Confused about the cloud? Stumped over SaaS? Perplexed by platforms? Wonder no more! Panorama has posted a new white paper, Frequently Asked Questions About Cloud ERP to make sure that you have the information you need before deciding which ERP deployment option is right for your organization. The free report covers security issues, benefits and drawbacks of cloud ERP, primary causes of ERP cloud failure and comparisons between cloud / SaaS solutions and on-premise solutions based on research in our 2011 ERP Report and 2010 ERP Report. To whet your appetite, we’ve included three of the ten FAQs below:
1. What’s the difference between cloud and software-as-a-service (SaaS)?
SaaS offerings are typically smaller, niche solutions that are best for organizations with limited complexity, size and global presence. ERP vendors host SaaS applications on their own infrastructures instead of locating the systems on-premise at the purchasing organization. To use a SaaS application, one typically logs into a vendor-controlled website.
Cloud ERP, on the other hand, really means traditional ERP solutions hosted off-site. Its flexibility and scalability are big selling points, as is the capability to access real-time data from anywhere without using complicated and costly remote-access software.
2. What is a “hybrid” cloud option?
A hybrid option is basically another way of saying cloud ERP. As touched on above, it’s when organizations purchase a traditional Tier I (SAP, Oracle, Microsoft Dynamics) or Tier II (Infor, Epicor, Lawson, etc.) ERP system and have it hosted by a third-party vendor. This can be a “best of both worlds” scenario for some companies as it provides the flexibility of on-premise ERP solutions with the cost and outsourcing benefits of the cloud.
3. Is it really faster and cheaper to deploy cloud-based solutions?
There’s no question that it’s faster (and cheaper) to implement a cloud-based solution than an on-premise one . . . at least in the short-term. What vendors might not tell you, however, is that an ERP strategy still has to include comprehensive business process mapping, data cleansing, organizational change management, end-user training and a number of other activities to ensure your organization achieves the highest possible ROI.
The cost structure of cloud ERP also is quite different than on-premise ERP. Rather than paying one lump sum up-front, organizations must pay for yearly subscriptions to their cloud provider. Companies are of two minds about this: on one hand, it’s a great way to amortize a large upfront expense over several periods. On the other, if cash is suddenly tight it may be impossible to pay for the subscription going forward (whereas with an on-premise solution, the costs would have already been absorbed). Think of the difference between buying and leasing a car – while scheduled payments can be easier to stomach than a lump sum, buyers who go this route typically end up paying more in the long run.
Hungry for more? To keep reading, download Frequently Asked Questions About Cloud ERP in our Resource Center.