Top 5 Key Differences between On-premises ERP and Cloud ERP solutions

Clickon Gadget
Mar 7, 2019 · 4 min read

Benefits of Cloud ERP solutions over On-premises ERP

If you are looking to automate your organization’s workflow, then you probably come across Enterprise resource planning (ERP) term in your close business circles. Certainly, always there is a bombarding between on-site ERP and cloud ERP solutions when it comes to selection. ERP is an automated solution that connects all the departments of an organization. It helps in improving operational efficiency, controlling costs and thereby increasing profits.

The basic difference between On-premises and Cloud-based ERP is in how the software is deployed and accessed. On-premises ERP software is installed on computers and servers that are owned, or leased, by the organization. Cloud-based ERP is deployed on the cloud (servers are owned or leased by the vendor) and accessed through a web browser. Cloud-based ERP systems are usually SaaS (Software as a Service) products where the service includes software and the infrastructure it runs on.

Source: erpinnews

Let us look at some of the differences between On-premises and Cloud-based ERP solutions. This article provides you a gist on how to select the best ERP solution that meets your business requirements.

Cost and time:

On-premises ERP solutions need higher investment up front to purchase and manage the software. If your organization does not have an IT team, you have to hire the right people to manage the system before you deploy it. You can consider On-premises ERP as capital expenditure. Setting up the infrastructure and deploying an on-premises ERP system is a time-intensive and cost-intensive process.

Cloud-based ERP systems are already set up and deployed on the cloud. You normally pay a subscription fee which includes hardware and software costs. Assuming everything else remains the same, this cost is generally lower than the costs associated with an on-premises option in the long run. Using a cloud-based ERP can be considered operating expenditure, where you pay for as long as the services are utilized. Compared to on-premises systems, cloud-based ERP solutions takes less time to deploy.

Customization and mobile access:

Customization and mobile accessibility are considering aspects of an ERP system. In the case of On-premises ERP system, it offers a great level of customization. But the process of customizing the On-premises ERP can delay the implementation process. As the ERP vendor rolls out new software updates and enhancements frequently, your existing system may go passive. The On-premises ERP is not readily available for real-time data monitoring by your employees and stakeholders.

Source: CIO

In the case of cloud-based ERP system, the VAR (Value Added Reseller) will do the customization according to the company’s requirements. Your Cloud ERP system will be updated automatically with the latest updates and security patches. The end user can avail the Cloud ERP system through native mobile apps.

Data security and ownership:

In the case of On-premise ERP system, the organization holds the data security and control over it. But, sometimes due to lack of implementing the adept data security protocols and supervision leads to malicious attacks.

In the cloud ERP system, the data is hosted on the vendor’s cloud and can be accessed through a web browser. To safeguard the data companies will opt for encryption methods to enhance the security. The cloud service provider will update your system automatically to make sure that you are working in a secured environment.

Integration and Scalability:

Integration is one of the daunting factors to consider while choosing an ERP solution. In the case of on-premises, you need to pay much attention and time to integrate the new version with the existing legacy system. Sometimes, it may go void if the integration process is not done well. Whereas, in cloud ERP systems, the service provider will look after the integration process that delivers a seamless working experience for the client and end-user as well.

Scalability is all about your ERP’s flexibility with the eventual growth of business operations and the number of users. Cloud ERP solutions enable a great level of flexibility despite the increase in the number of operations and users. Perhaps, on-site ERP solutions don’t offer the same extent of freedom for the number of users. Often, you need to deploy additional hardware to handle it.

Training and support:

The On-premises ERP system needs extensive training and technical support to the employees for a long time.

In the case of cloud-based ERP systems, the service provider will support the technical team to manage the IT functions and supports in fixing the technical aspects.

Source: Magzter

Above are the top 5 traits of Cloud ERP software that drive more business growth and effective automation.

In recent times, the cloud-enabled ERP systems have become a prominent solution for an organization’s workflow automation. We at Amzur offer cloud-based NetSuite ERP solutions for our clients delivering the best-in-industry experience. Our top-notch technology integrated NetSuite ERP solutions will configure all your business modules to have an intuitive workflow.

Click here to get a NetSuite consulting solution

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Data Driven Investor

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