Cloud nine for ERP?
This has been a transformative year for the ERP industry, especially with the increasing interest in Cloud-based solutions (also known as Software as a Service or SaaS). This is particularly true for Small and Medium Enterprises (SMEs) as traditional on-premise implementations are comparatively more expensive. Here are five reasons why you should consider moving to the cloud:
1. Real-time data on the go
Information is power. Cloud-based solutions, with the help of reporting/visualization tools within the software, give users access to information at their fingertips. It allows CFOs, managers, accountants and other members of the workforce to analyze data and make informed decisions at any given time through mobile devices.
2. Happy bottom line
On-premise ERPs are considered a capital expenditure since they require a high up-front cost. On the flipside, Cloud ERPs are considered operational costs as they are usually priced on a subscription basis. Although Cloud solutions have a lower initial investment, it is a higher long-term cost. But this is an acceptable opportunity cost for businesses due to the minimum capital expenditure.
SMEs, on the other hand, may see Cloud ERPs as a lower cost in the long term too, because there is not enough volume to efficiently spread the fixed infrastructure costs that come with on-premise ERPs. It enables such businesses to implement a complete solution without a large initial investment.
3. Turn it around faster
With Cloud ERPs, there is a significant improvement in implementation timelines. Cloud ERPs can be rolled out across different regions, departments and subsidiaries without the need for additional hardware onsite and within a span of three to six months. This would otherwise take meticulous planning and preparation for months and sometimes up to a year to implement when compared against On-premise ERP implementations.
4. Focus on value addition
Automating monotonous tasks through ERPs and eliminating the need to focus on maintenance, allows businesses to focus more on value-adding tasks. Employees can gear their focus towards strategic activities which involves data analysis, decision making, and performance improvement.
5. Cloud Economics
Some of the economic benefits of cloud solutions are:
- Instant scalability
- Reduction in direct and indirect infrastructure expenditure
- Elimination of cost from maintaining and running servers
- Including upgrades and administrative activities in the subscription
Author:
Sajini Athukorala
Consultant- Managed Services
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