Cloud-based business systems are maturing and are rapidly becoming entrenched in IT departments across the country. More than half of US companies now use some form of cloud technology and many more are making plans to move additional systems to the web. Organizations that began with simple cloud-based reporting are now moving toward putting their core software on the web including cloud accounting systems and cloud ERP.
Companies that have installed enterprise resource planning (ERP) software have already realized the benefits of sharing data across functions, including standardizing processes, controlling costs and providing more data visibility. Traditional ERP solutions are often housed on a company’s own server infrastructure. However, the ERP software market is going through a revolution driven by the accessibility and scalability of cloud solutions. Cloud-based computing enables the considerable agility that is needed in today’s fast-paced business environment.
Cloud ERP Software Enables Business Agility
Cloud ERP may not be the best choice for every company. See this blog to determine your readiness for cloud ERP software: 5 Key Considerations for Cloud-Based ERP Software. However, if you are considering a cloud-based solution, these are the benefits you can expect to realize from moving your core systems to the web.
With a cloud-based ERP model, upfront costs and on-going maintenance costs are reduced providing a faster Return on Investment (ROI). If you do not have an internal technology infrastructure or your own IT team to maintain your software, a cloud-based model offers a more cost-effective means to implementing an ERP. On-premises implementation projects are more likely to go over budget with unforeseen costs. When your ERP is hosted elsewhere, you greatly reduce the cost needed to keep your technology infrastructure current.
Faster Implementation and Upgrades
Because you do not need to purchase and install on-site technology, the cloud-based ERP installation can be executed more quickly with less disruption to your business. With the web-based model, you receive new features and functionality as they are available because you can automatically receive updates from your vendor. One study found that implementing web-based ERP, on average, took only seven months compared to eleven months for an on-premises solution.
More Flexibility, Scalability and Accessibility
A cloud ERP provides access from any device on any platform without expensive software or customization. This model is especially valuable when you have multiple locations that need access to real-time updates and reports. Cloud-based systems increase the ability to collaborate among a global workforce, enable more agile decisions and promote common organizational standards.
Enhanced Security and Backup
While security is a concern for any system connected to the Internet, your data can be even more secure when hosted by a provider who can provide the latest technology to secure facilities and networks. A capable hosting site will also include disaster recovery plans.
There are valid concerns that need to be addressed when considering a move to the cloud. These three concerns are the primary reasons companies choose to keep their ERP system on-site. A robust cloud ERP solution can mitigate and eliminate these concerns in most cases.
The main concern most organizations cite as their reason for not moving to a cloud ERP is security. These companies are concerned with the safety of their sensitive data. This is a valid concern that should be addressed with your ERP vendor and hosting site. The key question to ask is whether your data will be more or less secure at the hosting location.
Lack of Control
Another reason companies may choose an on-premises model is that they wish to control their software and the upgrade process. This is often due to concerns about the need to highly customize their software to address unique process requirements. This is a concern that you should address with your vendor as cloud-based software can be customized to meet specific needs.
Finally, companies are concerned about being reliant on a high-speed Internet and an external hosting site for system uptime. However, data show that externally-hosted sites are, on average, more reliable than internal systems.
Whether you are looking for a cloud-based or on-premise ERP, we have a product designed to meet your needs. Contact us today to learn more.