In our private everyday life we use cloud-options have long been a matter of course and in more and more areas. Whether it's Drobox, Google Drive or Apple I-Cloud - content can be easily stored on web servers and accessed from anywhere.
The range on offer is large and is also growing for the commercial sector. Of course, there are now also ERP systems in the cloud, such as SAP Business One on Demand . Cloud offerings are still a marginal topic, especially in the ERP world.
It is worth taking a look at the advantages and disadvantages of constantly developing offers:
Pro:
Of course, a major advantage of cloud ERP is its geographical flexibility. The system can be used at any time and from anywhere and is continuously supplied with updates by the server. This saves costs for a new version and the cloud ERP system is always up to date.
Cloud ERP users also benefit from very clear management of all the company's data.
Another pro is the option to "rent" the system. This eliminates the risk associated with an ERP purchase.
Here are the main advantages once again:
- Outsourcing the IT department (incl. admin and hardware) reduces costs
- Worldwide availability
- Low license costs
- Secure data storage, as data is professionally backed up
Contra:
One disadvantage is that the range of cloud ERP providers is not yet as sophisticated as that of ERP software. This means that users are reliant on the applications that are currently available. However, this area is still developing and there will probably be an ever-increasing range of customised cloud ERP in the future. On the other hand, the cost advantage will continue to shrink as each customisation leaves a standard that can be used together.
Moreover, the costs are only really incurred in the initial period after installation. Depending on the installation, a purchase may be worthwhile after just one or two years of paying monthly rental fees. However, since ERP installations are usually set up for more than 6 - 8 years, this is a structural problem that is almost impossible to solve.
Another disadvantage - or probably the biggest criticism of all cloud opponents - is the external storage of data. The Security in the data centres cannot be completely guaranteed. In addition, company data can only be accessed via the Internet. This is also not a completely secure connection.
Here are the main disadvantages once again:
- Dependence on a secure Internet connection
- Browser capacities are often very busy. This can lead to frequent crashes
- Expensive with a long term
- None 100% Data security
- Few flexible customisation options for business processes
Conclusion
The ERP cloud options have a few advantages that should not be ignored - after all, it is very convenient for the respective companies if the IT department can be reduced to a minimum and everything can be outsourced. However, this also makes a company dependent on the service provider and Data security and data availability cannot be guaranteed one hundred per cent. You should therefore always find out about the security standards of the respective provider.
Last but not least, providers still have to come up with really attractive pricing models for the usually long term of ERP installations.
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