Did you know 92% of businesses say their IT environment depends on cloud computing?
Cloud ERP, or cloud-based enterprise resource planning, refers to deploying an enterprise resource planning (ERP) system in a cloud computing environment. Cloud ERP solutions allow companies to access their ERP software and data from any location with an internet connection rather than being restricted to accessing the system physically.
Cloud ERP systems provide many benefits to organizations, including reduced hardware and software costs, improved scalability and flexibility, and increased security and data backup capabilities. These systems also often offer a variety of integrations with other cloud-based software and applications, allowing companies to create a seamless ecosystem of cloud-based tools and services.
In 2023, companies also prefer to have their enterprise applications off-premise and in the cloud. However, the cost is a significant factor in choosing a cloud ERP over an on-premise option and its ease of use and adaptability.
Some of the other benefits of using Cloud ERP include:
- Accessible from anywhere
- Quick install or migration
Read on for more information on why a move to a Cloud ERP can assist your business in reducing operating costs and improving productivity, data access, storage, and security.
Reduced Operating Costs
Using ERP in-house means buying the software, multiple licenses, and the servers and computers to support it. You also need staff on-site to install and maintain it, which increases the IT budget.
But cloud-based ERP usually allows you to pay a flat fee every month, so your implementation and usage costs should be lower. In addition, many ERP providers can even manage the tool for you, lowering your operating costs.
One of the reasons many companies maintain old computers and databases is the expense of migrating to something better. But migrating to cloud-based ERP is another story.
Going to the cloud with your ERP doesn’t require weeks of installation, and there is seldom any downtime.
Most cloud ERP systems also have a monthly access fee that makes it easy to understand what it will cost.
Use Cloud ERP Anywhere, Anytime
Using ERP in the cloud doesn’t depend on your company’s infrastructure, so your team can access vital systems anytime and anywhere they are. This means they can work from home, essential during the COVID-19 pandemic.
Even if your company’s IT system goes down during a natural disaster, your workflows and data will run in the cloud.
No Software Licensing Audits
Software companies are more aggressive about checking businesses that buy their software. But, even if the company plays by the rules, it’s costly and time-consuming for a software company to audit you.
When you use cloud ERP, you never have to hassle with software and audits. This means more time for your employees and co-workers to focus on their jobs.
Improved Business Intelligence
Cloud ERP lets your company access its data remotely without having a large IT staff of complicated hardware configurations. Over the last 24 months, the number of companies using business intelligence via the cloud has increased by 100%.
BI adoption is growing among marketing and sales staff as they use real-time data to improve the customer experience.
Focus On What You Do Best
Many companies don’t have the money to have a large IT staff and could never match what the cloud ERP company offers for a reasonable price. If your company has skilled IT staff, using it to implement and manage an ERP system may not be in your best interests.
Cloud ERP allows businesses to outsource their IT needs and focus on what they do best. For example, if your company sells clothing, you can focus on improving products and the customer experience instead of maintaining servers.
Save Costs Up Front
The upfront cost is one of the biggest challenges for implementing a local ERP. Using a cloud ERP at first and over the first year or so is less expensive. Of course, the costs add up over time, but many executives are more concerned about reducing capital expenditures than anything.
If that’s true, your company could benefit from using cloud ERP. But note that the long-term costs of using cloud ERP can be less for smaller companies; local ERP hardware and maintenance costs can be too high to justify the costs.
Your ERP system handles vital business data, and this information mustn’t get into the wrong hands, whether that’s unauthorized users or other unwanted parties. To keep this information safe, cloud-based
ERP offers substantial security measures that continuously safeguard your data when it’s at rest and when it transfers from your system to the servers.
Also, users must have an encrypted account to get into your ERP system. This allows you to limit who can access the system and who cannot. You also can restrict system access through the administrative panels.
Cloud ERP Hurdles
While there is plenty of upside for businesses choosing a Cloud ERP, there also are some challenges that need careful consideration including:
- Security is not the same with every cloud ERP system. Therefore it pays to do thorough research and consider engaging a third-party security expert to ask vendors questions about their security and privacy features.
- Ownership – you don’t own the software using a cloud ERP system. So, the provider will update its entire product, whether you like it. You could have updates happen with little warning, too.
- Internet access – if you have ERP in the cloud, you depend on your Internet access. So, it’s essential to have an excellent Internet provider.
- Additional costs – you could incur more as the years pass; the more modules you use, the higher the monthly fee.
Cloud ERP solutions offer a modern, flexible, cost-effective alternative to traditional on-premise ERP systems. While going with a cloud ERP has some challenges and therefore requires some thinking, it’s a move many companies have made with great results.