4 Ways Cloud ERP Is Better Than On-Premise ERP

Business have been heavily relying on the Enterprises resource planning (ERP) systems as they help in saving a lot of time and money for the companies. They offer bundle of benefits to the business and help them to get an integrated and real time view of various business processes. Additionally, cloud computing programs are gaining popularity owing to its multiple benefits. 84% of CIOs had reported that they were able to cut the application costs by moving to cloud. Cloud ERP is the result of amalgamation of both and has proved to be very useful for the business.

Why to opt for cloud ERP

Traditional ERP solutions are installed on servers and hardware of the company and are generally managed by the IT staff of the company. On the other hand, cloud ERP is based on the cloud and relies on cloud just like SaaS. To state it in simple terms, it is a suite of ERP apps that are delivered to the users over the internet connection which can be accessed by a browser.

1. Reduces operating cost

This form of ERP is highly admired as it reduces the operating cost to a large extent. The implementation and maintenance costs are negligible as generally all the aspects are managed by the providers. Moreover, only a certain amount has to be paid as a monthly fee for the usage charges as the services are offered on the subscription basis. Moreover, it also eliminates the need of making huge investments to acquire the hardware and IT qualified staff to install and manage the software. The research done by an industry analyst confirms that the cloud based ERP costs about 50% less than the traditional ERP for a 100- employee company. More importantly, you can deploy your IT staff to carry out the activities pertaining to your business as this ERP won’t consume some time and efforts as all the aspects are managed by the vendor. Hence, deploying it can significantly drop down operating costs.

2. Faster implementation

The implementation is a way faster as all the information relies on the cloud. It reduces the initial costs of implementation as it doesn’t require a real setup and all the responsibilities are carried out by the provider. The major parts of the systems are generally preconfigured and can be quickly integrated into the business process. This makes the implementation really fast. Moreover, the deployment becomes quick as there is no need to waste time in procuring and installing IT software.  Hence, the majority of the companies are moving towards cloud ERP as the implementation and operating becomes hassle free. The research done by Forrester confirms that Cloud computing expenditures of the companies are growing at the rate of 20% per annum. This clearly indicates that the companies are shifting towards the cloud.

3. Improved performance

It enhances the overall performance of the system as there is no need to setup for ERP within the premises and maintain them. If the servers are not maintained and operated properly then it can result in a drop in the performance of the ERP solution. However, for the cloud based solutions the problem would never arise as it would only require steady internet connection as the rest of the aspects are managed by the providers. Additionally, the system upgrades are really difficult and time consuming in traditional ERP as every time the upgrade occurs IT professionals will have to start from scratch. However, there is no such problem with the cloud ERP as the upgrades are really easy. The research done by Forbes found that, 60% business leaders stated that they had reduced their expenditure on IT maintenance after implementing the cloud ERP which allows them to focus more on business agility. Having cloud solutions will help you to enhance the overall business performance as it allows you to focus and concentrate on the activities that matter the most for your business.

4. Improved accessibility

It becomes easier to update the module as updates are comparatively easier. Hence, you can easily access the latest and greatest features. With the help of cloud ERP it becomes quicker and easier to get the desired details as the information can be easily accessed even outside the office premises just with the help of internet. It allows you to get real time information on your laptops or smart phones without incurring any extra costs. Furthermore, it also guarantees enhanced security over other options. Hence, owing to all the right reasons it was correctly predicted by Forrester that the market share of cloud ERP will increase by 21% till the end of 2015.


In order to thrive in the fiercely competitive market, you have to be very agile while responding to the needs of the customer. Implementing cloud ERP will empower you to focus more on your key strengths as it makes the operations swifter and easier. Deploying it can do wonders for your business and help you gain competitive advantage over the competitors.

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