Software Comparison Series Comparing Cloud & On-Premise Solutions

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1 Software Comparison Series Comparing Cloud & On-Premise Solutions Transforming Companies How to Begin Transforming your business is no easy feat. Today s software solutions are constantly evolving and expanding their capabilities to accommodate the growing needs of businesses like yours. Whether you are looking to improve the functionality of your current solution or replace it with a more robust option, it is important to know where to start. Before beginning any software evaluation process, you must first document your challenges, key business objectives, and future goals. It is important to determine what you truly need from your ERP solution. Now that you have a clear understanding of what your business needs are, you can begin to compare your options. We have developed this series of comparisons to help you determine the solutions that meet your specific challenges. While most ERP solutions have the same core capabilities and functions, we highlight the differentiators and strengths of the industry s leading ERP solutions. If you have any questions at all during your review, we are always here to help. Guiding business transformations through thoughtful decisions, trusted relationships, and a focus on client success & elegant software solutions

2 Data & System Security Data and system security are important items to consider when comparing cloud and on-premise solutions. As technology and security continue to advance, there are strengths to hosting the solution on a local server as well as having the solution hosted by a cloud-provider. Many small and mid-sized businesses struggle to implement and maintain best practices when it comes to security, backups, and data protection without the help of a dedicated IT resource. Cloud providers do much of the heavy lifting for you with dedicated security and expertise often not affordable to most small to midsized businesses. Availability Redundancy Recovery Data Security Continuity Data is accessible from anywhere. Many cloud solutions even have free mobile apps available Most cloud providers are committed to minimum uptime of 99.5% Individual performance may vary based on internet connection and workstation reliability Most rely on geographically separated data centers to safeguard data and promote consistency Data is replicated and synchronized across multiple data centers to facilitate recovery in the event of failure Most offer disaster recovery (e.g., earthquake and fire protection) Maintain consistent heating, cooling, and backup power to prevent crashes or corruption Providers encrypt data accrding to the industry standards. They stay ahead of changes and ensure audit compliance and requirements Role-based user security & even field-level security is available Provides business continuity in the event of natural disaster Uptime is dependent on the individual s server infrastructure and set up Individual performance varies based on customer s IT resources, environment, and hardware Usually maintained through Uninterruptible Power Systems (UPS) provisioned by users Data redundancy can be a challenge when there is not a consistent central storage for data Users establish backup procedures and schedule regular backups individually Users are responsible for safeguarding data and putting company practices in place to protect the end user. Role-based user security & even field-level security is available Users must establish continuity plan for natural disaster

3 Demographics Since every business is unique, there is no cookie-cutter way to define which solutions are best for which companies. However, there are some indicators that your business may lean toward a cloud or on-premise solution. Here are some features and observations that may help you determine what makes sense for your company. Company Size 5 1,000 employees Greater than 1,000 employees: can use a two-tier ERP model, using NetSuite for subsidiaries and rolling up results to solutions like Oracle or SAP 5 1,000 employees System User Count Up to 4,000 employees Up to 200 employees on average Up to 1,500 employees for some enterprise level solutions Customer Growth Locations Top Verticles Great for growing companies focusing on business agility and with little desire to maintain a server environment Supports multi-location and multi-national legislature Ideal for businesses with many remote employees or global requirements Distribution/wholesale Software & technology Professional services Retail/eCommerce Light manufacturing Great for companies looking to maintain or improve current operations, who do not mind maintaining a server environment Supports a multi-company environment International or global legislation can be a challenge for most on-premise solutions, except for Sage Enterprise Management Remote access requires a terminal server Distribution/wholesale Manufacturing Food & Beverage Professional services Business Culture Data Users are social/mobile and rely on cloud Applications (Gmail, Dropbox, etc.) Highly collaborative environment Focus on data visibility as a key value driver Fast decision cycles Hierarchical and centralized environment Heavy compliance and regulatory requirements Highly sensitive data

4 Support Few companies have the resources to install, set up, maintain and support ERP systems on their own. When evaluating new business management solutions, it is important to consider how upgrades are handled, the health and direction of the solution & vendor as well as who will help support your system. Maintenance Plans Upgrade Management User Training Ongoing Support Vendor Focus Vendor Roadmap Included with your annual software subscription New versions are rolled out in the cloud automatically. Customizations are automatically rolled forward; no additional investment is needed. Ongoing user training recommended Free learning resources available Support provided by your implementation partner Focused on continuous growth, new releases, and expansions happening daily Developing new features for specific verticals Expanding existing feature sets to keep up with the growing needs of their customer base Additional costs associated with staying on-plan Some plans can be paid monthly with your subscription costs, or annually with perpetual licensed software. New versions are published regularly for customers to install May require additional work to upgrade customizations and connections to 3rd party applications Ongoing user training recommended. Learning resources included with customers on active maintenance & support plans. Support available through your implementation partner or through the vendor directly (if you are on an active maintenance & support plan). Often focused on maintaining the solution Product updates and expansions happen less frequently than with agile cloud solutions Looking to modernize functionality and improve system workflows Many are moving to subscription model pricing and expanding connectivity to 3rd party application networks

5 Pricing & Total Cost of Ownership One of the most important considerations when comparing cloud and on-premise solutions is the financial investment. However, it is never a simple comparison of software and implementation services. You must also contemplate the total cost of ownership (TCO) over time. It is important to consider IT costs, installation services, cost of upgrades (major & minor), cost of customization, testing, back-up, recovery services, and workstation/server maintenance. One of the biggest strengths of a cloud solution is the cost-effectiveness over time. We have outlined a few of these considerations below to assist your team in your software evaluation. Hardware Cost Implementation Cost Upgrade Cost Annual Fees Support Cost Tax Implications Long-Term Cost IT Resources User devices (laptops, computers, tablets or phones) Users work with technology provider to set up and configure the system and provide user training Upgrades are included with annual subscription fees & occur automatically Training and other staff processing changes may be required System use is billed annually per user and modules as a service Subscription support plans are typically available through the software vendor or on an as-needed basis through your implementation partner Typically not subject to sales tax. (Please refer to your specific state tax laws) Pricing generally stays the same Subscription price increases are a possibility, but most agreements can be structured to protect you from price spikes IT resources are not required to maintain a cloud solution, although you may need IT resources for other areas of the business. Servers, hardware, user workstations, networking, and backup equipment Users work with technology provider to install, set up and configure the system, and to provide user training. IT support required to ensure compatibility of servers & workstations Installation of upgrades is optional. Users typically rely on their business partner or technology provider to prepare the system, load the upgrade, and train users if needed, which incurs additional costs Maintenance and support plan fees are optional after the first year Vendor direct support plans are typically included with your annual maintenance & support costs Implementation partners are available to provide paid support on an as-needed basis Usually subject to sales tax Deductions (such as Section 179) and depreciation benefits may be available Software maintenance plans are optional but strongly recommended To receive updates and be eligible for system up-grades, you must be on an active maintenance plan Additional services may be required for version up-grades, especially if sys-tem customizations or 3rd party integrations are present IT resources are required (either in house or outsourced) to assist with back-ups, server maintenance, compliance, installs, etc solutions@blytheco.com Providing business software, consultation, implementation, education, & support for growing companies like yours. Laguna Hills, CA Atlanta, GA Tampa, FL Denver, CO Minneapolis, MN