What is Cloud-based ERP Software?

Posted on: 9th April 2018

You have probably heard all about the many silver linings cloud computing brings to businesses. In our opinion, the brightest benefits of all are offered by cloud based ERP software.

Cloud ERP systems provide a sophisticated and comprehensive approach to integrated operations management that is flexible and affordable enough to suit businesses of all sizes. But how exactly does it work, and why should you consider investing for your business?

What is cloud based ERP software?

Enterprise Resource Planning (ERP) software has been around for a long time. ERP is a term used to describe the management of a range of core operational activities. Most definitions of ERP will cover logistics, procurement, inventory, merchandising, finance and HR, often with crossover into marketing and CRM as well.

ERP software integrates management and oversight of all of these operations into a single platform. ERP systems use a single shared database for multiple applications, ensuring all areas of a business are making decisions based on the same data and driving a more complete and holistic approach to business intelligence.

Cloud ERP solutions offer the same functions but with a different point of access. Instead of buying software and then installing and staging it in your own on-premises data centre, cloud ERP systems are available as a Software-as-a-Service (SaaS) solution.

With SaaS, you buy subscriptions to access applications that are hosted remotely by a third-party provider. Instead of having ERP software running in your own data centre, you connect to the applications you need via the internet, much as you do when you open a web browser or even an application on your smartphone.

What are the benefits?

Compared to legacy on-premises ERP solutions, cloud based ERP software offers much better value and flexibility, especially to small businesses. Instead of making a capital investment purchasing what is often very sophisticated and expensive software, cloud ERP systems allow businesses to get the same benefits financed as an operational expenditure (OPEX) - monthly charges instead of a lump sum up front.

Buying advanced software outright also attracts long term running costs. Once it is installed in your data centre, you are responsible for all updates, upgrades, maintenance and repairs. With SaaS, this all comes as part of the service.

What many small businesses enjoy about cloud based ERP software is the ability to choose only the parts they really need. Platforms like NetSuite, the world’s most popular cloud-based business management suite, are modular, meaning you can subscribe to different packages containing different applications. Instead of having to buy a complete suite outright, which may include many applications you may never use, cloud ERP software allows businesses to mould solutions to their needs.

A related benefit is that cloud based ERP software tends to be much easier to integrate with wider operational IT, such as CRM and accounting software. Many SaaS providers now follow an ‘open architecture’ policy of designing solutions so they can be readily linked with software developed by other companies.

Cloud ERP systems also offer greater mobility than traditional on-premises. For the modern business where mobile and remote working is increasingly important, the ability to log onto a business platform from anywhere is a major advantage. With cloud based ERP software, it doesn’t matter if you are at your desk in the office or on a train using your smartphone - as long as you have an internet connection, you can access the systems and data you need.

Conclusion

ERP systems help to streamline operations, provide global business intelligence and improve decision making across a business. Fundamentally, the difference between legacy on-premises software and cloud ERP is where the applications are run from - your own data centre or that of a third party provider.

But that distinction gives cloud based ERP software a number of advantages, especially for smaller businesses. Lower operational costs, technical system management included as part of the service, the flexibility to choose the applications your business really needs, mobility and easy integration with other IT platforms - cloud ERP systems offer them all.

Want to learn more? As an accredited NetSuite Solution Provider partner and Microsoft Network Member, ERP Experts works with two of the biggest names in cloud ERP solutions. Contact our friendly team of experts today and find out more about how cloud ERP can boost your business.