Cloud ERP Software vs. On-Premise: What’s Right for your Business?

If you are keeping up with the latest business trends you have probably come across “expert” white papers reviewing cloud ERP software vs. on-premise options telling you why dedicated hosting is the best choice for your organization. As ERP consultants who have been a provider of cloud ERP software and on-premise ERP software since 1999, our years of experience offer a unique perspective to provide in the analysis of cloud ERP software vs. on-premise options.  In this blog, we will review important considerations for any business who is asking the question of whether or not cloud ERP software is right for their business.

Cloud ERP Software vs. On-Premise: 8 Important Considerations

Clearly after years of hosting ERP solutions and supporting cloud ERP software and on-premise ERP software, we have decades of research under our caps. Our conclusion is that there is a definitive answer that is applicable to ALL organizations. The numerous factors that go into the analysis of the best choice for your business include, but are not limited to, the following considerations:

1. The nature of the infrastructure being transitioned to the cloud
2. The availability of a multi-tenant solution
3. The cost of the hosting service (whether single or multi-tenant)
4. The downtime on-premises vs. downtime in cloud
5. Upgrade time on premises vs. upgrade time in single or multi-tenant cloud
6. Cost of internal IT vs. cost of cloud
7. Time value of money
8. ROI of other alternative spending projects

The list goes on…

If you read any white papers looking for a definitive answer on what option is best for you - consider the source!! You'll find each white paper is typically totally independent of all of these conditions that affect the customer. The findings of a white paper are usually determined by the source of who wrote it. What services are offered by the author of the white paper or the organization that funded it? The definitive answer is “the product that I sell.”

If any organization offers a definitive solution for all circumstances, then you know the only plausible answer is their services and it is time to run away. Companies do not buy cloud ERP software or on-premises solutions, they buy solutions that address business problems that can be solved either on-premises or in the cloud.

Cloud ERP Software vs. On-Premise: 3 Questions to Ask

In our 15 years of providing both types of services, the primary determinants of which solution is right for a customer are typically the following

1.    How well does the offering meet my business requirements? The decision on whether or not cloud ERP software makes sense for your business starts with considering what fits best  for your unique business requirements. It matters very little whether the solution is on-premises or in the cloud if it doesn’t solve the problems and help advance your company to the next level.
2.    How much value will the organization realize over its evaluation horizon? The second criteria really gets to the point of how well does it solve my problem. Value is typically measured as quantifiable results over total cost of operations over a time period. That period will vary by organization as will the measurements of savings or increased revenue and costs.

Cost evaluation tends to be the diciest in the cloud. In larger organizations where heads may roll as a result of a move to outsourcing, in smaller organizations, parts of people are often discounted as a cost. What value will Bob or Steve produce if he had 2-4 more hours per week? How much does downtime really cost and who measures it on-premises?

3.    How difficult will the transition be to this new solution? Any change is hard. The question is how hard? Will moving to a cloud solution be easier because it eliminates the IT hassles or because of a browser based experience? Some people may be used to a client-server application and may consider that easier just as they considered a mouse really confusing.

Finally be aware that there is no such thing as 100% cloud based solutions.  Unless you are also in the cloud and have no premises, local machine interfacing with the cloud and can magically connect to the Internet…

Do you need more information on the right choice for your business? Call or Email Jan Lawrence, sales executive, at 678-524-9442 or jlawrence@i-bn.net. Visit our website at www.I-BN.com. I-Business Network (I-BN) is a provider of cloud hosting and business software solutions since 1999! We provide business solutions including e-commerce and industry specific solutions for distribution and light manufacturing.

We know that the above is a lot to consider and we want you to have all of the tools necessary to make this journey pain free. Remember to create a plan and work your way through it. Get advice from others in your industry. Call industry professionals like us. I-BN offers a ½ day workshop to help you determine whether you should consider upgrading and outline your value/budget definition!

CONTACT US, CALL US 678-627-0646 or EMAIL US at ibn@i-bn.net and a member of our ERP consultant team will help evaluate your ERP options whether you are outgrowing QuickBooks, another entry level accounting software, or if you need to enhance your exisitng ERP software.

I-Business Network (I-BN) is an ERP and cloud solutions provider since 1999. Established by professionals in the accounting and software industry, I-BN has provided cloud hosting and business solutions including industry-specific solutions for distribution, light manufacturing and professional services. I-BN specializes in sales, implementation and cloud hosting for ERP software. We have deep experience and knowledge of Sage 100 ERP and SAP Business One software and understand its unique requirements and the support that you will need. Our national network of business software solution providers enables us to provide a local presence for training, implementation and support.