There are many compelling reasons for a company to shift its ERP system to the cloud. It can free up valuable IT resources, potentially save money, and improve the flow of operations. Here are 6 financially motivated reasons to move to the cloud.

Lower Power Costs: Cloud computing uses less electricity. This not only produces an obvious environmental benefit, but also a cost savings benefit. When you run your own data center, your entire system won’t be fully utilized, which leads to wasted energy. With a cloud server, you are spending less for energy than you would be with an on-premise system.

Lower People Costs: Good IT people cost money. And although you still need good IT personnel when using a cloud-based system, you need less of them.

No Capital Costs: Upfront capital costs are a necessity when implementing an on-premise solution. By investing in a cloud computing system you are freeing up capital to be invested elsewhere in your business. Instead, you’ll only be paying for what you use, with few fixed expenses.

Newest Versions: Because hosted cloud ERP systems are regularly updated, you can expect that users will welcome this new functionality, and in turn become more productive.

Faster time to value: You achieve a positive return on your investment much faster with a cloud system. This is because you do not need to purchase equipment, the set up time is greatly reduced, implementations are faster and the upfront investment is lower.

Resiliency: When you own your own servers you need to ensure that you have backup hardware so that if your hardware goes down you don’t lose all your data. This means you need to have spare hardware lying idly by in case there is a system crash – this is an expensive way to ensure you don’t lose your data. With the cloud this problem is tackled by an external, third party organization. Typical clouds have several locations for their data centers, with your data mirrored across at least two of them. This is a much cheaper way to back up your system.