One of the most significant business decisions manufacturing and distribution companies make once they decide to adopt an ERP solution is whether to deploy an on-premise system or a cloud ERP solution. If the team has not yet embraced the cloud for mission-critical apps, it’s comprehensible that there might be some initial hesitation to choose it for ERP. Here are some considerations for teams trying to decide about making the move to the cloud for their ERP.
If you go with an on-site deployment you will need to pay for both the cost of the ERP and the cost of any hardware it requires. You will also need to take on the cost of housing, managing and maintaining that hardware, which can warrant significant time and costs. When you rely on cloud ERP to handle things like supply chain management and global financials, there isn’t a need for your team to invest in hardware. The cloud also allows for easy upgrades of technology systems in a major way, without exploding the budget.
It is a misconception that the cloud is less secure than on-premise systems. If a team decides to implement an on-premise ERP system, there will likely be a need to hire your own security professionals or divert the IT staff you already have.
You’re evaluating ERP because you consider it an asset to your company. But once your company starts to grow, the capabilities of your original ERP may no longer be able to adapt to your business changes. Cloud ERP has the major advantage of being rapidly scalable. If and when you need to grow or change your capabilities, you can do so quickly and precisely. That is substantially harder to do and more expensive with an on-premise ERP system and in many cases may not even be possible.
Once your team gets on-board and starts to rely on the company’s ERP they will want it’s features to travel with them wherever they go. If the team relies on an on-premise ERP system the data inside the ERP is essentially trapped at your location where it isn’t accessible to team members working from the field, from home or during meeting with customers.
With an on-premise ERP, while you can control how the system is maintained and supported, the responsibility for keeping the hardware up to date and supporting any system needs will also need to be managed. This large responsibility often leaves IT stretched thin, while making it difficult for people across the company to get the help they need. A lot of the heavy lifting of system support can be taken care of with cloud technology.