Many companies today not only have an IT strategy, but also a dedicated cloud strategy such as "Cloud first."
The main question that arises is: Will all processes migrate to the cloud in the future? ("Cloud" in this context meaning the multi-tenant public cloud, not individually hosted software in the private cloud.)
Advantages of the public cloud
To address this question, let's take a look at the benefits of public cloud applications:
Simple and intuitive—cloud services can reduce the complexity of a solution for the user. More and more users expect the same quality of user experience in business as they already get in private use, without any loss of functionality.
Available—Today, constant availability is expected, regardless of location. Cloud services can deliver this at the push of a button.
Scalable—cloud solutions grow with the customer's requirements, without having to resize the hardware every time or initiate complex migration scenarios.
Fast and performant—users expect access to their applications at any time, with consistent performance. Cloud services enable this through their architecture.
Innovative—cloud solutions are always state-of-the-art. Tedious update scenarios are now a thing of the past. Through mechanisms such as "continuous delivery" and "continuous deployment," features and technologies flow promptly and automatically into the software and are immediately available to all users.
The advantages listed above that speak in favor of lean and efficient microservice architecture and, in particular, for replacing monolithic integrated solutions with hybrid scenarios. So it makes sense to use core systems for individual requirements (e.g. in the area of production or industry-specific solutions) on-premises, with extensions for flexible services from the cloud. Such systems can combine the best of both worlds. Of course, standardized interfaces are particularly important here.
...in an ERP environment
For example, SAP AG recommends a two-tier ERP strategy: Classic on-premises ERP with full functionality for corporate headquarters and cloud ERP for smaller branches and subsidiaries. This reduces IT costs in all locations through simplified, standardized processes; costly, expensive roll-out scenarios can be eliminated. Furthermore, in the cloud, the advantages of modern technologies—machine learning, AI, and RPA, for instance—can be combined with highly specialized systems for specific industries.
Conclusion: For many services and functions, it makes sense for companies to make use of offerings from the public cloud. These services are indispensable for keeping abreast of new technologies and trends. Simplicity and scalability should be put at the forefront.
Complex, individualized processes, however, will continue to retain their importance in companies in the future—not all business processes can be mapped without greater individualization. This is just the situation where hybrid scenarios are the best solution. Therefore, when going for the strategy "Cloud first," you might want to make sure it's not "Cloud only"!