Adopting an ERP solution—and deploying it in the cloud—was once considered a complex, expensive process meant only for large enterprises. Small and medium-sized businesses (SMBs) sometimes hesitated to make the leap to the cloud, worried about security, back-ups, risks of downtime, and whether they could adjust to out-of-the box functionality, forsaking their unique processes.
Those preconceptions are fading. Today, modern cloud solutions with built-in industry functionality and
implementation accelerators make cloud adoption easier—and more realistic—for companies of all sizes. SMBs, just like large enterprises, recognize the value of always up-to-date and highly flexible systems. SMBs also find some features of cloud computing especially helpful. As they tend to have lean staffs and limited expertise in IT security, SMBs often appreciate that cloud providers manage maintenance and security for them, including automatic back-ups. Cloud solutions also help growing companies scale,
easily adding locations or branches as the company expands. Growth also challenges organizations to enact best practices, automate, and reduce redundancies. Cloud-based solutions help start-ups and young companies establish foundations built on experience, standards, and operational efficiency. The SMB
gets the benefit of proven systems and expertise that is built into the cloud solution’s standard functionality.
As smaller firms are often innovative problem-solvers, more agile and flexible than large enterprises, they benefit from having cloud-based ERP solutions which can expand, contract, or branch out in new directions as needed to keep pace with changing demands of customers.
Analysts interpret the data
Cloud adoption is gaining momentum. A report from Synergy Research Group found that cloud infrastructure spending surpassed on-premises spending for the first time in 2020 by a wide margin, growing by 35% while spending on data center hardware and software dropped by 6%. A Forbes article credits the COVID-19 pandemic for helping to push SMBs to the cloud. The events of 2020 pushed many manufacturers to adopt remote connectivity and change the way they engage with colleagues and customers, the article says. The shift to the cloud was a necessity for many as collaboration and a flexible supply chain became critical.
Weighing the costs and benefits of single-tenant vs. multi-tenant cloud
For SMBs that are looking to move to the cloud, one of the most important decisions involves whether to deploy a single-tenant or multi-tenant solution. Both have unique benefits.
- Single-tenant architecture provides a single software instance for each client on the software as a service (SaaS) server, giving the business more control, but requiring more effort and investment. With single-tenant architecture, organizations can easily lift their legacy systems—with all their existing strengths and shortcomings—into the cloud. However, the organization often remains responsible for several functions, such as security and back-ups, which can add significantly to the cost of maintaining the solution. In addition, a single-tenant architecture is typically built on a static set of servers. As business activities increase, system performance can suffer until the system is redeployed on new servers, requiring downtime and potential business disruption.
- A multi-tenant environment lets several clients use the application within the same operating environment on the same hardware. This shared-cost model reduces investment and provides the benefits of standardized processes, maintenance, and security. In addition, well-engineered cloud applications enable personalization without compromising upgrades by using extensibility and platform tools rather than
code modifications.
Single-tenant and multi-tenant architecture don’t just differ in how many companies they can support in a specific cloud; they also demand different levels of responsibility from a given organization. This chart shows some key areas and the impact.
Stop by our blog for more details about the benefits of single-tenant and multi-tenant cloud and which is best for your organization.
