SaaS ERP is Expensive – Is it Worth It?
If you are a small company with 20 or less users, you will probably find great success with SaaS products like NetSuite. You will appreciate the simplicity of the application. You will enjoy the canned process to turn purchase orders into material receipts. For the first time, you will be able to enjoy connecting your people and processes together to eliminate double and triple data entry. At $40K for the go-live and $20K per year in recurring license, you can justify the cost because your payroll expense goes down by at least that much. Such is the promise of ERP- right?
If you are a medium company with between 30 and 300 users, the above bliss will quickly turn to frustration. The canned processes are now creating bottlenecks for your receiving processes. Your inability to make changes to the system is causing your users to export to excel and manipulate data outside of the system. Your month close process becomes more difficult because your operations no longer tie nicely to the general ledger. You become dependent on adapters to connect external tools to your data. The incremental cost per user starts to negatively impact growth and change initiatives. SaaS ERP quickly becomes one of your biggest expenses next to payroll.
Is there a better way for medium-sized companies to gain the benefits of cloud ERP without the frustration of the SaaS model? The answer is simply: yes. I would like to introduce you to the Personal ERP Cloud. The concept is not new; however, its impacts are far reaching. Simply put, the personal cloud entails deploying commodity products on a commodity infrastructure.