Which ERP Solution is right for you?
Cloud technology suits many organisations because it offers enterprise-level software at an affordable monthly price and the flexibility to easily scale up and down. If you’re considering an ERP system for your business, the chances are you are overwhelmed with the copious amount of options. You will have to choose a solution that is cloud-based, installed locally on-premises – or hosted.
Types of ERP solutions
There are basically three ways for ERPs (Enterprise Resource Planning) solutions:
The cloud solution is accessed via the internet and is paid on a subscription basis – either monthly or quarterly or per annum. You will not own the software but are licensed as the end-user. It is provided as a service or more commonly known as Software-as-a-Service (SaaS). MYOB Advanced Business is an example of a cloud solution.
The software is installed physically on a server, usually on the client’s business premise. Licenses are sold on a perpetual basis and are treated as a capital expenditure. Compared to a cloud solution where it is an operational expenditure. Hosted Solutions In this scenario, the software is installed on a server hosted by a third party. It could be installed on a dedicated server or a shared server, depending on the requirements of the client.
Which ERP Solution is right for you? What to consider?
On-premise ERP solutions usually involve substantial upfront investment and additional ongoing cost to purchase and manage the software, hardware, server, and facilities. There is also a requirement for IT resources to maintain the entire system and solution. Cloud-based ERP solutions are usually much lower in upfront investment as there is no technical installation required. The ERP is hosted and the IT infrastructure is taken care for you, which means that you have a lower running cost. The subscription model also means that you have better cash flow management.
ERP Updates and Upgrades
Upgrades and updates for on-premise solutions are usually not straightforward and may require you to spend time, resources, and money to perform the upgrades or updates. Some companies avoid it and settle for outdated technology because of the complexity. Cloud-based ERPs are automatically upgraded by the provider and require no effort from you. In the cloud, regular updates would not affect your customisation and integration, saving you cost.
Cloud-based ERP solutions are easy to add users, features, and processing capacity as there is no need to purchase additional servers and hardware to cater to the add-on. Functionality Cloud-based ERP systems can interoperate with other cloud-based software platforms, which makes them more attractive to work with from a third-party developer perspective. This means that the functionality footprint of a cloud-based ERP can expand easily and more rapidly compared to the on-premise system.
Cloud-based systems can be accessed from anywhere, anytime, and from any device while on-premise solutions may require additional setup for remote access. Ease and speed of installation Cloud-based ERP solutions do not require technical installation of hardware or software making it very fast to set up and install. On-premise solutions require technical installation and configuration of hardware and servers, SQL database, ERP system, the configuration of PCs, and more – which means that it takes a longer time frame to set up.
If you are evaluating an ERP, you will have to consider the above factors prior to making a decision. For more assistance, feel free to contact us for a personalised discussion on which ERP solution is right for you.