When it comes to choosing an ERP system (Enterprise Resource Planning) for a company or business, we find a multitude of options available. But undoubtedly, one of the main criteria on which we base our decision will be whether we opt for an ERP cloud solution or a locally installed system.
The main difference between both alternatives is clear: the option of a local installation tool uses the resources (servers and / or computers) of the company itself, in addition, its management and maintenance are also usually the responsibility of the company. On the contrary, ERP cloud software is offered under an SaaS (acronym for Software-as-a-Service) format, which means that both the “program” itself and the data created with it are managed centrally by the provider and are hosted on their servers, so access to the tool is done through the Internet, from any browser.
Choosing between one or another option can make a big difference when implementing this type of systems in a company. Thus, we review some aspects to take into account that will give us a clearer vision.
Cost of a cloud ERP vs local ERP
The formats of local installation ERP systems usually require a greater investment, both at the time of implementation, contracting the software license itself and acquiring the computer equipment that supports it, as well as its maintenance.
And, if the company does not have a technical department that has the ability to manage the tool, it will be necessary to train one or contract the support externally. And even more important, it will require an investment of time and budget for the continuous operation of the tool, including hardware maintenance. Each time the software receives an update, the department or responsible person will have to carry out the implementation in the whole system (central server and terminals of each user), as well as, if necessary, reactivate the customisations made on the program.
On the other hand, the initial costs of cloud ERP solutions are usually much lower, because they only need an initial configuration adapted to the needs of each company, to make access to the program via Internet. The software provider is also responsible for hosting and maintaining the technical infrastructure that supports it, making sure that it is always accessible, the security of the data and that the updates are made without detriment to that customised configuration.
This lack of need for technical maintenance by the company itself is usually the determining factor in using the ERP format in the cloud compared to the local installation. In addition, in the first the costs are known in advance, since they are usually offered under a periodic subscription model, based on the number of users and collaborators, of modules that provide additional functionalities, etc.
With all this, the figures of the sector estimate that the saving of a system in the cloud compared to self-installation can reach 50% of the total cost, in a period of about four years.
Quick integration of an ERP in the cloud vs local ERP
Incorporating a resource planning system in a company is a process that requires careful organisation, but a ERP cloud software element comes with the advantage that implementation will be much faster.
As we have already mentioned, the cloud-based solution does not require the company to acquire or configure any type of computer equipment. In fact, the tool can be easily implemented even if the company is organised in multiple divisions, territorial centres or subsidiary companies, with the cost savings that an installation for each element would entail.
ERP cloud vs local ERP software performance
Related to the previous point, another of the advantages presented by the ERP cloud is the scalability factor, that is, the flexibility offered by the providers of these solutions to increase or reduce the capacity of the software, either in the number of users or in the treatment of data.
This is possible thanks to the fact that, compared to the local installation format, the computer systems are optimised so that the operation of the program achieves maximum performance. And so it is that the architectures that support “the cloud” adapt dynamically to the resources required at any time, being able to cope with any load “peak”.
It is also worth noting that ERP cloud solutions offer access to the data that it handles in real time and can be consulted from any place and at any time. This means that employees have all the information at their disposal from their laptops or mobile phones, wherever they are, without additional costs.
Security and trust of an ERP in the cloud vs local ERP
Within the selection criteria of an ERP or other format, it must be taken into account that, in the case of the independent installation, practically all the management “stays at home”, and security will depend mainly on ourselves.
Regarding cloud software, it offers greater guarantees than the client company can shape internally. Do not forget that this is one of the competencies of your business, so the provider will be responsible for providing its customers with the most advanced security standards and the necessary updates.
In view of the above, there is no doubt that the choice of an ERP system in the cloud has many advantages that make local software a totally obsolete system.
Remember that NoBlue are specialists in integral cloud solutions for companies, if you want to know more about the benefits of cloud ERP software do not hesitate to contact us.