Skip to main content

The 4 key drivers for choosing a cloud ERP platform

ERPs do the same whether they're in the cloud or on-premise don’t they? The answer might not be what you expect. Thousands of companies are making the switch from on-premises to cloud. There are a huge number of reasons to make the move, from retiring legacy systems to creating more integrated modern app ecosystems. 

But for most companies making the switch to cloud, 4 key trends are driving the decision. We’ll be exploring these below, and how they might affect your ERP evaluation process as you consider migrating your system.

Click to read ERP product brochure Gated

Cloud ERP vs On-premise

In one sense, you're right; there is no real difference between the tasks that a typical ERP solution can perform, whether it’s on-prem or cloud based. With the right ERP software, your organization can do all the same things. It's merely a distinction in where the system is located and managed.

The difference between the two - especially as it relates to your potential ERP selection process - actually comes from looking a little deeper at the platforms themselves and their behind-the-scenes capabilities and architecture.

Selecting an ERP system: here or there?

So, if your ERP software is the same, how does your ERP platform be a cloud platform make any difference? In what ways does it materially affect your ERP selection criteria, and the experience you deliver to your people in using the system’s functionalities?

Holger Mueller of Constellation Research has written a paper on how Unit4 pushes the ERP Platform to the next level in which he explores precisely these questions.

In recent years, the use of cloud ERPs has exploded, thanks to the level of flexibility and scalability it affords when compared to the traditional on-premise model. And the four most prominent drivers behind this growth are quite exciting for organizations looking to prepare their ERP solutions for the future.

According to Mueller, these drivers are:

1. Improved People Experience

“People have a better user experience (UX) as consumers than as employees, and that difference is leading to an engagement gap between work and private life UX. Enterprises need to enable better people experiences by adopting the same platform that powers the consumer experience.”

Beyond performing the tasks, you require it to, the major source of value that your ERP can provide to your organization is the experience of work that it creates for your people - both through the quality of its user experience and in its capacity to automate the routine tasks that get in the way of valuable work.

Modern cloud-based ERP solutions have the ability to provide a vastly improved user experience thanks to modular design philosophies that allow ERP workflows to be accessed wherever and whenever your people need them. Beyond this, the flexible compute scaling offered by cloud solutions allows for both powerful AI-backed automations and for the low- and no-code functionality needed to make creating workflow automations possible by virtually everyone in the company - allowing incremental improvements to experience without disrupting day-to-day activities with lengthy waits for customization or integration.

2. Faster Innovation Cycles

For most, on-premise solutions are demanding in cost, time and resource - and for good reason. ERP software selection is often dictated by considerations of their total cost of ownership (TCO) and the burden a given solution might place on internal IT resources.

Needing teams in-house to manage and monitor your ERP continually and ensure it keeps ticking requires a lot of man hours that could be better used elsewhere. IT also makes updates a big undertaking - if your teams are constantly fighting a battle to keep the system running, they’ll be ill-disposed to upgrade it. This not only slows innovation and development, it presents a serious source of security vulnerabilities and failure points as your system ages.

Cloud ERP removes many of these barriers to innovation, meaning you no longer need on-site management or teams and will always be on the latest version. Letting you refocus that time, resource, and spend to boost innovation cycles thanks to the cloud’s improved speed, adaptability and scalability. 

3. Better Elasticity

With cloud ERP solutions, you only need to pay for what you use. Usage can be instantly scaled up and down as demand changes, meaning you won’t have any hard IT infrastructural barriers to your growth or strategic flexibility.

This is becoming increasingly important as demands from capabilities like AI and machine learning grow. These new technologies are resource-intensive, and once organizations embed them fully, they’ll often find they quickly overwhelm on-premises hardware architecture with their processing demands. 

With cloud platforms, managing fluctuations in demand and data come without the sizable levels of planning needed to do the same for on-premise. You’ll no longer have to worry about over-engineering data centers to account for peak time - or about the cost of that extra resource lying unused as a loss to the business.

4. Higher Resilience

Modern consumer demands are evolving, and they want organizations to be available 24x7. The problem is many older, on-premise ERPs are not built for this.

Regular updates and maintenance mean they struggle to achieve the "always on, never down" capabilities now required by most organizations for them to even conduct day-to-day operations. Your legacy systems, in this environment, can actually expose you to considerable commercial financial and reputational risk.

Cloud ERPs, by their very nature, are built to allow functional 100% uptime and access. Giving you full access to all systems all the time from anywhere at any time, and from any device. And they provide this constant operations resiliency at a lower cost than on-premise can.

They also have the added advantage of completely outsourcing the facilities and hardware management burdens inherent in maintaining your organization’s own data centers. Providing advantages not just in the realm of cost-saving but moving a large amount of CAPEX costs into OPEX costs and helping you to reach your overall sustainability goals.

What does this mean for your organization?

ERP solutions using cloud platforms are transforming organizations. Revolutionizing people experiences (both for staff and consumers), boosting engagement and innovation, and giving you more flexible, accessible, usable and available systems than ever before.

All while offering the same functionality you've come to expect from your ERP.

What's more, the right Cloud ERP systems come with these benefits as standard, you don't have to spend time and money developing them. Giving you immediate access to them from the moment you start using the software.

How can Unit4 help you?

As well as having over 40 years of experience creating ERP systems for people-centric organizations, Unit4 is also leading the way in creating truly next-generation cloud ERP systems. 

Unit4 ERPx is our new modular ERP, with a focus on the people experience across your organization. It covers financial processes, time and billing, HR processes, and analytics and operations, allowing organizations to scale rapidly as needed. 

This is achieved with our native cloud microservices platform, which provides an anywhere, anytime use for the organization. ERPx also enables your organization and partners to add-in additional process extensions or integration of other areas with low-code toolkits. Providing a quick answer to customizing a process without depending upon the IT department.

To learn more about what our next-gen cloud ERPx can do for your business visit our dedicated ERPx product page now or click here to book a demo.

Sign up to see more like this

Dylan Llewellyn - Industry Specialist at Unit4

Dylan Llewellyn

Dylan is an industry specialist at Unit4 providing in-depth sector articles for Higher Education, Not-for-Profit, Finance, Professional Services and Public Services. Dylan previously worked at Thomson Reuters, SMRS and Tetra Consulting as a senior editor.

More from Dylan Llewellyn