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What is Cloud-Based ERP Software & How Does It Work?

Cloud-based ERP software is the future of business. Its flexibility, scalability, and mobility make it easy to implement.

What is Cloud-Based ERP Software & How Does It Work?

It can be used by both startups and large companies with nationwide operations. And the best part is that it is more than just a buzzword and is here to stay.

What Is Cloud-Based ERP?

Cloud-based enterprise resource planning (ERP) software is an integrated and comprehensive application used for managing all data and business activities within a firm.

It takes your payroll, accounting, order management, customer service, and anything else you could think of and rolls it into one program.

What this means for you is, at the end of the day, there is no need for you to open up multiple windows or shared folders on your computer just so different departments can work in sync.

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Since all your data is accessible on different devices including desktop computers, laptops, tablets, and mobile phones, anybody can work from anywhere. That’s why even small businesses are taking advantage of this technology.

Cloud-based ERP simplifies IT structure with great flexibility and user-friendliness.

And as opposed to software solutions that are installed on the customer’s server, cloud software is actually run by software-as-a-service (SaaS) providers, eliminating the need to maintain equipment or other infrastructure altogether.

What Is the Difference Between Erp and Cloud Computing?

Cloud computing is revolutionizing the way information technology is deployed and used.

Cloud computing can be defined as a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (ex. networks, servers, storage, applications, and services).

It can be rapidly planned and released with minimal management effort and service provider interaction.

The features of a cloud ERP are the same as an on-premise ERP with the key difference being how it is hosted. While traditional software is installed on-site at an organization, cloud-based ERP works using services provided by data centers that require no installation.

How Do ERP Systems Work?

ERP is generally set up to help businesses optimize production, ensure quality standards, track workflows, and even better control the finances.

And the best way to understand cloud ERP implementation is through an e-commerce store’s supply chain.

Let’s say you run an online store with a wide network of vendors. An ERP system can offer a centralized data repository to everyone in your supply chain, which they can access from anywhere.

It will allow them to monitor orders easily and make sure that they are delivered on time. The data available on the system will also be able to identify bottlenecks in the system.

For instance, you can track shipments via GPS (geo-location) so that you know what’s wrong if a delivery is late.

Simply put, an ERP system allows you to run your business like a well-oiled machine at all times.

Organizations might integrate email archiving with their ERP systems to streamline information access. For example, an ERP system can access archived email communications related to specific transactions or customer interactions, providing a comprehensive view of a customer’s history.

What Are the Benefits of Cloud ERP?

Efficiency, accuracy, security, flexibility, portability, and functionality are some of the aspects that make cloud ERP implementation a worthwhile business investment. Let’s dive deeper into the basic benefits of cloud ERP.

Get More Organized

ERP is a business system that integrates all of your organization’s business processes.

You can store and organize all the information related to your organization in a central database and carry out sales orders, financial transactions, inventory management, production planning, quality control, human resources, and customer service using one system.

No Bill Shocks

Cloud ERP is an elastic, multi-user cloud-based application. And it is ideal for any size of business as it allows you to determine a monthly fee beforehand. You always know how much you need to pay, so you can always predict your expenses.

Highly Scalable

One of the major reasons why cloud-based ERP for small businesses works is because it is scalable, which enables firms to adapt to change and eliminates the high costs of setting up data centers.

As your business grows, you can simply upgrade, add staff, and increase the bandwidth of your functions by choosing a higher plan with your existing provider.

Reduce Cyber Threats

Cloud ERP solutions are fully decentralized, so data is not stored in a single location that hackers can try to hack. Your data is diversified and isn’t stored locally, preventing unauthorized people from meddling with your company’s servers and stealing your data.

Zero Maintenance Costs

Cloud-based ERP software allows you to focus more on your core business because your cloud provider is responsible for managing the IT aspect of your operations. From maintenance to recovery, everything is performed by your service provider.

Highly Secure

Cloud ERP software is hosted in a data center with high levels of security, including 24/7 video surveillance, biometric access authorization, and a physical security system. All of which may not be affordable by businesses. So, it is always a wiser financial decision to outsource your ERP system.

Latest Technology

Cloud ERP also means your business is always equipped with the latest tools and programs – so you are always working with the most up-to-date and reliable technology available to you. You also don’t have to spend either time or money upgrading or maintaining your IT systems on your own.

Improve Collaboration and Productivity

With an ERP system, employees can work together to monitor and analyze important business metrics, helping key stakeholders make informed decisions quickly.

ERP allows you to introduce automation in your systems. By reducing repetitive and time-consuming tasks, ERP systems can optimize your employees’ time and significantly boost employee productivity.


Cloud ERP systems are designed with a focus on disaster recovery. They seamlessly integrate all the aspects of IT infrastructure for a business set-up in just one location or several locations, based on your requirements.

So, even if an entire department goes offline unexpectedly, you won’t be facing hefty losses, as your cloud ERP system will continue to work from remote offices.


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