These days, most vendors offer the ability to deploy their ERP system in the cloud, but that doesn’t mean the traditional on-premise solution should go away. On-premise and cloud-based ERP systems can and do coexist for several reasons:
- Each business is unique with different requirements and circumstances. And those circumstances can vary extensively based on the processes and areas the ERP application is covering.
- An industry’s location, functions or resources might dictate what type of system would work best for companies in that industry. And in other cases, the application requirements of an industry/company will dictate whether on-demand or cloud is best.
- While cloud-based solutions used to be available only to certain organizations, things are changing. As technological advances have made connectivity more stable and available at higher capacities, cloud-based systems are within reach of organizations that have traditionally stuck with on-premise systems.
On-premise or cloud solution?
The decision between on premise or cloud comes down to many factors: budget, deployment options, security, etc.
Key advantages of an on-premise software solution are as follows:
- One-time pricing under some sort of license fee
- An organization might be concerned about access to sensitive information and feel more secure with their information being isolated in their own environment.
- A company might know exactly what they want for a solution and it is simply not offered as a cloud-based configuration. They go with the on-premise option because it fits their business best.
- Some organizations require lots of customization of the software they select, and the comparable cloud-based system is less flexible for such tailoring.
And here are key advantages of a cloud-based software solution:
- Generally, a cloud-based platform incurs a recurring fee, making the initial price of the system much lower than an on-premise solution.
- A cloud-based solution reduces resources for an organization, including hardware upgrades and IT personnel.
- Multi-location access issues are easily resolvable. Cloud-based solutions synchronize invisibly in the company.
- While a cloud-based solution doesn’t give a company complete control of security, security is generally better and at a higher level (and with many more security layers) than the organization would be able to do on their own.
- Disaster recovery is built into the cloud-based provider’s deployment, ensuring instant access to your code and data.
Start with a needs analysis
Before selecting a platform, you must analyze your needs. Those will vary, but here are a few examples of common needs/challenges from past clients of ERP Advisors Group:
- The ability to integrate with existing platforms
- The ability to maintain extensive control over an application’s code and data
- The need to customize and build specific models that might change regularly
- A lack of IT infrastructure in place
- A need for flexibility and versatility
- Industry security protocols
Sometimes a company has a very particular application that suits their needs. Not all applications are available both ways, so the company must go with the application—which they know will meet their company requirements—and accept that it is either cloud based or on premise.
There are many reasons to go with a cloud-based platform, just as there are reasons to choose on-premise software. It really depends on your requirements. Need guidance? Contact the team at ERP Advisors Group today. We’ll discuss your needs and guide you through the process of selecting a solution that fits your organization best.