What is an ERP?
Enterprise Resource Planning software is a single unified platform that pulls data from different departments, standardizes it into a structured format, and depicts it in charts and reports using robust analytics and reporting tools. It offers various tools that improve real-time capabilities, speed, and accuracy and helps the business become agile in today’s highly competitive business landscape.
ERP software builds a centralized database that helps decision-makers get insight into various business operations, forecast sales, revenues & expenditures, and make informed decisions. It automates various business operations such as procurement, production, inventory management, supply chain, customer support, budgeting, and financial records generation, among others.
What is ERP Deployment?
ERP Deployment is the process of installing an ERP system, configuring and customizing it for everyday use, and migrating business data over the new system. It is a crucial activity before the company starts benefiting from the capabilities of the ERP.
The ERP deployment process goes through various phases:
- Planning & Consultation: This is the initial process of the ERP deployment which includes getting the “go-ahead” from the management for ERP implementation, researching the different ERP systems available in the market, setting up a Project Team, and keeping a budget aside. The company may also consult with external consultancy to lay the groundwork for ERP deployment.
- ERP Selection: This phase involves comparing different ERP systems available in the market in terms of their feature set, pricing, ease of usage, and specific business requirements. Ultimately, the company selects the best ERP.
- System Design & Data Mapping: In this phase, the company configures the new ERP to meet its business requirements and ease of usage. It involves making different changes to the system design, menus, and user roles.
- Testing: ERP is a large and complex software that impacts various business functions. Testing is a crucial activity to prevent errors, business disruptions, data integrity issues, and loss of productivity.
- Deployment: After the new ERP goes through the testing phase, it is deployed within the organization in a phased manner. The ERP replaces the traditional legacy systems, and any data stored on the legacy systems is moved to the new ERP.
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Types of ERP Deployment
1. On-premise ERP
On-premise ERP is installed on in-house servers within the company’s own IT infrastructure. As the ERP is deployed on servers physically located within the organization’s premises, the company has complete control over its data. Moreover, the company is responsible for deploying, maintaining, and upgrading the ERP system.
Benefits of On-premise ERP
- Highly customizable
- The company retains complete ownership over its IT infrastructure, servers, and ERP implementation
- On-premise ERP deployment allows companies to take stringent data security measures to maintain the confidentiality of important trade deals and other business data.
Who Uses On-premise ERP?
On-premise ERP is best suited for large enterprises, such as manufacturing companies with larger budgets, and companies that often require a higher ability to customize.
2. Cloud ERP
Cloud ERP is deployed on the vendor’s cloud platform and doesn’t require a standalone installation. It minimizes the risk of data loss as the data is completely stored on the vendor’s servers with adequate data backup facilities.
Benefits of Cloud ERP
- Cloud ERP is pre-deployed by the Vendor.
- There are no maintenance or upgrade costs as the Cloud ERP is completely managed by the vendor.
- Cloud ERP is extremely scalable to adjust to the growing demands of the company
- It is flexible and budget-friendly. There are no upfront costs.
- Data on the Cloud ERP is automatically backed up by the vendor, thus eliminating the hassle of manual backups and offering excellent disaster recovery.
- It can be accessed from any device (computer, Macbook, tablet, or mobile), any location (workspace, residence of travel), and anytime.
- Since all the data is stored on the vendor’s server, it doesn’t occupy local storage.
Who Uses Cloud ERP?
Cloud ERP is best suited for companies that need to leverage the power of modern technology and provide employees the ability to access data from any system or location.
3.Hybrid ERP
Hybrid ERP combines the features of both On-premise and Cloud ERP solutions to provide the best of both worlds. It allows businesses using the On-premise ERPs to integrate the cloud functionalities and take benefit of various collaboration features.
Benefits of Hybrid ERP
- Hybrid ERP is scalable, much like Cloud ERP
- Helps the company remain competitive by taking advantage of modern cloud computing technology
- The deployment cost is lower compared to On-premise ERP
- Facilitates the benefits of cloud collaboration among employees and teams
Who Uses Hybrid ERP?
Hybrid ERP is extremely beneficial for retail, manufacturing, and Government companies due to the considerable benefits it offers.
How to Select the Optimum ERP Deployment for Your Business?
There are different ERP deployment methods, each with its own benefits and drawbacks. Which one should you choose?
There is no one-size-fits-all answer. You can choose a deployment method that meets your business requirements and budget.
Best Fit For Your Business
Choose an ERP deployment that best suits the scope and scale of your business, and doesn’t cause disruptions to regular business operations. Disruptions in business operations can lead to resistance to change among employees and impact the organization’s productivity. For example, modern companies can leverage cloud technology in the Cloud ERP to facilitate real-time collaboration and data sharing, irrespective of the employee’s location and device. Employees can record sales performance and updates in real-time straight from their mobile.
Deployment Cost & Budget
There are several costs involved with the ERP implementation. For example, software license costs, support costs, training costs, upgradation costs, and hardware costs. Moreover, your company may also incur additional costs for appointing an external consultancy to provide support and oversee the operations. For example, Cloud ERPs are cost-effective. They come with fixed monthly or annual subscription charges. In contrast, On-premise ERPs require a significant upfront cost.
Deployment Time
ERP deployment can be a time-consuming process depending on the nature of the ERP. For example, deploying an On-premise ERP can take several months, whereas deploying a Cloud ERP can be comparatively faster and easier.
Deployment-related Challenges
Deploying On-premise ERP can be a challenging process. The company will need to work with the ERP vendor, and external consultancy team for successfully deploying the software. In contrast, Cloud ERP is easy to deploy and integrate with the data and traditional systems.
Robust Customizability
It is a common practice among companies to customize the ERP to increase its efficiency and productivity. It can be one of the factors that organizations can consider while selecting the deployment method. For example, On-premise ERP beats Cloud ERP with its extensive level of customizability.
Summing Up
ERP empowers businesses with various benefits such as agility, accessibility, scalability, and state-of-the-art technology. However, choosing the right ERP deployment is essential to benefit from boosted efficiency.
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Author’s Bio:
Sneha Rakte is a specialist in communication who excels at recognizing client requirements. She currently works with Sage Software Solutions, an industry leader in supplying small and medium-sized enterprises in India with high-quality ERP software and CRM solutions.
