An important consideration when choosing a new management system is the type of installation. You have the option of installing the ERP locally (On Premise) or remotely (on an IAAS server). Additionally, a native cloud firm management system may be preferred.
A single satisfactory answer, which fits the needs of each company, does not exist.
For this reason we have briefly summarized the different installation possibilities, seeing their strengths and weaknesses, in order to give a complete and at the same time synthetic picture that can help guide the choice.
On Premise installation mode with ERP
An on-premise installation refers to installing an ERP system directly on the company’s own servers or computer systems. The ERP system is then accessible only by employees within the organization’s network.
Full control over the ERP system and data.
No dependence on internet connectivity.
Customization of the system to meet specific business requirements.
Advantages
With the On Premise installation, the company’s accounting data are physically located within the company perimeter, ensuring better control over them;
Ensures better visibility of your IT infrastructure;
The performance of the ERP software is not influenced by the stability and speed of the company Internet line, avoiding possible blocks due to external circumstances (extraordinary works on the network, unpredictable atmospheric events, provider errors).
High upfront cost for hardware and software.
Complex setup and maintenance, requiring a dedicated IT team.
Responsibility for protecting and managing data.
Need for regular software updates and security upgrades
Disadvantages
The installation of the company management system locally carries a greater risk of operational stops caused by possible hardware or environmental problems;
It requires frequent checks on the state of the infrastructure both at the hardware level , at the software level and at the security level;
The performance of ERP software is affected by the natural obsolescence of the hardware over the years.
ERP installation in IAAS and Public Cloud environment
Cloud-based installations refer to hosting the ERP system on a remote server, accessible from anywhere with an internet connection.
No need for expensive hardware or software.
Reduced IT maintenance costs.
Access to the system from anywhere, at any time.
Automatic software updates and security upgrades.
Advantages
Guarantee of service continuity thanks to the definition of the most appropriate SLAs (Service Level Agreements), which are always guaranteed.
Better scalability , with more flexible IT infrastructures that better adapt to business needs, allowing resources to be added or removed in a fluid way;
Greater IT security guarantees, with a lower risk of IT attacks on the infrastructure, guaranteed by advanced cyber security services;
Frees internal staff from the need to monitor the state of the infrastructure at the hardware level, delegating it externally.
Dependence on internet connectivity.
Limited customization options.
Responsibility for protecting data is with the service provider.
Monthly subscription fee for the service.
Disadvantages
The installation and maintenance costs of the installation service in an IaaS or Public Cloud (PaaS) environment may be higher over time ;
The company’s accounting data is physically hosted outside the company, in the Data Centers owned by the company with which you have signed the contract, or by cloud providers such as Amazon, Google or Microsoft
The performance of the ERP software is affected by the stability and speed of the Internet line.
As in the local installation, the need remains for constant checks on the state of the infrastructure at the software level and partly also at the security level.
Which Option is Best for Your Corporation?
The answer to this question will vary depending on the size, complexity, and specific needs of your organization.
For small to medium-sized businesses, a cloud-based ERP like Dynamics 365 Business Central, Dynamics 365 Finance, installation may be the most cost-effective and convenient solution. With automatic updates, limited IT maintenance, and no upfront costs, it’s a popular choice for many organizations.
However, for larger organizations with complex requirements, an on-premise installation may be the better choice. With full control over the system and data, customization options, and the ability to operate without an internet connection, it’s a solution that offers more flexibility and security.
Ultimately, the choice between an on-premise or cloud-based ERP installation will come down to the specific needs of your organization. It’s essential to carefully consider all the pros and cons and make an informed decision that will support the growth and success of your corporation.
Conclusion:
choosing the right type of installation for your corporate ERP system is an important decision that requires careful consideration. Whether you opt for an on-premise or cloud-based installation, the most important thing is to choose a solution that meets your organization’s specific needs and supports its growth and success.
