Dog goes “woof.” Cat goes “meow.” But, what does the cloud say? Cha-ching, ching, ching?

YouTube Image of Ylvis “The Fox”

Have you heard that catchy song, “What does the Fox Say?” by Ylvis?  The two brothers from Norway had no idea that their somewhat silly song would become a huge hit and that the video would go viral.    Personally, I can’t get the song out of my head!  I find myself making up lyrics to the popular tune (hence, this post’s title.)

Much like the intriguing popularity of the song, cloud computing is all the talk among business and technology communities.  We’ve heard the many strengths and weaknesses of this new technology, but let’s focus on one in particular, the economics of the cloud (A.K.A. the ’cha-ching’.)   What do the economics of the cloud really look like?  Which organizations realize the most value from cloud-based enterprise resource planning (ERP)?

There are economic advantages the cloud has over traditional on-premise ERP installations.  Aside from predictable cash flow and lower initial start-up costs, with Software as a Service (SaaS), the savings often come from the inherent lower personnel costs and hardware outsourcing.  Those savings are then invested in process improvements to drive organizational efficiencies and the longer term benefits are unlocked.

Let’s touch on which organizations realize the most value from cloud-based ERP.  Typically, the economics of the cloud, or a hybrid cloud strategy, become more compelling for larger firms when considerable spending decisions come up such as an upgrade or the need to purchase a new module.  On the other hand, for small and mid-size companies that can’t easily afford to own and maintain their own ERP systems, cloud ERP economics tend to make the most sense.  Their business requirements are simpler and there is increased pressure to keep costs down.  A cloud ERP solution allows growing businesses to be up and running quickly giving them increased visibility, insight and on-demand access from any device, from anywhere.  It’s just the edge they need in a competitive marketplace.

Considering the cloud a tool for increasing profitability rather than reducing costs may be the best approach when it comes to cloud economics.  The ability to move quickly and the capacity to implement applications as needed, means businesses are more agile and can address consumer demand, target new markets, and expand product lines more rapidly.  If the cloud produces new or previously unattainable revenue streams (cha-ching!), the potential cost savings on legacy infrastructure become less significant.  If you’re considering cloud-based ERP, BDO Solutions can help you assess the value of a cloud based business management system for your business.  Contact us for more information or visit us at www.dynamicsstratus.com.

By Danielle Moriana , Business Development Manager with BDO Solutions, specializing in Microsoft Dynamics ERP Cloud solutions.

About BDO Solutions

BDO Solutions is a national firm with local practices throughout Canada, a Microsoft Gold Certified ERP and CRM Partner and Reseller of the Year in Canada for 2010, 2011 and 2012.

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