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Cloud computing has been one of the most transformative advancements in enterprise technology. Businesses no longer need to deploy enterprise resource planning (ERP) software on expensive servers. They can lower costs and hasten implementation projects by hosting ERP in the cloud. The cloud supports mobility, real-time visibility, and digital innovation, allowing manufacturers and distributors to improve efficiency and increase their competitive edge.
Many businesses are already making the switch to cloud technology; 73% of businesses have at least one application in the cloud. Yet, many companies believe the myths about cloud ERP, so they neglect to use this exceptional technology.
As cloud-hosted ERP continues to become the standard for ERP deployments, companies that stick to on-premises solutions risk falling behind. (Even with all the upside of moving to the cloud, many companies are still hesitant. Let’s look at some common misconceptions companies still hold when it comes to cloud ERP.)
One reason businesses choose not to host their ERP software in the cloud is that they don’t want to lose power over their technology, data, and processes. Fortunately, businesses don’t have to worry about relinquishing control to the cloud. In fact, companies can enjoy greater flexibility when they deploy their software off-site.
Leading cloud platforms, like Microsoft Azure, supports unlimited customizability. Microsoft Azure users can tailor their solution to their specific needs, maintain their familiar workflows, and integrate applications without extensive coding. Plus, hosting ERP in the cloud allows organizations to be at the forefront of technological innovations (i.e. AI and IoT), enabling businesses to capitalize on cutting-edge features to drive continuous improvement. Additionally, cloud solutions offer easy scalability. Instead of investing heavily in hardware and servers as you grow, you can simply change your cloud subscription to support new users and locations.
Further, businesses want to maintain control over their upgrade schedule–ERP vendors that offer software as a service (SaaS) cloud hosting often lock customers into their release cycle, but when you host software in the cloud through a third party, you can upgrade at your own pace. This is becoming more and more valuable as software vendors tend to implement more aggressive release timelines. Instead of upgrading multiple times a year, you can adopt a schedule that works for your business.
Businesses tend to gravitate to the cloud because of the lower, upfront costs. The major expense of hardware and servers used deter SMBs from ERP implementations, and cloud ERP doesn’t require hardware installations, making the implementation much less expensive. However, many companies that have already implemented on-premises ERP software neglect to switch to the cloud because of the perceived long-term costs. Most cloud providers require monthly subscription costs which increase as you add users. As a result, organizations fear that the total cost of ownership (TCO) is higher for the cloud than on-premises deployments.
Though cloud ERP may appear more expensive in the long-term, however, when estimating TCO and ROI, we recommend looking at outside installation costs and subscription plans. Hardware isn’t just difficult to implement; it can also be challenging and expensive to upgrade and maintain. The effort, costs, and risks associated with hardware upkeep are often overwhelming. Plus, adding new users, locations and features for your on-premises applications can be complex and expensive.
The cloud opens the door to exciting features and capabilities that can add value to your enterprise. Cloud ERP entails fewer risks and challenges than on-site software, making it a more affordable option for most organizations.
There are two prevalent myths about cloud security: some fear their sensitive information and valuable IT investments are in danger in the cloud, others view cloud software as a safe haven for their data. The truth lies somewhere in the middle.
Concerns about cloud security have been around since cloud computing became a mainstay in enterprise technology in recent years. Businesses were wary of trusting cloud providers with their data. But for most organizations, information is actually safer in the cloud. Providers such as Microsoft Azure enforce high-security standards and offer 24/7 support to protect applications. Azure includes geo-redundant disaster recovery and complies with a large range of regulations and standards. Additionally, it offers a service level agreement (SLA) of 99.95%, guaranteeing minimal downtime. The average manufacturer or distributor can’t uphold this level of security on their own.
That being said, this doesn’t mean your data’s safety is completely in the hands of your provider. Security responsibilities are shared between your cloud provider and your organization. While the cloud considerably lessens the work required to protect your solution, there are still measures to take that will protect your business’s critical data. We recommend researching to ensure your cloud platform meets all your security requirements. As you research cloud-hosting options, ask vendors about their security measures, backup frequency, encryption methods, and other critical factors.
Further, we recommend considering investing in a backup and disaster recovery solution. Cloud providers don’t specialize in data restoration. A disaster recovery solution backs up files more frequently and stores copies of data both locally and online to help businesses resume operations in no time. Think of backup and disaster recovery systems as insurance for your vital information and software.
Cloud computing offers a range of advantages, including simplified implementations and management. Plus, Azure is an industry leader in forward-thinking, reliable cloud hosting. Using Microsoft Azure delivers scalable, reliable software, so you can focus on the core of your business.
Datix has over 20 years of experience working with manufacturers and distributors, and we have the expertise to meet your ERP needs. We will work with you to implement, manage, and improve your cloud ERP. Our consultants are dedicated to optimizing your software investments, ensuring you unlock their full potential. When you are ready to make the move away from outdated on-premises solutions and accelerate your digital transformation with cloud-based solutions, contact Datix.