Service Level Agreements (SLAs) and contract terms. In cloud computing, customers give up some control to the vendor. When evaluating on-demand versus on-premises options, review the fine print of the contract terms before making decisions, and get answers to the following questions:

• Does the contract require an upfront long-term commitment?

• How easy is it to change the number of users? What penalties or per-user price changes are associated with these changes?

• Does the SLA supporting the uptime guarantee for these business-critical applications of at least 99.5%?

• What security features are supported?

• Investigate cloud vendor's disaster recovery and business continuity plans.

• What options and penalties does the vendor provide if you terminate the service? For instance, if you terminate the contract, how do you get your data back?

Address data security concerns upfront. Understand how the cloud vendor stores data, who can access it, and what safeguards the vendor has established to ensure that data is only accessed by authorised personnel. The vendor should be able to provide an audit trail on data access.

Application customisation requirements. Most SaaS applications are customised via configuration, instead of source code customisation. For affordable customisation of cloud computing solutions, aim for the 80/20 rule. Can the solution can get you at least 80% of what you need, and how much needed customisation cost?

Customers with very heavy customisation requirements may want to consider a packaged inventory software solution to achieve deeper customisation or SaaS technology implementation and customisation via third-party.

Invest more upfront in the evaluation and selection process. Most companies are under-investing when it comes to thoroughly evaluating business solution requirements and options. Seek the help of independent consulting organisations to better understand the total cost of on-demand and o-premise options as they relate specifically to your company's unique needs and budgetary constraints.

Carefully consider the benefits provided by a third-party VAR or SI. Many cloud computing vendors offer customers the option of purchasing the solution and consulting and support services directly from the vendor, or through a VAR or SI. In some cases, VARs and SIs may be a better fit for your company than the vendor in terms of their ability to provide industry-specific customisation, integration with existing applications, migration of data from existing applications, training and coaching for ramping up usability.

Assess the trade-offs of deploying an integrated suite vs. integrating applications from multiple vendors. With an integrated suite, all core management applications run on a common code base, and share the same database, providing a single, integrated system of record. This means that many front and back offices workflows are pre-integrated, enabling a higher degree of integration "out-of-the-box", additional custom coding or integration connectors and frameworks.

However, organisations that are happy with an existing front or back office solution may find it less disruptive and costly to integrate new functionality from another vendor, rather than to simultaneously deploy an entirely new front and back office suite.

Conclusions

By packaging all of the application software, IT infrastructure and services together in a Web-based, multi-tenant subscription model, cloud computing vendors have the ability to contain variable costs much more effectively than packaged software vendors-and pass these savings along to customers.

SMB and mid-market enterprise resource planning need solutions that enable them to meet their business goals, and also help them to conserve capital and reduce ongoing costs. Although one size does not fit all, for many customers, cloud computing business solutions can help organisations to achieve these requirements, and provide added flexibility to scale as business demands require.