adoption is gaining momentum, with many realising that it offers a competitive advantage, cost savings, and increased efficiency. ERP systems in the cloud can automate mundane tasks, allowing enterprises to spend more time thinking and training. This focus on innovation can lead to increased competitiveness and success for growing businesses. n