Cloud vs Installed ERP System / Software

What is difference between Cloud Based and Installed ERP Software?

Installed ERP software is installed in your company location or dedicated server purchased by your company. Whereas, Cloud Based ERP Software means your are just using the software provided by the vendor and you don't know or need not know about the Server and related maintenance.

Why choose between Cloud vs Installed ERP software.

When we have to choose a new enterprise resource planning (ERP) system, the most critical factors in your choice will be whether you choose to deploy it on cloud or in install based. After knowing the advantages and disadvantages of each type of ERP system, business owners can easily determine the best fit for their choice, allowing for a more informed allocation of resources and a more efficient ERP workflow. Don't know why there are still some reasons the business owners like to go with traditional style installed ERP software. Which one to choose is totally depends on owners itself.

Deployment and Pricing of Cloud vs Installed ERP.

The biggest difference is depend on how these software’s to be deploy. Cloud-based software is hosted on the vendor's servers and accessed through a web browser. Installed software is installed locally on a company's own computers and servers. Another big difference is how these products priced.

  • As there are many exceptions in this rule but in general cloud based ERP software’s “is priced under a monthly or annual subscription”, with additional recurring fees for support, training, updates and maintenance.
  • An installed based ERP software is generally consist of “one-time perceptual license fee”. Still there are recurring fees for training, support and maintenance.

Comparing Advantages of Cloud & Installed ERP

Cloud Based ERP

  • Cost - It can be predicted over time. Cheaper upfront investment. No additional hardware investments. (E.g. server infrastructure)
  • Security - Data security is in the hands of vendor.
  • Customization - Offer greater stabillity and continuous updates from vendors as a result of less customization. Organizations can work with vendors to see what changes can be made.
  • Implementations - Typically take less time to implement.

Installed / On-Premise ERP

  • Cost - Reduces initial price of system.
  • Security - Data security is in the hands of organizations.
  • Customization - Greater abillity to customise.
  • Implementations - Organizations has more control over implementation process.


  • When we have to choose the new ERP system there are many ERP options than ever for all types of businesses. Cloud-based deployment models have made this software more accessible for SMBs-though these systems come with a few drawbacks, such as more limited customization and potential security concerns.
  • Conversely, installed ERP systems offer advantages in customization and control, but are more expensive upfront, and many don't support mobile. This can be problematic for smaller buyers but, as is usually the case, it depends on the specific needs of the individual business.

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