Microsoft’s latest statistics show that more than 75% of prospective ERP software purchasers are looking for cloud solutions. The last five years have shown significant growth in the numbers of companies willing to consider cloud ERP systems, to the point now where some software vendors only offer cloud options. A number like 75% definitely shows the tide has turned and companies need to consider why that is happening.
In fact, things have changed so much that the following statement makes sense, despite how controversial it may seem to some: The only legitimate reason for organizations not to consider cloud solutions is the lack of an internet connection. Now the world is a bit more complicated so that statement is not always true but it is the way things are heading.
Virtually all of the other reasons quoted over the past 10 years no longer or rarely apply. Let’s take a look at some of the changes.
1. Fast Internet is available to nearly everyone now
Even five years ago, internet service could be spotty and unreliable. Speed was an issue. Internet service connected to Wi-Fi now offers 99% or better uptime. This one factor enables amazing cloud and mobile solutions.
2. The rise of ransomware and viruses is a game-changer
Years ago you would hear the comment “our data is more secure on our server.” With the new cloud offerings from major suppliers like Microsoft, cloud security is magnitudes better than what is available from local IT providers. Who would you rather have look after your security, ensure you have the latest firewall hardware, and ensure your server patches are up-to-date? Microsoft, or the part-time IT guy or small organization supporting your system?
3. Companies now realize they are not in the IT business
Traditionally, companies have invested six figures or more in new computer hardware and systems. Adding the necessary technical resources, internal or external, to support these systems was incredibly expensive and potentially disruptive when problems inevitably arose. Switching to the cloud provides 99.9% uptime from suppliers like Microsoft. Keep your internet and Wi-Fi running and your users will be productive. Spend your capital budget on your key business processes and scale your systems up or down to suit your specific needs.
4. Internal IT is more expensive than cloud options
Comparing in-house costs to cloud options is like comparing apples and oranges. Especially if you just look at the most immediate costs, the monthly payments for the software. By the time you factor in the cost of the equipment, the IT staff necessary to maintain the systems, and the higher ongoing costs of upgrading software systems, a true multi-tenant (more on that later) cloud option is cheaper than in-house alternatives.
5. True multi-tenant cloud options mean free software upgrades
Depending on the level of customization of an in-house system, upgrades can cost 25% to 75% of the original cost to implement the system. And you need to spend that money every three to five years. A multi-tenant option, such as Microsoft Business Central, means your cloud system is automatically upgraded by Microsoft twice per year, for FREE! You might need to spend a bit of money occasionally on training for new features but otherwise your upgrade is free, regardless of whether you customized the system or not.
6. Multi-tenant systems allow for rapid upgrades
Systems like Microsoft Business Central prevent resellers or customers from modifying the core system, allowing Microsoft to optimize the upgrade process. When Microsoft updated its online Business Central customers in April, 2018, each database took an average of 30 seconds! Compare that time to the average upgrade process, which takes two to four months, or longer.
7. Well-designed multi-tenant systems allow for extension customization, if necessary, without affecting the upgrade process or cost
The isolation of the core business logic in systems such as Business Central and its superior technical design allow enhancements to be added through apps from Microsoft’s AppSource and customer-specific customizations without affecting the upgrade process. Microsoft simply unapplies any apps or customizations, upgrades the database in a matter of seconds or minutes, and then re-applies the newest version of the apps and the customer modifications.
The move to cloud-based solutions is happening so rapidly and extensively some partners are actually refusing to work with in-house customers. Regardless of which way you choose to go, cloud solutions are far more advanced than they were even three years ago and must be considered.
Did you catch our last blog on Business Central, the most popular mid-market ERP and accounting system in the world? Learn more about its easy implementation, unique customizations, and FREE upgrades.