What is the Return on Investment for Cloud Solutions?

August 27th 2014 17:17:36 PM

Over the past year, we have introduced several new products and applications designed to help manufacturers and distributors capitalize on Cloud technology. By pairing our Sage 100 mobile apps with Scanco Cloud, we have revolutionized warehouse management and helped many manufacturers and distributors achieve what we like to call an intelligent warehouse. With instant access to the information in Sage 100 ERP (formerly Sage MAS 90 / Sage MAS 200), manufacturers and distributors can make the decisions they need to make in order to continue moving in a positive direction. We’ve watched mobile technology and the Cloud transform warehouses for the better: streamlining processes, providing instant access and visibility to business-critical information, and reducing errors. We believe so strongly in the power of the Cloud that we’ve created warehouse management applications that not only utilize this technology but rely on it.

Despite our own personal beliefs, we understand that not everyone is sold on the idea of Cloud-based warehouse management software. Some companies feel as though the Cloud is still too new of a technology to justify such a transition (although the Cloud – in one form or another – has been around for decades) while others feel that their operation is too small to make such an investment. For the sake of this article, we’d like to speak to the latter belief.

Evaluating the Value of Cloud-based Warehouse Management
Cloud technology doesn’t have to be expensive or a waste of money when done right. In fact, the return on investment can be far greater than expected, as many companies are quickly realizing. In fact, according to a recent report from Information Week, about 80% of the business professionals surveyed said they were “somewhat likely” to be evaluating for ROI of Cloud-based solutions. The benefits of the Cloud are convincing, leading many executives to evaluate the value of transition to the Cloud.
In order to gain a clear picture of the return on investment (ROI) of Cloud solutions, you need to have a clear understanding of the benefits you will experience as a result of implementing and using Cloud-based warehouse management software. Here are a few of the most common benefits our clients are experiencing:

• Improved visibility
• Increased efficiency
• Rise in productivity
• Streamlined warehouse management processes
• Better decision making
• Reduced costs
• Flexibility in deployment and hardware options

How to Calculate the ROI of Cloud-based Warehouse Management Solutions
While looking at the benefits can certainly persuade you of the value of the Cloud, you should not make a decision until you have calculated the expected return on investment of the solution in which you are looking to invest. While our Cloud-based Sage 100 mobile applications will certainly give you a leg up over the competition, investing in them before you are ready will only cause undo frustration and could add unnecessary costs to your already tight budget. Here are some practical tips to help you calculate the ROI of Cloud solutions:

1. Look at the cost savings and rate of adaption. Make a list of the cost savings you can expect from implementing Cloud solutions.
2. Calculate the total cost of ownership. For a realistic look at how quickly you can expect a return on investment, you need to be aware of the total cost of ownership. Account for everything so there are no surprises along the way.
3. Account for any cost increases and margin control. Take an honest look at the impact the Cloud will have on your business. Are there any hidden costs that could creep up down the road? Are the overall costs worth the investment?
4. Determine how long it will take your employees to learn the new application. Because the Cloud can be deployed on any device, training should not take long (if you require any training at all). Most companies simply download the application onto smartphones and tablets, eliminating the need to train employees on new hardware and speeding up ROI.
5. Assign monetary value to process improvements. If moving to the Cloud will reduce the time it takes your employees to complete certain tasks, calculate the value of this improvement. Cold, hard facts and figures like these will convince top executives of the value the Cloud can provide for your company.

Our Sage 100 mobile applications allow users to achieve a faster ROI than traditional warehouse management solutions. If you’d like to speak to an expert to determine whether the Cloud makes sense for you, give us a call today. We’d be more than happy to work with you to help you achieve the ROI you expect on your technology investment.