Wasn’t it Hamlet who once said, “To cloud, or not to cloud…that is the question”. No? Maybe that’s not exactly right, but one thing is for sure: deciding whether to install a Microsoft Dynamics ERP solution locally on your own server or host it in the cloud can have a major impact on your organization’s long term operations. And just like any major business decision, each option has pros and cons that must be considered prior to purchase. To help with this decision, we’ve put together a handy guide to give you information you need before you buy.
Up in the Air: What to Consider with the Cloud
1) Initial Cost
Cloud-based solutions eliminate one of the biggest challenges of tradition on-premise ERP solutions – initial cost.
When estimating the cost of a cloud-based Dynamics ERP solution versus on-premise, factor in both the software license costs and the cost for your IT department to support a local installation in terms of both time and money.
The cost structures of Dynamics ERP products such as AX, SL, NAV, and GP will vary depending on the size of your organization and how many users will be working within the software.
When estimating service-related costs, measure out the duration of the project versus the pay of your IT team members. Do some research to identify the IT team’s responsibilities related to a cloud deployment versus the on-premise approach they likely understand better. Understand how much upkeep your organization typically needs, and where your best and brightest should be focusing their efforts. Even with a superb IT team, the cost of a local install may still be too high for the organization to bear in the long run.
2) Recurring Costs
A significant factor to consider in cloud-based solutions is recurring costs. While cloud-based installs incur fees on a monthly basis, the benefit is that those fees are predictable. You know how much your company will pay month-to-month and you can budget for that expense. As an added advantage, the monthly fee typically includes updates, keeping you current with security patches, new features and more that would otherwise take up time and productivity for your in-house departments to implement.
By contrast, keeping a local install current can be costly, requiring a company to set aside funds for major releases and upgrades. It would also be recommended that you find a savvy Microsoft Partner – one with reasonable rates and the intellectual prowess to stay up-to-date on the product and be ready to work with your employees on handling each new upgrade.
Closely related to costs are the logistical issues associated with running a local install – and the freedom from those issues that a cloud solution provides. This is especially true for smaller companies that may not already have the necessary hardware or employee infrastructure in place to get it up and running. Not only can the cost easily run into the six figures, but the time it takes to acquire and set up the hardware must also be taken into consideration, especially if rapid deployment is a priority.
So now that we’ve looked into three key points to consider regarding a cloud install of Dynamics ERP, let’s look at three points to keep in mind if you’re thinking about opting for a local setup.
Down Home: What to Consider When Looking to Install Locally
More and more security breaches for even the highest-profile companies are making the news from Target to JP Morgan; no organization is safe from hackers and malware on the web. There’s a common saying that applies here: security through obscurity. The higher a company’s profile, the more attractive a target it makes.
For companies that want total control over their own security, a local install would be the more attractive option. This is especially true among companies whose security teams are... click here to read the rest of this article