Economic Impact of Business Central in the Cloud: A View from Forrester

Even today, companies continue to run their ERPs on premises.

We understand – your staff is accustomed to the system, your processes are running smoothly, you have a significant investment in software customizations and the hardware required to run them, and you don’t have the time or budget to make the transition to the cloud. In short, by maintaining the status quo, there are no additional expenses, headaches, or surprises.

Or so it would seem. But the reality might be that you are limiting your company’s potential by staying with your on-premises ERP while your competitors are moving ahead of you.

In 2024, Forrester conducted a survey of 160 decision-makers from a wide variety of industries who had been running an on-premises Dynamics ERP product (NAV, GP, or Business Central) and had transitioned to Microsoft Dynamics 365 Business Central Cloud.

Even taking into consideration the investment in computer hardware plus the technical debt of years of customization in the on-premises ERP, Forrester found that over a period of three years, these companies averaged:

• A Return on Investment (ROI) of 265%
• A Net Present Value (NPV) of the investment to transition to Business Central in the cloud of $529k
• Payback within six months

Let’s take a closer look at the findings in that survey.

Why migrate to Business Central Cloud?

The respondents cited several reasons for migrating from their on-premises ERP to Business Central Cloud, among them:

• Trouble scaling for growth – As these companies grew, their costs increased for new hardware, additional personnel, more time spent maintaining the software and equipment, and increased partner support fees.
• Old data causing poor decisions – The lack of real-time data meant that business decisions were being made with outdated information, which resulted in poor supply-chain forecasting, inaccurate budgets, and lost sales opportunities.
• Problems updating the software – Updates were often an issue and required personnel from the company and the partner to deploy.

These companies were looking for an ERP that:

• Could scale with the business
• Support 24/7 remote access
• Include functionality out-of-the-box to minimize customizations and third-party add-ons
• Could be updated automatically

Tangible improvements, measurable benefits

Business Central significantly impacted staff productivity, with automation reducing the time finance and operations staff spent manually creating reports and reconciliations. Access to real-time data increased visibility across the company’s operations, improving management awareness and decision-making.

Business Central helped companies substantially improve their cash flow management and accuracy of financial reporting and shorten the financial close cycle time.

Survey respondents also credited Business Central with significant improvements in supply chain management, including:

• Better inventory management
• More accurate capacity planning
• Reduced average time per delivery
• Reduced inventory shrinkage
• Improved procurement

75% or more of the businesses surveyed reported productivity gains greater than 10% in the following areas, and roughly 25% of the survey respondents saw productivity gains greater than 20% in the same areas:

• Systems and data integration across business units and sites
• Automation
• Low-code or no-code customizations
• Business intelligence, analytics, and dashboards
• Personalization features

Companies also experienced improvements in their sales and support, including faster proposal generation, enhanced client search capabilities, and shorter sales cycles, which resulted in an average revenue increase of nearly 5%.

86% of the respondents also reported reduced IT support costs, including professional services, data center and hardware, licensing, and third-party software, with an average annual savings of $69,703 (a 55% reduction).

Some of the intangible benefits of Business Central include:

• Better business decisions
• Compatibility with Microsoft products
• Improved customer satisfaction and retention

Plus, almost every company claimed they could now scale their operations as their business grows.

Isn’t it time you moved to the cloud?

If you’re still running your ERP on premises, now is a good time to see if migrating to the cloud with Business Central is right for you.

Contact the Business Central experts at ArcherPoint by Cherry Bekaert to see what Business Central can do for your company.

Be sure to read the Forrester report, “The Total Economic Impact of a Migration to Microsoft Dynamics 365 Business Central.“

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