What is Cloud ERP Software?
Most companies are familiar with ERP (Enterprise Resource Planning) software. They rely on ERP systems to help aggregate and organize data that is spread across each of its independent departments. Traditional ERP solutions are often housed within a company’s own server infrastructure and require updating and servicing to stay current. Cloud ERP, as the name suggests, is based in the cloud much like SaaS (Software as a Service.). Unlike traditional ERP software, Cloud ERP is Software as a Service that allows users to access ERP software over the Internet. Cloud ERP generally has much lower upfront costs, because computing resources are leased by the month rather than purchased outright and maintained on premises. Cloud ERP also gives companies access to their business-critical applications at any time from any location.
What are the benefits of Cloud ERP?
Low Barrier to Entry
Cloud ERP systems, like most software as a service (SaaS) products, have a much lower barrier to entry than on-premise systems. Since the software is hosted by another company, businesses don’t require the IT staff, servers, and other equipment that would typically be necessary to support it. The hosting company manages these instead.
This creates lower upfront costs for the cloud model, and additional payments are often made on a monthly subscription basis. As a consequence, smaller and mid-sized companies can reduce initial costs and adopt an ERP solution more quickly, though this advantage may not be as significant for larger companies (who likely already have access to an IT staff and equipment).
Cloud ERP Savings
Of the deployment methods, Cloud ERP provides the fastest path to implementation and avoids the need to fund physical on-site servers and in-house IT support teams. How significant is that? In the aforementioned report, 56% of respondents deploying Cloud technology reported implementation cost savings of at least 20%. Companies experience additional benefits by having the option of paying a fixed monthly management fee instead of the large upfront capital outlay required for On-Premise deployment. Moreover, lower monthly ERP costs allow companies to allocate finances toward physical expansion, growing the workforce, or any other key company initiative.
When a company decides it is ready for an ERP, it is usually an indication their current systems are no longer adequate for their business needs as they are in a growth mode. One of the most appealing features of any cloud-based ERP is its ability to easily scale up (or down) as a company’s needs change. With an on-site system, it is a time and labor-intensive process to scale capabilities. However, with cloud-based ERP you can move to a larger, more capable system immediately, affordably, and without limits. In addition, if you find that your needs change downward (e.g., seasonal needs) it is easy to scale back capabilities.
Security is the number one concern of many companies researching Cloud ERP, and most are surprised to learn that Cloud security can meet and exceed other methods of deployment, even On-Premise. Utilizing security best practices including backups and updates, Distribution One’s Private Secure Cloud Services cutting edge data centers are hosted and maintained by experienced technicians who continually test and improve systems to eliminate vulnerabilities to keep your data safe.