ERP systems and Cloud Computing
Some ERP vendors, for both the Corporate and SME/SMB sectors, are embracing the benefits of cloud computing i.e. applications hosted online. There are various manifestations of this in the ERP space, including Software plus Services (S+S) and Software as a Service (SaaS).
S+S combines the proven benefits of locally installed applications, such as accounting and HR, with online tools and services, such as online dashboards, time registration and CRM for field staff. This gives organisations more flexibility in the way they run their business.
SaaS is a service that enables people and companies to use and pay for software on demand or for the amount of time used. This means that rather than the software being on, for example, a persons’ PC or a company’s server, they can access the application via the Internet and pay for what they use or as they use it, rather than having to pay ‘up front’ for the software.
There are a number of advantages for employing these types of models:
- Accessibility. Having the ERP system or parts of it, web-based means users can access it via the internet anytime, anywhere. This gives management and field staff access to the critical information they need, whenever and wherever they need it.
- Security. With Software plus Services, modules which are sensitive or do not typically need to be accessed while on the road, such as accounting/financials and HR, are still held on the organisation’s servers, as with most traditional systems. Only certain modules and information are accessible via the web, depending on the organisation’s preferences.
- Cost reduction. Because of the business model used with Cloud Computing it is possible to pay only for services used or as they are needed.
- No or reduced Capital Expenditure (CAPEX). By renting or paying on demand for software and other services, it means that an organisation will not have to pay ‘up front’ for software licences and infrastructure needed to run the system. The charges can be made on a ‘per usage’ model or an agreed monthly charge. (Flat monthly fee).
- Scalability. Using the cloud model means that companies can scale up or down projects as they can use only the services required for a period of time.
- Budgeting. This allows for predictable IT expenditure. If a pre-agreed price has been set, then it’s easier to stick within pre agreed budgets.