ERP Software

Hosted Versus On-Site ERP Software Systems

Selecting a hosted ERP, or Enterprise Resource Planning solution, or an on-site ERP software system is a decision that all companies who plan to implement an Enterprise Resource Planning solution will have to make.  Both types of ERP software systems have advantages and disadvantages.  The type of ERP software system a company selects will depend on several factors like; the size of the company, the company’s budget, and the functionality the company needs.

With hosted ERP solutions companies don’t have to invest tons of money in an IT infrastructure.  Hosted Enterprise Resource Planning solutions are typically quicker to implement than on-site ERP software systems.  Hosted Enterprise Resource Planning solutions are also telecommuter-friendly.  Companies with several sites or locations will benefit from a hosted Enterprise Resource Planning solution if they don’t want to support remote access users or telecommuters.  A hosted Enterprise Resource Planning solution is hassle free and enables companies to simply pay a monthly fee, which takes care of and includes back-ups, updates, and support issues.  Along with these benefits there are some disadvantages to a hosted Enterprise Resource Planning solution.  One disadvantage that often turns many companies away is the inability to customize this type of solution.  Hosted ERP solutions can be configured however.

On-site ERP software systems require companies to invest in an IT infrastructure.  This investment can be rather large depending on the Enterprise Resource Planning solution.  For this reason alone, many companies opt for a hosted ERP solution.  However, there are many advantages to an on-site ERP software system.  For one, on-site ERP software systems can be customized.  And, on-site ERP software systems have a proven track record as they have been around much longer than hosted Enterprise Resource Planning solutions.  Companies planning to implement an on-site ERP software system should plan on a ten to fourteen month implementation, should have IT folks to maintain the ERP software system, and should plan to make a long term commitment in order to realize a return on investment.

Over the past few years small and medium sized businesses have primarily benefited from hosted Enterprise Resource Planning solutions.  However, hosted ERP vendors are making their way into the big business market.  It will be interesting to see the percentage of big businesses in the future that adapt a hosted Enterprise Resource Planning solution.

Written by :

kristine H