Enterprise resource planning (ERP) solutions are often used by businesses to help consolidate and organize information within an organization. ERP software was traditionally installed on company servers or other infrastructure. These on-premises solutions were able to make businesses more efficient and provide major benefits. However, they are imperfect in certain areas, such as cost, agility, and maintenance. Cloud based ERP solutions solve many of the problems that are associated with traditional on-premises solutions and provide many advantages over their counterparts on-site.
The key benefits of Cloud ERP software:
- Lower initial cost
Cloud-based ERP systems are significantly cheaper than traditional on-premises systems. Additionally, ongoing costs are often lower. The subscription costs for cloud ERP software can be reduced after deployment. This is because maintenance and support costs are typically 20% of initial license costs. These costs include hardware costs, as well as the cost to upgrade and maintain the system and IT staff. These costs can be eliminated for smaller companies that cannot afford the upfront costs of on-premises ERP, even though the technology could benefit them.
- Simplified compliance
Businesses in highly-regulated industries such as finance, healthcare, and defense must regularly update their ERP software on-site to comply with regulations. To remain compliant and avoid expensive fees and other legal consequences, companies must be able to keep up-to-date with all the latest federal, state, and international rules updates. The company must then incorporate the changes in its existing system and upgrade hardware and software as required.
Cloud ERP software providers, on the other hand, are proactive in complying with international, state, and federal provisions like HIPPA, GDPR, and GAAP. These regulations and others are already integrated into cloud ERP software. They are automatically updated to ensure businesses meet or exceed compliance requirements. Cloud ERP software often includes localization functionality, which allows companies to change between different countries' regulations to ensure compliance across all global operations.
- Increased data security
Business applications like ERP hold all confidential information of the company. It is, therefore, vital to keep it safe. Many people mistakenly believe that an on-site server is safer than a cloud-based one. However, this is completely false. Cloud based ERP solutions provide multiple layers of encryption to increase the security of your data and ensure that they are safely stored. Employees can access this through an individual account managed from the admin panel.
- Avoid the trap of ERP implementation by streamlining the deployment strategy
High-profile ERP disasters are often caused by difficulties in planning and coordinating the rollout across departments and systems. On-premises ERP deployments can be a difficult and tedious task. Each department has to deal with its own problems while the IT department tries to keep up. Implementation problems can lead to production slowdowns, increased costs, and a halt in innovation.
Cloud ERP software was created to address these issues directly. These systems are designed to create solutions that are more flexible, adaptable, and easier to use.
- Maintenance and upgrades
Businesses don't need to worry about software upgrades or maintenance because the ERP solutions company hosts and maintains the entire system infrastructure. The provider manages all the infrastructure, including the database and servers, and pushes updates to all customers. This ensures that the software is safe and compliant with all regulations. Having one vendor handle all issues can increase accountability. Cloud ERP software providers offer 24/7 support, which is a subscription-based service. This allows them to respond quickly to any problems that may arise. Cloud ERP vendors can often provide more uptime and security for their customers than in-house IT staff because their business depends on availability.
- Get access to additional business intelligence capabilities
Cloud ERPs make data storage and collection much simpler. This is crucial for data analysis. Many cloud-based ERPs have built-in analytics features that can be powered by real-time information. This allows your team to spot changes in business conditions, evaluate possible strategies, improve business performance, and make data-driven business decisions that reduce risk, cut costs, and increase revenue.
Contrary to cloud ERPs, on-premise ERP software is more susceptible to compatibility issues and may have data silos. Cloud ERPs can easily be integrated with third-party business intelligence software if you need specific capabilities.
How can cloud ERP systems help small businesses?
We explained above that cloud ERP is a great option for small businesses because it is easy to use.
Although ERP systems have the same benefits regardless of the size of the company, cloud ERP systems can be more cost-effective and easy to use for small businesses.
Cloud ERP solutions are a great alternative to on-premise solutions that can be expensive and difficult to implement.
Small businesses may not have the resources to support on-premise software. Cloud ERP software providers can be an extension of your staff, handling updates, maintenance, monitoring, and other tasks for you.
This allows you to focus on the software and your business rather than worrying about how it runs.
- Better agility for your business
A growing business needs agility. Companies must be able and willing to take advantage of opportunities such as new locations, new products, services, acquisitions, and responding to market changes. Cloud ERP systems allow companies to expand their business by providing instant access to data from all departments.
- Cash flow visibility in the cloud
Any growing company needs cash flow to survive. Cloud ERP software integrates accounting processes with business operations to increase information availability, such as working capital, operating costs, and investments. This ensures that every aspect of the company is accurately accounted for, which ultimately leads to growth.
- Seamless integration in the cloud
To keep up with consumers and market demands, small businesses must adapt frequently. Cloud-based ERP solutions like Dynamics 365 Business Central simplify the integration of new software, processes, and solutions. This helps with frequent adjustments.
Are you ready to make the switch to a cloud ERP? Advaiya can help.
Cloud migration brings better best-practice data, new technological capabilities, and a safer ERP system. Many businesses find that their on-premise ERP solutions cannot keep up in a digital-driven market. Advaiya is a digital transformation solutions company, and a Microsoft solutions partner with extensive experience in business management solutions based on highly versatile Dynamics 365 and Power Platform.
Have questions about cloud ERP migrations or the business benefits of Cloud ERPs for your organization? Contact us to schedule a consultation today.
Kirti is an Associate Principal at Advaiya and is a technology enthusiast specialized in business applications and analytics. She has been an integral part of Advaiya for over seven years, contributing to myriad deliverables involving business intelligence, technology marketing, and business consulting.
Posted by Advaiya
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