In the past, business owners have invested primarily in on-premises enterprise resource planning (ERP), which means the servers are at the company’s headquarters and maintained by on-staff employees. When it comes to the advantages of cloud ERP, there are three main areas to consider:

1. Cost

The low entry cost of cloud-based software, compared with hefty introductory license fees, has contributed to its prevalent adoption. According to a study by IDG, 69 percent of enterprises were using cloud-based software or system architecture in 2014. There are also no additional hardware investments, such as server infrastructure.

“ERP software has the most direct impact on reducing costs by improving efficiencies,” says Rhianna Collier, vice president and managing director of the Software and Services Division for The Software and Information Industry Association, explaining it can help executive teams make better business decisions. The software eliminates instances of double data entry, greatly improving efficiency. “Time is money; the more time employees spend repeating tasks, the less revenue you’re generating.”

2. Security

One of the biggest disconnects preventing cloud-based infrastructure and applications from widespread adoption is concerns about data security. While purveyors pledge strict data security guidelines, some organizations might not have total peace of mind with this arrangement. However, as technology continues to change and data becomes more complex, some organizations might not be as adept at practicing proper data security protocols. Cloud vendors excel in testing for vulnerabilities and patching systems with exposed weaknesses.

3. Implementation

“I think implementation is the number one reason a company will walk away from an ERP,” says Collier, urging businesses to consider whether or not the software provider will be a good partner. “Will they be committed to your success?” she asks. “Are they as committed to your success as you are?”

The ability to get up and running quickly is one of the most common reasons why enterprises are transitioning to the cloud today. “Resources are tight in any business today,” says Collier. “By streamlining you increase profits and better communication and efficiency across the company.”