Call it a sea change. The number of businesses using cloud-based ERP has shot up dramatically over the past three years, says the International Data Group. In 2017, less than half of companies and organizations implemented cloud-based or SaaS (software as a service) solutions, while the remaining ones used on-premise platforms.

In 2018, 76 percent of businesses were either planning to transfer or have already moved to the cloud.

As a result of the shift, research suggests that the market for cloud-based ERP will jump to $29 billion in 2019, jumping by $11 billion from the $18 billion registered in 2016.

Enterprises predict they’ll invest, on average, $3.5 million on cloud apps, platforms, and services this year, too.

Multi-cloud strategies

Some 30 percent of all IT budgets were allocated to cloud computing, with the majority being SaaS (48 percent), IaaS (infrastructure as a service, 30 percent) and PaaS (platform as a service, 21 percent).

In 2018, IDG reports, 73 percent of US companies had at least one application already in the cloud and another 17 percent planned to do the same in 2019, with an average budget of $2.2 million.

Almost four out of 10 executives said their IT departments felt the pressure to move to the cloud.

Some 42 percent of business used a multi-cloud strategy that involves the use of two or more cloud computing services, and 59 percent of companies said this approach increases their cloud options.

Another 40 percent said a multi-cloud strategy makes disaster recovery easier and faster.

Some 47 percent of companies use on-premise ERP but use application programming interfaces or APIs to extend to the cloud.

Meanwhile, 22 percent of organizations use on-premise ERP but are looking for managed hosting or IaaS.

Cloud-based software has gained traction over the years because of the operational efficiencies that it has to offer as well as its cost-efficiency. CFO Magazine, for example, notes that cloud-hosted ERP is cheaper than on-premise solutions by 30 percent.

Among the advantages of Cloud ERP:

* Companies need very little in terms of IT resources to implement or support such a system, and the software is always current and supported by the vendor.
* Time to deployment is faster, as is the time to value, and there is less risk involved.
* Cloud-based systems are scalable on both features and users, and costs can be aligned with a company’s growth.
* There is good integration with other cloud-based products.
* Cloud-based systems offer better security and operations than companies can otherwise afford.