5 Ways Cloud ERP Can Make Your Business More Efficient


Finance Insights for ProfessionalsThe latest thought leadership for Finance pros

Thursday, December 8, 2022

Here's how cloud-based enterprise resource planning can make a real difference to your company and drive you to higher levels of efficiency and success.

Article 4 Minutes
5 Ways Cloud ERP Can Make Your Business More Efficient

Constantly raising levels of efficiency is an attractive goal to many businesses, and there are few better ways of making progress towards this objective than through the effective deployment of technology.

One of the key questions you need to ask is which tools and innovations offer the greatest potential for you. The rapid digital transformation that has occurred in every industry during the 21st century means there is more choice available than ever before.

An option many enterprises can benefit from is cloud-based enterprise resource planning (ERP). Research by Insights for Professionals has shown that more than half of companies using ERP software have opted for cloud hosting, while a quarter use a hybrid of cloud and on-premises infrastructure.

Our findings also revealed:

IFP visual showing statistics on ERP software from research

Let's take a closer look at some of the specific ways a cloud-based ERP system can help you become more efficient.

1. Easier access to data

For many modern businesses, success relies on efficient use of the valuable data available to them, and cloud-based ERP software certainly makes this goal easier to achieve. As our research showed, 67% of firms using ERP systems had gained more visibility into their data.

Cloud hosting enables much easier access to critical business and customer information, which is particularly relevant for organizations that have diverse teams of employees working in a range of locations and at different times.

If you're striving for higher levels of internal efficiency, you'll want to know that all teams are able to work with accurate, consistent data in real time.

2. Better cash flow management

Retaining a specialist vendor to host and manage your cloud ERP software means you pay for the service in regular installments. Using on-premises infrastructure, in contrast, requires you to cover a range of upfront costs, including purchasing servers and paying experts to install the hardware, build databases and get the system up and running.

The subscription-based payment model available with cloud ERP can make it easier to manage your cash flow by spreading out the cost of the service, rather than having to pay a large initial lump sum.

Furthermore, on-premises ERP systems can be subject to unexpected one-off costs for maintenance, security updates and other vital tasks. When your software is hosted in the cloud, your vendor does these jobs for you.

3. Quicker implementation

The introduction of an on-site ERP platform can be costly and time-consuming, especially if you encounter problems or there are significant changes in your goals and requirements once the process is underway.

Delays in implementation can have a big impact on your time to value and also increase the risk of downtime, which is bad news for your customers, employees and the business as a whole.

These issues are much less of a concern when using cloud-based ERP systems, since the underlying infrastructure and tools required to deliver the service are already in place, allowing you to get up and running more quickly.

4. Data security, backup and recovery

Regardless of the nature of your business and the industry you operate in, your ERP system will contain crucial and highly sensitive data that needs to be protected. Failure to do so could lead to a range of dire consequences, such as cybersecurity breaches, data loss and financial penalties for non-compliance with industry regulations.

It's in the interest of cloud providers to maintain high standards of security, since any lapses on this front will damage their reputation and lead to lost business. Your vendor should have clear procedures in place to regularly back up your data and recover from disasters.

Choosing on-premises hosting, however, means you'll have to take responsibility for these activities yourself. Adverse events such as a cyber attack, hardware failure or natural disaster could pose a major threat not only to efficiency, but to your entire business.

5. Efficient scaling

For your business to continue functioning and performing well as it grows, your ERP software must be flexible enough to meet your evolving needs.

This can be a major challenge when you use on-premises IT infrastructure. Expanding your enterprise to encompass more users and locations, for example, will require additional physical servers, which means increased costs, skills requirements and implementation time.

Cloud ERP doesn't come with any of these challenges. It provides the option to start out with limited functionality, if that's all you require, before adding new features and services once it becomes clear your business, employees and customers would benefit from them.

If you're looking for a solution that's agile and adaptable enough to support the demands of a growing organization, cloud ERP could tick all the right boxes.

Finance Insights for Professionals

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31/03/2023 Jack Oliver
What does the future of cloud ERP look like, and how might it evolve in the coming years?