Is Cloud-based or On-premise ERP Best for Your Business?

11/2/17 11:06 AM

Small and midsized businesses benefit from the extensive features and industry-specific functionality found in SAP Business One (SAP B1). Whether you deploy the software on-premise or in the cloud, it improves every facet of your operations.

But how do you choose between on-premise or cloud-based SAP B1? Consider these tips.

Cloud-based ERP Improves Your Agility

Cloud-based ERP enhances business agility, and any organization can implement and utilize a modern ERP in a matter of weeks when SAP Business One is hosted in the cloud. Why? Because you need the bare minimum of IT expertise and infrastructure to run ERP across the organization; many small businesses run cloud-based ERP with nothing more than internet connections managed by a non-technical resource. Mobile capabilities, which allow users to be productive wherever and whenever they are, offer further agility as well as improve employee morale and increase effectiveness.

And when you decide you could benefit from new ERP features or industry-specific extras, request to add them to your deployment, with no need for downtime – your system stays up and running as the new features/functions come online.

Cloud-based ERP also protects your business from excessive exposure to high costs that can hurt cash flow. Rather than purchasing expensive, front-loaded licenses, hiring in-house technical expertise, and allocating physical space for an on-premise deployment, a cloud-hosted ERP requires virtually no upfront cost, and your long-term costs become predictable, as you know how much the monthly fee is and what that it includes. This removes the stress of unforeseen expenses related to an on-premise deployment, such as fluctuating fees for maintenance and upgrades.

on premise or cloud based ERP

In the past, cloud-based servers were more likely to be hacked than desktop systems, but newer, better cloud services improve security with firewalls and security experts. Additionally, SAP B1’s cloud-based ERP relies on a redundant system of front-end servers and backups to minimize your downtime should a server be compromised.

On-premise ERP Leverages In-house Expertise

If your business enjoys the dual-pronged features of a robust IT infrastructure and strong IT support staff, you may want to consider an on-premise ERP deployment. The price you’ve paid for technical expertise and supporting elements represent sunk costs, so not utilizing them would be a waste of money and resources. An additional cost benefit of on-premise deployment comes from the lower long-term licensing costs. You pay more up front, but, over time, a well-managed in-house deployment costs less than a cloud-based one.

And some businesses like knowing where their infrastructure, systems, and data reside, and prefer for it to reside in their facility. Having everything in one place makes it easier to secure as well as replace equipment and troubleshoot when necessary. Additional security comes from the ability to isolate specific data and processes so they’re never exposed to the public internet. Even the best hacker can’t hack a disconnected system.


Selecting a modern ERP deployment model is analogous to deciding whether you should own or rent your next car. Do you want the ability to change things quickly and protect your cash flow, or do you prefer to manage everything yourself and save over the long term? Whichever you choose, your SAP Business One deployment will deliver the comprehensive set of ERP features you need to improve profits and gain a competitive advantage. Please contact us for more information.


Join Our Newsletter

Join over 2,000 other marketing pros in subscribing to the award-winning our Blog.

Leave a comment