The benefits of cloud computing far exceeds its license costs.
Take a group of 50 companies for example. I asked ChatGPT for an estimate of the human, software, hardware and infrastructure costs incurred in owning and hosting your ERP’s databases.
Here is the estimate I got, just to ‘own data’.
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Implementing an on-premise ERP system for a large group of companies involves several cost considerations.
Here’s a breakdown of the key components:
1. Server Costs
To handle up to 100 000 transactions a day with low latency, you’ll need a high-performance server. The cost of such a server can vary widely based on specifications, but you can expect to spend between $40,000 to $130,000. This includes the hardware, initial setup, and possibly some software licenses.
2. Team Structure and Salaries in Mauritius
For supporting the ERP system, you’ll need a dedicated team. Here are the typical roles and their estimated salaries based on your provided figures:
Salaries: (Excl. company paid taxes and HR costs)
• ERP Manager: $ 2 500 per month
• Senior Consultants: $ 2 000 per month
• Database Administrator (DBA): $ 1 500 per month
• IT Support Staff: $ 1 000 per month
3. ISO Certification
To achieve ISO certification, you’ll need to follow a structured process which includes:
• Preparation: Documenting your management system and processes.
• Internal Audits: Conducting internal audits to ensure compliance.
• Certification Audit: An external certification body will audit your processes.
• Ongoing Compliance: Regular reviews and audits to maintain certification
4. Data Protection Compliance
Ensuring compliance with international data protection regulations involves:
• Legal Compliance: Adhering to laws such as GDPR, which may require specific data handling and protection measures
• Technical Measures: Implementing robust security protocols to protect data.
• Administrative Measures: Training staff and establishing policies for data protection
Summary of Costs:
• Server: $40,000 to $130,000
• Monthly Salaries: Approximately Rs 300,000 to Rs 400,000 for a small team
• ISO Certification: Varies, but can be a significant investment in both time and money
• Data Protection Compliance: Ongoing costs for legal, technical, and administrative measures.
Setting up and maintaining an air-cooled server room, along with a mirrored backup, involves several cost components. Here’s a detailed breakdown:
1. Hardware and Infrastructure Costs
Primary Server Room:
• Servers: High-performance servers can range from $5,000 to $20,000 each. For handling 5 million transactions a day, you might need multiple servers, potentially costing around $100,000 to $200,000https://dgtlinfra.com/data-center-cooling/.
• Racks: Server racks cost between $1,000 to $2,000 eachhttps://blog.servermania.com/server-room-requirements-and-costs-to-build.
• Networking Equipment: Switches, routers, and other networking gear can cost around $10,000 to $30,000https://blog.servermania.com/server-room-requirements-and-costs-to-build.
• Power Supply: Uninterruptible Power Supplies (UPS) and backup generators can cost $20,000 to $50,000https://blog.servermania.com/server-room-requirements-and-costs-to-build.
• Cooling Systems: Air conditioning units specifically designed for server rooms (CRAC units) can cost between $10,000 to $30,000https://dgtlinfra.com/data-center-cooling/.
Secondary (Mirrored) Server Room:
• Duplicate Hardware: Similar costs as the primary server room for servers, racks, networking equipment, and power supply.
• Additional Cooling: Similar costs for cooling systems.
2. Electricity Costs
Electricity costs can be significant, especially for cooling. Here’s a rough estimate:
• Power Consumption: A single high-performance server can consume around 500 to 1,200 watts per hour. Assuming an average of 850 watts per server, for 24 hours a day, the daily consumption per server is about 20.4 kWh.
• Total Servers: If you have 50 servers, the total daily consumption is 1,020 kWh.
• Electricity Cost: Assuming an average electricity cost of $0.15 per kWh, the daily cost for running the servers is approximately $153, and monthly around $4,590
Cooling Costs: Cooling systems can consume about 40% of the total energy used by the server room. If the servers consume 1,020 kWh daily, cooling would add approximately 408 kWh, costing an additional $61.20 daily, or $1,836 monthly.
3. Total Monthly Electricity Costs
• Servers: $4,590
• Cooling: $1,836
• Total: Approximately $6,426 per month
4. Additional Considerations
• Fire Suppression Systems: Essential for safety, costing around $10,000 to $30,000
• Security Systems: Physical and network security measures can add another $10,000 to $20,000
• Maintenance and Upgrades: Ongoing costs for maintenance, upgrades, and potential expansions.
Summary
• Initial Setup Costs: Approximately $300,000 to $500,000 for both primary and mirrored server rooms.
• Monthly Electricity Costs: Around $6,426.
These estimates can vary based on specific requirements and market conditions.
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Now add the OnPremise ERP, CRM and Bi license costs as well as per user access fees and you will understand the seriousness of ERP, data hosting and security.
We help companies of 15M $ to 300M $+ annual revenue run a state-of-the-art cloud ERP for 6x less TCO than on-premise alternatives.