Summary: Enterprise software is evolving under selection pressure from challenging economic conditions and the adaptive possibilities afforded by cloud computing, mobility, big data analytics and social engagement.  - By Charles McLellan 
Global enterprise software trends
How big is the enterprise software market? In Gartner's latest worldwide IT spending forecast (March 2013), enterprise software accounts for $296.6 billion in 2013, showing an annual growth rate of 6.4 percent over 2012's $278.8bn. The only sector currently growing faster in Gartner's forecast is Devices, at 7.9% (driven by premium smartphone upgrades). Enterprise software only comprises 7.89 percent of the 2013 IT spending pie; the biggest slice, 44.8 percent, goes to Telecom services:

At $297 billion, enterprise software will account for 7.89 percent of the total worldwide IT spend in 2013, according to Gartner's forecast. (Data: Gartner Market Databook 1Q13 Update)Gartner's figures are projected to 2017, over which period Enterprise software shows the biggest CAGR (6.6%), resulting in a spend of $383.8bn (out of $4,384bn, or 8.75 percent).

These high-level numbers only tell part of the story, however, as there are considerable changes afoot when it comes to the types of enterprise software that CIOs are considering buying.Gartner's January 2013 CIO Survey puts Analytics & Business Intelligence (BI) at the top of the priority list, followed by Mobile technologies, Cloud computing and Collaboration technologies:

There are several advantages of Cloud/SaaS over On-premise ERP software (or any software solution).  Before we get into the benefits, let us look at the basics:

Definition according to Wikipedia - SaaS - Software as a service sometimes referred to as "on-demand software", is a software delivery model in which software and associated data are centrally hosted on the cloud. SaaS is typically accessed by users using a thin client via a web browser.

According to me one of the biggest advantages of SaaS is its pay as you use model, there is minimum or no upfront cost. This advantage is most beneficial to SMEs.

We can categorize all the benefits of SaaS over On-Premise into two, tangible (measurable) benefits and intangible (strategic/not measurable) benefits.  

Tangible Benefits of SaaS ERP:

·         No Upfront cost: pay  as you use model
·         Availability: up to 99.999%  uptime
·         Reliability : Automatic back up & data security (physical as well as digital)
·         Automatic Upgrades: no upgrades  requires
·         Faster & easier deployment
·         Fewer IT resources required
·         Minimum IT hardware/software required
·         Better ROI/TCO
·         No AMC required
·         Energy efficient ( greener solution)
·         Better productivity & performance
·         Lower operation cost & better bottom line

Intangible Benefits of SaaS ERP:

·         Better accessibly (anytime, anywhere)
·         Quicker scalability
·         Customer satisfaction
·         Employee satisfaction

While we are discussing the advantages of SaaS over On-Premise solution, let us also look at the disadvantages of SaaS (which are the advantages of On-Premise):

·         Very limited control over the software/data
·         Minimum customization available