Cloud-Based ERP V/s On-Premise ERP - Which One Is Better For Your Business
31290 10/14/2014 Business 294 /The latest buzzword that is doing rounds in the IT industry is the Enterprise Resource Planning (ERP). It has helped several organizations to augment their productivity, combine internal and external information across the enterprise and incorporate that data with accounting and sales. As per your organization’s requirements, you can always decide on the type of ERP you want like cloud-based ERP or On-Premise ERP.
ADVANTAGES OF CLOUD-BASED ERP –
• NO-Server Maintenance:
If you use cloud-based ERP system, limited or no internal IT resource is required. You do not have to maintain your hardware or software resources. The overhead costs such as that on electricity, maintaining servers and paying rent for building is mostly eliminated. Otherwise, the internal IT department of your organization is exempted from looking after servers, networking and operating systems. They can now concentrate on much more relevant and core businesses concerning the organization.
• Low Initial Investment:
If you resort to on-premise ERP, you need to splurge extravagantly on buying, housing, configuring and maintaining servers. The spending will not end here! You still need to man the department with professionals who would look after the ERP set up efficiently.
• Improved ROI:
One of the prime benefits offered by cloud ERP is that it allows a number of applications to run across multiple databases and servers to be used within a given business environment. The quick and easy deployment of cloud ERP leads to better results and faster payback. Unlike in the on premise ERP, the customer is charged on a monthly basis as per the operating expense instead of treating it as a capital expense in a cloud ERP. This surely improves a company’s cash flow.
• Superior Integration with Other Systems:
For easy interoperability, the cloud has the option of current or future usage of additional products. With this system in place, you can easily customize and upgrade the current product as and when the need arises in the future.
• Faster Implementation:
Though the implementation time in a cloud-based ERP varies as per the project size and scope, but when compared with the on premise ERP, the implementation time tends to be less.
• Data Back-ups:
If you have a cloud ERP in place, your data is stored in at least two locations. In any undue circumstances, if your server gets crashed, you can always retrieve it from the other end.
DISADVANTAGES OF CLOUD-BASED ERP –
• Security Risks:
The security and confidentiality threat are considered to be amongst the top concerns in a cloud-based ERP. This threat is perceived to affect more to large enterprises rather than SMEs.
• Compliance Risks:
The regulations pertaining to data, energy, environmental standards are designed without giving the peculiarities much of a thought.
• Strategic Risks:
Cloud ERP is often outsourced to a third-party vendor which makes you dependent on the service provider.
ADVANTAGES OF ON-PREMISE ERP –
• NO Potential Threat of Data Leaks:
When software is hosted on on premise, there is a negligible risk of anything being leaked out of the security walls. A company has a lot of confidential data at hand, so all such data is securely saved on these servers.
• All data in Company Control:
You can ask for any data at any time of the day in an organization when you have on premise ERP as your ERP Software System. At times, company may require immediate access and with this system, you can get the information you want quickly.
DISADVANTAGES OF ON-PREMISE ERP –
• Large Initial Investment:
For start-ups, initial costs are heavy to set up the in-house ERP system and a lot of amount is spent on maintenance.
• Diverts the Attention of Internal IT Department:
The in-house IT department puts other core internal issues on the backburner for keeping the on premise ERP servers alive.
• High Up-Front Costs:
You have to pay for all the servers and infrastructure that you may need or may not.
Thus, both the ERP software systems are beneficial to any organization. You just have to decide which kind of ERP will cater to your business needs.
For More Click : http://clientsfirst-tx.com/service-offering/cloud-based-erp-solutions/
Article Submission FREE !!
Post Article, Add Article, Submit article in Business - Business category for FREE to Search Engine Marketing.