Deciding between cloud ERP and on-premise ERP

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So you’re planning to transfer all your company’s data to the cloud, but you’re not sure which ERP system to go with? When looking at ERP solutions, you can figure out which is the best for you by considering the pros and cons of each kind. There are many differences between cloud-based and on-premise systems, and each system functions in its own way.

On-premise ERP

On-prem ERP solutions allow you to buy as many software licenses as you need, depending on the number of users you’ll have on your system. This software will then be downloaded onto your company’s server. Software licenses are a one-time purchase, but you’ll need to pay extra for any additional modules. However, on-prem ERP solutions cost more to maintain because of updates and support, so keep that in mind when choosing a system.

Choosing an on-prem ERP system means all your data will stay on your company’s hardware. As such, your IT team can monitor it closely and notify you immediately if any changes are made to it. ERPs can store plenty of sensitive data, such as client and employee information. Hosting your ERP on-premise means you’ll have greater control over physical access points, which will prevent outside access to its contents.

You’ll be less dependent on a vendor if you choose an on-prem system because it’ll enable you to make business decisions on your own. You’ll also have the ability to implement any technology on your own terms. On that note, going with an on-prem system means you’ll also get applications tailored specifically for your business.

Furthermore, a physical IT infrastructure will not be dependent on the internet in order to function, so you can rest assured that you’ll still be able to access your data even without WiFi.

An on-prem system will give you greater control over the data you store, who can access or edit it, and what can be done with it. You can also choose to deploy updates or not and upgrade to reduce the risk of unanticipated downtime. An on-prem ERP system is also more secure, which should be a priority to you, no matter what industry you’re in.

Cloud-based ERP

The biggest difference between an on-prem system and a cloud-based ERP lies in their payment schemes. While the former can be paid for upfront, the latter is usually offered as a subscription—which means you’ll have to pay for it more than once. Subscriptions can come with different terms, like annual and monthly payments. If you go with a cloud-based ERP, you’ll end up paying more in the long run.

The best thing about this kind of ERP is how convenient it is. A cloud-based system will allow you to access your data anytime, anywhere, as long as you have an internet connection. However, it must be noted that your data will be stored on the cloud, which means it will be on another party’s servers, not your company’s.

Accelgrid provides industry leading ERP software for SMEs – get in touch today to see how we can help.

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