The 5 Hidden Economic Benefits of Cloud ERP

PostedOn: 2016-12-01 12:48:32

The cloud has been a major topic of discussion among manufacturers over the past few years. With good reason too: it has definitively proven its financial value. Visibly, the cloud offers convincing ways for manufacturers of all sizes to reap cost savings, especially when it comes to capital spend. But cloud ERP promises still more monetary win falls that aren’t quite as obvious. Just consider the following: 

1.Less Investment Production

With conventional, legacy on-premise ERP, there is a large upfront capital investment in hardware, servers, and communications. Cloud ERP, on the other hand, is managed and maintained by software and hardware experts in large, secure data centers. Manufacturers simply pay for the service they need. Subscription-based pricing is “pay as you go,” providing the option to decide how much or how little functionality to buy. This involves very little upfront costs.

2.Earlier Expansion

Once cloud ERP is active, manufacturers merely need an Internet connection to add new users and locations. Because there is only one occurrence of ERP software shared across the enterprise, they can both add and fully integrate new production locations quickly. There is no software installation new locations are merely added to the database and connect to it via the Internet. 

3.Transportation Cost Savings

As mentioned previously, cloud ERP offers a massive opportunity for infrastructure savings. From servers to database systems to middleware, the costs to replace, upgrade, and maintain a traditional ERP system can be a massive hit to IT budgets and resources dollars that can even be funneled back into the budget to fuel innovation. Cloud eliminates the need to manage infrastructure, maintenance, or software versions and fixes.

4.Quicker Return on Investment

Cloud ERP is much faster to deploy than traditional, on-premise systems. With no upfront capital investment and no software to install, manufacturers can start benefitting from ERP capabilities quicker.

5.Enhanced Chance Costs 

Software loses value if it’s not routinely upgraded. Unfortunately, most manufacturers don’t upgrade with every new release, lessening behind by a few revisions. They could be missing out on new features until that next upgrade, which could be years down the road. Cloud ERP is version less, adding constant value with real-time enhancements that can be used immediately. With no upgrades and no ERP software or hardware preservation to manage, manufacturers can get out of the IT business and focus more resources on production and driving results.