This year the UK’s cloud adoption rate reached 88%, which means since 2010 it has increased by 83%. With this accelerated rate of growth, it is also not surprising to discover that investment in cloud ERP is also growing. A survey by Panorama earlier this year found that 27% of businesses were investing in cloud ERP, showing the highest numbers to date. Despite this increase, 56% were still investing in on-premise ERP. There are many reasons why an organisation may want to keep their ERP system on-premise – but there are also many reasons why moving it the cloud makes sense.
Here we have taken a look at 6 of the most significant benefits of running your ERP system to the cloud.
This post comes with the caveat that moving completely to the cloud may not be the right move for every organisation – we would recommend engaging with a business like ours to understand your business’ needs and recommend a solution that’s right for you.
Taking a cloud ERP subscription means you can realise significant savings up-front. There is no lump sum initial investment in licensing, as most often you will pay a monthly or annual subscription fee. Not only do you save money on licensing, you also remove the need to invest in new hardware and servers to support and run your software, which can be a significant expense. The monthly subscription model enables you to budget your ERP investment more effectively.
The moving of the software and data off-premise takes the pressure off you and your team to support and maintain the server and hardware hosting the software, with this responsibility lying with an external data centre. An established, dedicated European data centre is likely to have more stringent security and disaster recovery measures than is practical or affordable for your business to sustain.
Hosting your ERP system and data off-premise means that in the event of an incident which may “physically” affect your business – such as electrical problems, accidents or natural disasters – your system does not suffer and your data is not lost. As part of your monthly subscription, you will also likely get data backup and recovery rolled-in, so that in the event something does go wrong at the data centre, your business information is safe. On-premise, you will have to manage your own backup, recovery and disaster recovery plans in the event of an incident – nowadays this will often involve backing everything up to the cloud anyway!
An on-premise ERP implementation can be an incredibly time-consuming project. From business process review and analysis through to initial roll-out, you could be looking at 12-24 months until you are fully up and running. And that is if everything goes to plan. This can make your project seem like a financial black hole to the wider business, especially if it takes this long to actually start delivering value. With cloud ERP, once the initial analysis and planning piece is taken care of, you could be looking at an implementation of just 12-16 weeks. This means you could be up and running with cloud in up to an eighth of the time it would take to implement on-premise ERP. The business will start to realise the value and see actual return on investment within around 6 months – and as you’re on a monthly subscription – the only upfront cost may have been the consultancy time. Wins all round.
With an on-premise solution, growth can be challenging. If you want to add more storage space for your data, or open a new site, you will need to invest in more hardware and infrastructure to support this. Cloud ERP makes this so much easier. You can add more storage to your subscription at the click of a button, and from a geographic perspective, it is much more agile. All you need is an internet connection and a browser, and your new site is connected and has access to ERP. It is also infinitely easier to upgrade to newer versions, without the need for re-installation on-site which could lead to down-time. Not only is it easy to scale up, it is also easy to scale down should you need to. With on-premise, unbundling the hardware, licenses and services can be a decent job in itself. With cloud, should you need to, you can decrease your storage allowance, number of user licenses, or number of modules easily.
Web-based access means a higher degree of mobility and remote access than you can achieve with an on-premise ERP. This can be of significant value in a number of industries, and for a number of roles, where it may be more convenient and easy for a warehouse manager, engineer on the road, or logistics manager to access ERP via a smartphone or other mobile device.
It’s still about the process
We do not want to paint the picture for you that you can up and running with ERP in the cloud at the click of your fingers. The same careful planning a process analysis must go into a cloud ERP implementation as would an on-premise one. You still need to ensure that your business processes are streamlined and fully mapped to your ERP usage. Without this initial piece of work, you will not fully realise the benefits from cloud ERP we have identified in this post. We have extensive experience implementing ERP both on-premise and in the cloud, and with our process-lead approach, we can help you make sure you get the most out of your investment. If you would like to deploy Epicor ERP in the cloud, get in touch.