Posted by: Tyler Bower

There used to be a phrase in the technology space, “Nobody gets fired for buying IBM,” referring to the presumption that the megabrand was the only safe bet. Fast forward thirty years or so, and if you substitute “Microsoft” for “IBM,” the phrase could still ring true. Microsoft Azure is a presumptive choice for many businesses looking for a hosting platform for their business applications, including their Sage ERP. But a presumptive choice is not necessarily the best choice. Public cloud deployments come at a high cost — and much of that cost is hides in layers. What is the true cost of public cloud?

X degrees of separation

If you select a public cloud provider like Azure to host your Sage ERP application, you’ll quickly find it’s a relationship that involves layers. Lots of layers. You will likely never have direct contact with Microsoft; your relationship with them will go through intermediaries such as a cloud services provider (CSP). In some cases, there may more than one intermediary CSP. If you rely on a managed services provider (MSP), they’ll be one of the layers too. It’s worth noting here that none of those layers is familiar with Sage ERP.

Why do layers matter? Layers matter because they create bottlenecks, finger-pointing, and delays when something goes wrong. If you cannot log in to your Sage ERP application, who’s fault is it? If you receive an error message, which layer takes responsibility for fixing it? What value do you place on the potential productivity and revenue losses associated with downtime?

What? That’s not included?

We find that companies considering hosting their Sage ERP application often have misconceptions about what Azure provides as part of the public cloud hosting arrangement. Support, backups, remote connections — not included. Software updates, bug fixes, disaster recovery options — not included. These will all be your responsibility. To get a real SaaS experience, you’ll need to turn to one of your layers or your internal IT staff to handle the details that Azure does not.

This leads us to another common misconception. A primary reason that companies cite for moving to a Hosted ERP model is the reduced need for IT resources. In many cases, though, the IT load remains the same or even increases. This can happen when your internal IT personnel or your outsourced IT firm has to spend more time managing the layers — communicating and troubleshooting on your behalf. You, of course, will be paying for that time.

Punished for growth

One of the most complicated pricing models in the tech industry is public cloud providers’ data usage fee structure. You may be told you’ll pay only for what you use, but it’s exceedingly difficult to estimate usage — and overage costs are high. We’ve had clients move to our Cloud at Work Sage ERP private hosted platform because of frustration with unpredictable and expensive data usage charges. Some tell us they felt like they were being punished for growing.

To calculate the true cost of public cloud, you must factor in the additional costs associated with bringing your Sage ERP to life on the public cloud — and the ongoing costs of supporting it and maintaining it there. You should also factor in your risk tolerance surrounding troubleshooting and downtime. With layers in between you and Azure, and each asking for a piece of the pie, the true cost can be much higher than expected.