The key differences between on-premise, hosted and cloud ERP

Posted by WinMan on 20 Aug

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If you are looking to improve the workflow of your manufacturing business, you will most likely have come across the term ERP (enterprise resource planning) platforms. You may be wondering whether on-premise, hosted or, cloud ERP platforms are right for your business. In this guide we explain the key differences between these platforms, to help you determine which is right for your manufacturing business.

What is an on-premise ERP platform?

An on-premise ERP platform is installed and managed on the company's own IT infrastructure. On-premise ERP manufacturing software is considered as a capital expenditure, as it is often one up-front payment that is priced based on the size and requirements of a company.

It is a traditional platform, which allows users greater control over the infrastructure resources and configurations. This allows a manufacturing business to configure and scale the on-premise platform to business requirements.

A potential drawback of on-premise ERP is that as the company has more control over the platform - as it will incur costs because it is the company's responsibility to manage the security of its data and maintenance of the infrastructure. If businesses do not maintain networks or safeguard their data efficiently, they could experience downtime or become the target of cybercriminals.

What is Cloud ERP? 

Cloud ERP is not hosted on a company's servers but a solution that is accessed by the company via a web browser. Cloud ERP platforms are usually a subscription service or monthly expense, which some businesses can find more cost-effective than a large upfront fee. Having an operational cost instead can help companies spread expenditure more effectively.

Some manufacturers choose to use cloud ERP platforms as they do not require the purchase of any additional hardware or technology and the data and platform security is the responsibility of the vendor, not the company. For this reason, due diligence is required to ensure your Cloud ERP provider has adequate security measures in place.

One limitation of cloud ERP platforms is that they tend to be less configurable, meaning a company with unique manufacturing processes may find it hard to implement a cloud ERP solution.

What is hosted ERP?

Hosted ERP platforms are hosted off-site and usually in a private server owned by the company or a third party. The platform is installed on a remote server but accessible to a business via a VPN or remote desktop.

Like cloud ERP platforms, hosted ERP services can be available on a subscription basis, meaning a company does not have to pay an upfront fee for the infrastructure. Costs can vary as it is dependent on the type of hosted service and software, on the size of the business and their requirements. Hosted ERP platforms can usually be scaled as a manufacturing business grows, for example, if they expand their storage facilities, making it a very flexible option. Hosted solutions enable companies to have more control over their platform compared to cloud ERP.

Contact WinMan

On-premise, hosted and cloud ERP all have advantages and disadvantages, to learn more about the different solutions, do not hesitate to contact WinMan today. A member of our expert team would be happy to discuss your manufacturing processes with you and help you find the right ERP solutions for your needs.

>> See WinMan's ERP software functions here

Topics: ERP Software, Business Management Software, Cloud ERP

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