Choosing Between On-Premise and Cloud ERP Software

October 24, 2016

Choosing Between On-Premise and Cloud ERP Software?

Collaboration and coordination of business processes through ERP software is the key to staying competitive these days. While functionalities remain the same, many purchasing organisations struggle to make a choice of choosing between an on-premise solution or offloading business critical functions to the cloud. For every business trying to make a decision of deployment requires understanding the  fundamental differences and each difference comes with a whole host of reasons that justifies going with on-premise or cloud-based software.

This article provides you different pros and cons of each ERP deployment type to guide through the decision.

On-Premise Solution

On-premise solution is a traditional deployment method where servers are connected, and operating systems are installed along with other hardware for a one-time license fee. It is operated within the company’s datacenter maintained by the IT department. It is considered as a company’s capital expenditure.

Pointers Pros Cons
Cost Model Cloud options give an advantage of predicting costs and is a much cheaper investment for a company.It does not require any additional hardware installation, hence cost savings can be made. . Over the course of time, the cost may be up more than an on-premise solution.
Security Service provider offers greater stability as he retains all the security of a company’s data.He also provides continuously timely updates for better protection. Security is expensive and has to be maintained 24×7 which some providers fail to provide.
Customisation Cloud solutions comes with very few customisation options.
Compliance Cloud providers have a dedicated team of compliance who constantly meet and maintain obligatory laws and regulations.
Implementation It comparatively takes less time to implement as a result of less customisation.

Cloud Solution

Cloud solution is one that a service provider offers within their datacenter with a mandatory internet connection and are contracted for a certain time-period maybe monthly or annualand customised specifically for an individual need. It is usually considered as a company’s operating expenditure.

Pointers Pros Cons
Cost Model It requires only one-time investment and zero additional subscription costs. High upfront investment can be difficult for a company to manage.It involves paying for hardware installations and on-going support and future hardware upgrades
Security Since security is critical; it provides more infrastructure control and data-security.
Customisation On-premise solutions offer maximum customisation options of adding plug-ins as one may see fit. Customisation over on-premise method can delay overall implementation.
Compliance Since it is run by a company itself, strict compliance with all the laws and regulations has to be taken care of.
Implementation An organisation can have complete control over implementation process. Normally, on-premise implementation takes longer than the other type.

From a cost standpoint, SMEs with tighter budgets can leverage cloud-based ERP services and get enterprise-class solutions. The cloud- based will also provide scalability as your business expands. The traditional on-premise option stores data internally on a local server and is perceived to provide added security with business intelligence housed behind an internal firewall. Talk to our expertds to-day to help up choose what the best option is for your business.Give us a call on +44 – (0) 203-872-5140 or e-mail at info@silvertouchtech.co.uk to get a smart and affordable IT solution dor your business

SAP provides both on-premise and cloud-based deployment options for SAP Business One. Get your free demo and an e-book on Business Management Made Simpler.

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