The bottom line: cloud ERP makes financial sense

By Paul Kruger, Director of Regional SAP Sales and Marketing on

In today’s digital economy, IT leaders are constantly grappling with the need to match their infrastructure capacity with capital expenditures. Either their capacity falls short and hinders their ability to take advantage of new opportunities or they’ve tied their capital up in underutilised assets.

Being able to scale up quickly allows an organisation to achieve growth and seize new opportunities but IT procurement processes can be prohibitively lengthy and expensive. IT agility can be achieved by moving certain systems and workloads to the cloud, which allows organisations to quickly procure more capacity. Offered on a pay per use basis, the cloud allows organisations to get the capacity they need without having to make major capital outlays.

While the cloud offers many ways for organisations to discover cost savings, cloud ERP has its own unique suite of economic benefits. Legacy on-premise ERP used to involve large capital investment in servers and infrastructure, but cloud ERP is managed and maintained in secure datacenters which removes the need for these upfront costs.

For organisations with a broad geographic footprint, cloud ERP allows them to quickly add new users and locations to the system, without having to be tethered to physical assets such as servers. All you need is an internet connection (and obviously security clearance) to be added to the system and start working. This is the competitive agility that every organisation now craves.

With management and maintenance of physical infrastructure passed on to vendors, your IT teams are no longer spending their time dealing with servers, middleware and databases. On top of the potential savings on salaries, you’ll be getting more value from your IT team by using them for projects that deliver innovation and business value.

Without the need for physical deployments of on-site infrastructure, cloud ERP also provides exponentially faster time to value and return on investment. Without upfront capital costs and the need to install software across the organisation, you can begin benefitting from ERP capabilities much sooner.

It’s these capabilities that are the real icing on the cake from a cloud ERP system. Where software quickly loses value when it isn’t upgraded on a regular basis, we know from many of our clients that their legacy ERP systems are often several years behind in their version updates. Not only is that incredibly difficult to manage when integrating new hardware, it means your organisation is missing out on a variety of valuable ERP capabilities that your competitors are using.

At the end of the day, it’s about scalability and elasticity for seizing new opportunities while also having access to reliable services and taking advantage of significant cost efficiencies.

There are few organisations who want to specialise in hardware and infrastructure these days, so if your physical infrastructure isn’t your competitive advantage, you’re much better off focusing your resources on the competencies that make your business great.


About the Author:

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Paul Kruger

As the Director of Regional SAP Sales and Marketing at DXC Oxygen, I am committed to partnering with you to connect your individual requirements to SAP’s industry-leading solutions for helping your organisation improve its business performance.


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