It’s no secret that businesses sometimes have a hard time letting go of their old software solutions in favor of newer ones. There are good reasons behind it, too – upgrades can be costly, they can take a lot of time to plan and implement, and they might require businesses to develop new work procedures and teach them to the employees. So it should come as no surprise that businesses are slow to deploy new operating systems, for example, or to jump at an opportunity to move away from enterprise productivity legacy software.
But there comes a point when resisting to change the business’ software starts hurting the business. Just like deciding against patching an operating system was one of the reasons why the WannaCry ransomware infected so many systems, so can deciding to stay with legacy, on-premise enterprise resource planning software slow the business’ growth, at the very least.
What’s Wrong With On-Premise ERP?
On-premise enterprise resource planning software has long been the only option for resource planning solutions. A business would acquire the software and the hardware needed to run it, and the software would then be implemented and further customized by an in-house IT team. All of this would come at a significant upfront cost.
The upfront costs are not the least of the problems that come with on-premise ERP systems. Even though they offer much flexibility and they can be finely customized to meet every need of the business using them, the customization process could take a lot of time, delaying implementation significantly. And the implementation of on-premise ERP system is already a lengthy process.
Upgrading on-premise system could also be a costly and lengthy process. In some cases, the legacy software could not be upgraded at all, because the companies that developed the system either no longer exist, or no longer offer support for the software. And even if businesses wanted to upgrade their ten-year old legacy systems and give them new, up-to-date features, they would have to upgrade the hardware as well, increasing the total cost of the upgrade.
Cloud ERP – The Solutions It Offers
Migrating from on-premise enterprise systems to systems that are hosted or run on the cloud is the current trend of enterprise applications modernization. More than nine out of ten organizations are currently using cloud services for at least some of their computing and storage needs, with an increasing number of organizations moving away from on-premise, private cloud, towards a hybrid model.
Cloud ERP systems, such as the Acumatica Cloud ERP by Blytheco, address most of the problems that come with using on-premise ERP systems. They don’t require a large upfront investment, and business’ don’t need to buy hardware for the system. The IT team that used to maintain and operate the legacy system can also be allocated to different projects where they can contribute more. Cloud ERP systems are also much quicker to implement, and the regular updating and patching from the vendors boosts security and stability. They offer increased mobility, being able to be accessed using mobile devices, and they are much more agile in terms of quick scalability.
There is a tradeoff for all the benefits of cloud ERP systems – they don’t offer the same level of customization as on-premise ERP systems. Some vendors might be willing to work with their clients to implement the changes they need, but it usually comes down to configuring the existing system to the clients’ needs instead of building custom solutions.
Making the Switch
The first step towards moving to a cloud ERP solution is determining the type of solution that will work best for your company. Cloud ERP software is built for different-sized companies, different industries, and niches, with different processes, so finding a system that delivers everything a business needs should be approached carefully.
Switching from on-premise to cloud ERP is a process that doesn’t have any hard rules. Every migration should be looked at separately in order to develop the appropriate course of action. Some businesses move away from on-premise ERP one step at a time – they pilot the implementation with one of their subsidiaries, and then gradually move their ERP modules to a cloud-based solution. Businesses often spend some time using a hybrid, two-tier system that involves using on-premise and cloud ERPs simultaneously, combining their features. For some businesses, especially the niche ones, the two-tier system can be perfect because it gives them the benefits of the cloud along with custom-built on-premise modules.
There’s plenty of work that needs to be done when migrating to a cloud ERP. All of the processes need to be mapped so that they can be implemented in the new system. Data needs to be transferred. Third-party software solutions need to be integrated. Employees and management need to be educated and trained to use the new system. But if the rate of adoption of cloud ERP tells us anything, it’s that taking the plunge with cloud ERP could be worth the effort.