As the saying goes, “The best ability is availability.” Your ERP system could have all the trendiest bells and whistles and none of it will really matter if the system can’t stay online. And when your system is down, the costs add up quickly. Over the past decade, studies have estimated the cost of downtime for small and medium businesses to be anywhere on average from $429 per minute or more, and for larger organizations, that figure can be as large as $9,000.
Some SMBs figure that the best way to keep their system up and running is to host it on premises, where they can keep an eye on it. The truth is that on-premises servers are much more vulnerable to downtime than Cloud-based servers.
What Makes On-Premises ERP Systems More Prone to Downtime?
There are plenty of reasons an ERP system might go down, and all of them are more likely to happen to an SMB with an on-premises server.
Ransomware attacks
More than three-quarters of documented security breaches happen to SMBs. Why? Because they often don’t have the time or resources to properly protect their own servers. Before working with Enavate, one of our clients experienced a ransomware attack on their on-premises server, which locked them out of their Microsoft Dynamics GP system for days. When you do the math based on the figures above, you’ll see how much that cost them in terms of lost revenue and productivity. Meanwhile, Cloud-based servers mean you can lean on Microsoft’s powerful security capabilities to keep your data safe and your system up.
Natural disasters
Natural disasters have always threatened business continuity, and now they’re happening more frequently than ever before. In fact, there were 83% more natural disasters from 2000 to 2020 than from 1980 to 1999. Another one of our clients came to us after Hurricane Milton flooded their servers in Ft. Myers Beach, Fla. Without Cloud-based backups, they were totally offline and unable to recover quickly.
Power outages
Power outages happen for many reasons, and they’re frequent enough to cost U.S. businesses $27 billion annually. One rural business we work with had their Dynamics GP server go down during a major power outage, causing significant delays in payroll processing and invoicing. They would have avoided downtime altogether if their system had been hosted on the Cloud.
Failed backups
SMBs have a lot on their plate, and data backups tend to slip down the priority list. When data loss occurs, that slip can cause significant issues. One company we work with experienced data loss and made efforts to reinforce their backup process. Unfortunately, they later discovered that their IT department never actually followed through with the plans, leaving them vulnerable to even more data loss in the future. Human error, media failure and patch-related misconfigurations are more likely — and harder to deal with — when your company maintains a local sever while focusing most of its energy on day-to-day business.
Overwhelming growth
Growth should be a good thing for SMBs; however, when they keep their ERP on premises, it can be something of a curse. They often find themselves either overbuying computing resources for peak times or totally unprepared for growth when it arrives. One rapidly expanding company quickly found that their on-premises servers couldn’t handle increased data and user demand, leading to poor system performance and frequent crashes. Accommodating growth without downtime is much easier when you can pay for exactly as much Cloud server space as you need.
Risky infrastructure
Auditors previously informed one Enavate client that their aging, unsupported server was a major compliance and security risk, and it needed to be replaced soon before it failed catastrophically. The price tag to keep their system on-premises was eye-popping. The average cost for SMBs to acquire a new server is at least $1,000 and as much as $2,500, and then the average cost to maintain that server is another $1,500 per month. That’s a lot of money for something you can’t even depend on to stay up, and why they leaned on our team’s expertise to move to the Cloud.
Relocation logistics
With an on-premises server, moving to a new office can be a logistical nightmare. One of our clients switched to the Cloud when they realized that the cost and complexity of transporting, setting up and maintaining their server at their new location would be overwhelming. The global public Cloud services market is expected to surpass $1 trillion, in part because Cloud servers ensure business continuity, even through a physical relocation.
Stay Online by Partnering with Enavate
SMBs don’t have to keep their ERP systems operating all on their own. A proven tech partner like Enavate can help your business move to the Cloud and experience 99.95% guaranteed uptime. Reach out to our expert team today to learn more.
Learn more with this recent webinar on-demand.
