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The Difference Between Cloud and Hosted ERP

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Written by Laura Schomaker

August 27, 2020

If you have been considering an ERP solution for your business, you may have been looking into both cloud-based and hosted versions. The difference between cloud and hosted ERP can be nuanced and understanding which works best for your business can be complex. To begin, let’s try to define each then transition into the benefits of working with either approach.  

Cloud ERP and Hosted ERP – What are They Exactly? 

At their heart, both cloud and hosted ERP offer access to data and programs that are hosted on a server. Where they differ is in where the server doing the hosting exists. In a hosted solution, a third party such as Intelligent Technologies, maintains the hardware needed for the solution on their premises and hosts the solution. The users access the solution via a Virtual Private Network and remote desktop services. This requires installation of the software application on desktops at the client location.  

In a cloud approach, on the other hand, the end user accesses the solution using a browser, such as Internet Explorer (IE), Firefox, Chrome, Safari, and so on.  The end user needs nothing beyond their work computer and an internet connection to access the ERP solution.  

Which is the best fit for your company?  

Here are some points to consider when choosing between cloud and hosted ERPs  

  • Customization: A web-based ERP in the cloud will typically take a more generalized approach. As such, it may not feature as many customizable features or industry-specific features. A hosted approach on the other hand may allow for some detailed customization that answers directly to company needs. Additionally, a hosted ERP may offer support to a wider range of division across your company.  
  • On-site Skillsets: A cloud-based solution removes all need for IT staff on site that can manage hardware and software used in the solution. Smaller companies with minimal IT support can, therefore, benefit from this approach.  
  • Cost: A bespoke, hosted ERP solution is going to cost more, due to the detailed approach. There is also the added overhead cost of on-premise IT staff to consider.  
  • Scale of the Company: Small to medium-sized businesses are generally well-served by the simpler structure of a cloud-based approached. If companies scale up, however, they may find web-based solutions limiting, at which point they could consider transitioning to a hosted approach.  
  • Collaboration: As a web-based solution, a cloud ERP is going to offer more opportunities for collaboration. These solutions are based in the principle that all users at a company can benefit from access to the whole ERP system, streamlining communication and teamwork.    

 

 

Choosing the right ERP approach is essential to the success of a company. Both cloud and hosted solutions offer a wealth of advantages but it all depends on usual business factors, including cost, scalability, and the structure of a business. Now that you know the difference between cloud and hosted ERP, if you are interested in exploring both cloud and hosted ERP options, start by visiting our website 

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