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Understanding ERP: How Cloud Transforms the Value Proposition

Understanding ERP: How Cloud Transforms the Value Proposition

The Enterprise Resource Planning (ERP) revolution dates back at least to the 1960s, when manufacturers first used integrated software systems to manage raw material inventories and to reconcile balances between inventory and finished goods. Through the 1970s and 1980s, software developers added accounting and human resources function into ERP systems. Those systems exploded in the 21st Century as developers incorporated sales force automation, marketing, and ecommerce functions into ERP systems. This gave managers a global perspective of their organizations and business intelligence that improved strategic planning and enabled better projections for business growth and development.

Cloud-based systems have become the next wave in the ERP revolution. Yes, those systems are leading the transformation of business intelligence from being confined to traditional physical brick-and-mortar business operations into the virtual presences that are the hallmark of modern connected businesses. Developers like Kenandy are offering cloud ERP solutions that are flexible and scalable, enabling those solutions to grow as a business grows, and that improve business processes and intelligence for businesses of all sizes.

Among other benefits, cloud ERP systems offer the following advantages:

Cloud ERP solutions offer superior security. ERP system vendors maintain advanced user access settings on their systems that keep sensitive data and information out of the hands of hackers. Cloud ERP vendors patch security flaws as soon as they are detected, which removes the need for customers to update their own on-premise systems to improve security. Many cloud ERP system vendors also utilize security strategies such as in-stream data packet scanning to filter out malware, and multiple firewalls that are frequently updated and ungraded to respond to the most current modes of cyberattacks.

Cloud ERP software entails lower upfront capital expenditures and implementation costs. Businesses that install on-premise systems typically incur high initial capital costs and ongoing maintenance fees due to server and staffing requirements. The upfront costs of a cloud ERP system are substantially lower, which gives small- and medium-sized businesses a greater opportunity to install ERP systems to automate their business processes.

Implementation of a cloud ERP solution is usually quicker and less intricate than implementation of an on-premise system.

Internet-enabled devices have easy access to cloud ERP software. Cloud ERP systems make data and information visible to every employee, at all remote locations, almost instantaneously, with security and data protection that can be lacking in on-premise systems. As employees become more mobile and less tied to physical office locations, cloud ERP gives them the tools they need to do their jobs more efficiently and effectively. On-premise ERP systems can be configured for remote access, but remote access to a cloud ERP system can typically be accomplished with less effort and capital outlays.

Cloud ERP solutions grow with a business. On-premise systems are typically scaled for the size of the business that uses them. When the business grows, expanding an on-premise system to match that growth can be a challenge, requiring expensive hardware upgrades and new enterprise licenses. Cloud ERP avoids these issues. As a business expands, its cloud ERP software can expand with it to add new users and functionality and without losing any data or information that might otherwise be lost in a transition to a larger on-premise system.

Cloud ERP systems allow a business to focus on its core competencies. Companies that maintain their own hardware and data centers with on-premise ERP systems typically require a fully staffed information technology department to manage those centers. IT staffers spend an inordinate amount of time on mundane tasks such as reconciling data and managing upgrades. With cloud ERP, a company’s IT department can spend more time supporting a business’s revenue-generating functions.

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