#FocusOnBestPractices
A recent report stated that the average ERP for manufacturing software budget per user is USD 9000. While 13% of the organizations globally upgraded ERP systems in 2019-20, 87% required ERP implementation assistance. While determining whether to transition the existing ERP solution to the Cloud or stay on-premises, businesses must understand the economic impacts of the current ERP solution and how the ERP for retail might look on the Cloud.
When organizations move from on-premises to cloud, there is a significant impact on the total cost of ownership. There are several different cloud forms, such as private, public, and hybrid, and each model has its own merits and cost. According to a report from Accenture, migrating areas of the business to the public Cloud can cut the Total Cost of Ownership (TCO) up to 40%. Total Cost of Ownership (TCO) is essentially a financial estimate that determines the economic value of an investment against the total direct and indirect costs over a system’s lifecycle. The graphic showcases a comparative cost analysis between the Cloud and on-premises.
In the manufacturing industry, leveraging cloud-based ERP solutions becomes crucial for optimizing costs and enhancing operational efficiency, making ERP for manufacturing an essential consideration during the transition to the cloud.
While visualizing a transition to Cloud, five cost areas, including software, hardware, implementation and training, IT personnel, and maintenance, affect TCO estimate. Moreover, the involvement of Microsoft ERP partners can help in cost analysis and implementation process.
To get a more detailed cost analysis between cloud and on-premise watch the below video.
Contact Korcomptenz today to perform a comparative TCO analysis. We are Microsoft Dynamics ERP partner who can help you get the knowledge needed to make a fully informed financial decision about the direction of the organization.
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