Kati Unplugged: ERP On-Premises or in the Cloud? It’s All about Customer Needs

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A Blog Series for Microsoft Dynamics Partners by Kati Hvidtfeldt, US Microsoft Dynamics ERP Cloud Lead.

Kati color 2004In the last two Kati Unplugged posts I’ve focused on the importance of the partner’s role in ensuring a successful implementation. That means understanding the customer’s situation, business challenges, and potential issues.

Continuing on this theme, this week we feature ERP Senior Product Marketing Manager Jay Manley’s perspective on the issues customers should consider when selecting a deployment model for their ERP solutions. Jay has worked in ERP for almost 2 decades in various roles including consulting, sales, and product marketing.

This is part of the content Jay presented in his recent webinar, “ERP on Premises or in the Cloud: What's Right for Your Business?” from the Microsoft Dynamics ERP series for SMBs.


I’ve seen a lot of change in the ERP space over the years. One of the more impactful changes is in the way people work on a daily basis. Right now, one billion people are working in some kind of mobile environment through a variety of devices, and those devices are constantly changing. Younger employees in particular demand the convenience of on-demand access to the information they need to do their jobs. Companies that don’t support them in the right way with the right tools will not only lose productivity, but will risk losing their younger workforce to competitors.

Another change is occurring around how we think of infrastructure. We used to think of IT infrastructure in terms of the big data centers in corporate offices. But today even a couple of servers sitting in a back office can be considered a data center. For many companies, servers sit idle 85% of the time, and it can be hard to justify the expense.

And a third change is around IT budgets. Systems age, and the people who work for you get frustrated if your company runs out of disk space or processing power, or if systems are preventing them from doing their jobs efficiently. Even for small data centers it can be complex and costly to maintain and replace the hardware and software every 2-3 years to keep systems running smoothly. Since 2000, IT budgets have been slashed. And an estimated 70% of IT budgets are being spent on server maintenance.

This all boils down to a situation of more demand with reduced resources. Companies need to figure out how to address this challenge in a reasonable fashion. For a long time there’s been a debate on the benefits of maintaining on-premises systems vs offloading and outsourcing systems to a hosting provider in a cloud-based deployment scenario.

Customers may have reasons to keep some systems internal to maintain full control. But they may still benefit from saving on infrastructure and expense by choosing a cloud model for other systems. And by handling expenses via predictable monthly charges, companies take a lot of guesswork out of budget planning.

The good news is, Microsoft now offers deployment flexibility across our product offerings, even those typically thought of as being delivered on-premises. Now ERP deployment options for small and mid-size businesses are offered through a partner-hosted model as well as through an ERP system that is delivered not only on-premises, but also through a web client for remote connection—with no additional software required.

With more choices available, it’s the partner’s role to work with customers to help them understand the best deployment mix—and how they can transform their businesses to take advantage of these new technologies.


To view Jay Manley’s full on-demand webinar, with a Microsoft Office 365/Microsoft Dynamics GP product demo by Microsoft Lead Partner Consultant Jodi Christiansen, view the webcast “ERP on Premises or in the Cloud: What's Right for Your Business?”

To learn more about how to incorporate cloud-based solutions into your business plans visit the Microsoft Dynamics Countdown to the Cloud page on PartnerSource. Go to www.microsoft.com/dynamics/growyourbusiness for resources that demonstrate to customers how Microsoft Dynamics ERP cloud, hybrid, and on-premises solutions can benefit their businesses.

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