Have you considered moving your ERP solution to the Cloud? If so, you’re not alone. Companies around the world are beginning to the see the value in Cloud computing, and Cloud adoption is on the rise. Even manufacturers (who were skeptical at first) are beginning to embrace the Cloud for the flexibility it offers. Companies wishing to move to a more mobile enterprise or reduce their hardware costs are looking to the Cloud; however, before you make the move, it’s important to have all of the facts. While Cloud ERP certainly has its benefits, it may not the right solution for your company.
If you are trying to evaluate whether or not the Cloud is the right fit for your company, we have developed a list of pros and cons regarding Cloud ERP solutions to help you make the most informed decision possible.
Pro’s:
- Reduced Costs – While the long-term costs of Cloud and on premise solutions are comparable, Cloud software solutions can free up your cash flow up-front in terms of hardware, IT and maintenance costs. When your ERP software operates in the Cloud, you don’t have to worry about investing in new hardware to get the system up and running. Your Cloud provider is responsible for all maintenance costs – including servers, networking, and operating system software support.
- Improved Cash Flow – As we mentioned in the point above, Cloud ERP solutions have reduced up-front costs in comparison to large on premise systems. Rather than investing all of your money into the solution up-front, the Cloud makes it possible to break up your investment over a period of time, thus improving your company’s cash flow.
- Seamless Integration with other Systems – The Cloud was purposely designed to support interoperability. By using ERP software in the Cloud, you have the option to add on additional products and seamlessly integrate them with your ERP system.
- Supports Mobility Options – The Cloud makes embracing mobile technology easier. With Cloud ERP, you can set up mobile options and access your company’s important data directly on your tablet or smartphone.
- Data Backups – With the Cloud, you don’t have to worry about your in-house servers crashing and losing important data. All of your data is stored in the Cloud and copied to at least two locations so you can rest secure knowing your data is available even if one fails.
Con’s:
- Security risks – The Cloud brings new security issues to the minds of businesses. With on premise software, all of your data and information is contained within your company walls. However, with Cloud ERP, the Cloud provider has access to and control of your company’s software and server. Before you decide on a Cloud provider, make sure you thoroughly evaluate and set the level of control in your service level agreement.
- Total cost of ownership (TCO) – While paying a low monthly subscription cost can certainly free up your company’s cash flow now, those prices can add up over the long-term. Eventually, the costs of Cloud ERP could surpass those of on premise.
- Limited data control – If your company desired to keep sensitive and regulated data localized, then the Cloud is not the solution for you. If you need to keep sensitive data in-house, on premise ERP solutions would be a much better fit.
Keep in mind that the implementation times of Cloud ERP and on premise ERP are comparable. While you may not have to install software on the actual server, you still have to invest a significant amount of time configuring the software, training your end users, and customizing reports and forms. Switching to the Cloud because you think it will be faster to implement will only result in frustration.
Overall, the decision to move to the Cloud is a personalized decision. Does it make sense for you company? Are you as comfortable with the cons as you are with the pros? Knowing your facts before you make your decision is important.
Now that you know the facts, it’s important to make your investment worthwhile by doing some prior planning. This can help you eliminate time delays and errors so you can get you system up and running quickly. We’ve provided five tips designed to help you ensure the success of your Cloud ERP investment:
1. Write down your business requirements and expectations from the software.
2. Make sure you understand what Cloud ERP actually costs.
3. Decide if you want a public or private Cloud.
4. If your IT staff doesn’t have the capability to implement your Cloud ERP solution, hire the right people to do the job.
5. Prepare a business continuity plan for unplanned events.
So is Cloud ERP worth the investment? It depends on your company’s needs and desired. If you think the Cloud may make sense for your company, give us a call today. We’d be happy to discuss your particular ERP situation and align you with a product designed to meet your company’s unique needs…whether that’s for Cloud or on premise software.