The Benefits of the Cloud Vs an On-premises ERP Solution

 In Blog, Business Intelligence, Industry Trends

Talk of the cloud is everywhere these days. Cloud computing continues to improve, and more and more services, subscriptions, and products are transitioning away from physical or on-premises versions to cloud-based ones. As a product-minded manufacturer or distributor, you’ve probably wondered whether or not you should do the same when it comes to your ERP solution.

There are certainly some perks that on-premises solutions offer. It’s always reassuring to be able to actually see your server (all those flashing lights are proof that something’s happening), and when problems crop up, finding the source is potentially easier when dealing with an on-premises solution.

When you take a good look at the advantages that cloud-based solutions bring, though, the reasons for sticking with an on-premises solution quickly lose their significance.

Let’s address a few reasons small-to-medium sized businesses give for keeping their on-premises ERP solution rather than migrating to the cloud.

The cloud isn’t safe.

As we’ve discussed previously, this simply isn’t true.

The good news is, our collective fear of cloud technology as a whole is waning steadily, and when we take a look at the reasons behind this fading fear, it seems a bit laughable. Cloud technology is here to stay, and it isn’t going to harm us. In fact, it’s going to help us — a lot.

I don’t need to move to the cloud.

Think for a moment about how much communication has changed over the last 20 years due to the advent of the cell phone and mobile technology. Back in the land-line era, if you left your house for a day at the beach and realized you needed to contact your office right away, you had to either return home or navigate to a pay phone and hope you had enough coins in your pocket to be able to use it (or worse — drive into the office on your day off). Today, though, you have the power to contact anyone in the world, whenever you want to, provided you remembered to charge your battery.

The business world isn’t far behind. While it’s still fairly common to only have access your company’s operational systems while you’re at the office/warehouse, this won’t be the case in a few years. Companies who aren’t prepared to compete in a mobile environment risk being left behind.

Another compelling reason to consider moving to the cloud is that cloud technology is more scalable than on-premises solutions. Access to cloud server and storage space is constantly increasing, and cloud systems cost less for you to maintain and operate because your service provider is primarily responsible for system maintenance. There’s no need to worry about keeping your servers up-to-date and secure, either, since your service provider will take care of this too, which helps your equipment costs drop significantly.

You’ll be able to shrink your IT payroll, your carbon footprint will go down, and with those savings, your company has the potential to experience as much as 20% growth as a result.

While your current, on-premises ERP solution might be working for you right now, it’s likely to hold you back as your company works to compete in today’s rapidly-changing marketplace. By proactively making the switch to cloud, you’ll be one step ahead of your next set of challenges.

It’s too expensive for me to move to the cloud.

No matter how you slice it, switching ERP systems is going to involve some up-front costs. However, the long-term benefits of migrating far outweigh the potential costs, provided you can keep these costs under control.

One way to help mitigate implementation costs is to be thoroughly prepared for the challenges you’ll face when you transition between solutions. There’s nothing worse than realizing halfway through a complete system migration that you weren’t prepared for some of the major hurdles involved — when searching for your cloud-based ERP provider, make sure they provide you with an approachable implementation team dedicated to helping your company successfully make the switch. You’ll be glad you did.

Beyond being prepared and receiving help from your ERP provider (once you’ve chosen one), the best way to be sure you don’t spend any more money than is absolutely necessary is to be very thorough in your research as you explore your options. Become intimately familiar with your current business processes and what you need from an ERP solution in order to improve those processes. Bring in another set of eyes to ensure that you thoroughly understand what you need in your next ERP solution. Schedule demos with multiple providers, and budget time for testing your different options. You don’t want to be looking for a new solution in a year or two — you want one that will grow with you and complement your business.

If you need a little help figuring out exactly what it is you need out of your ERP solution, we’ve put together a guide to avoiding some of the major pitfalls.

The decision to move from your on-premises ERP solution to the cloud is ultimately up to you, but the benefits of the cloud are clear. Sure it deserves some serious consideration, but fear or reluctance to change could hold you back from where technology is taking us. If you have more questions about how a cloud-based ERP would work with your particular company, reach out to us! We’re eager to start a conversation with you.

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  • Freedom Software

    Very good explanation about the benefits of Cloud ERP over On-premise. Nowadays every businesses either small or medium are slowly moving towards cloud ERP for its more beneficial features, but some organizations are still not completely aware of such benefits, this is a good article for them to understand and take a step towards success.

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