Cloud ERP or Cloud Enterprise Resource Planning is simply referred to a system that is running on a service provider’s cloud platform where the organization has the ability to access the system over the internet, so all that’s needed is an internet connection and a browser.
Cloud-based ERP offers the facility access to the system and any information from customers' sales meetings to remote worksites to home offices. According to a news article posted in Forbes magazine, cloud-based system users benefited during the COVID-1, because with all the policies created and laws imposed during the pandemic, people had to stay inside houses for months and organizations who had no backup plans other than working on premises had to face great challenges.
“The lockdown and remote working necessitated by the Covid-19 pandemic were an unexpected reality check for organizations of all sizes. The restrictions imposed by the pandemic turned the world upside down, with industries like travel and hospitality going bust and many businesses experiencing survival challenges.”
Also Forbes states, that the adoption of organizations into Cloud-based solutions accelerated during the pandemic period ever before.
“Just a few months into the pandemic, Microsoft CEO Satya Nadella said that the company had seen two years of digital transformation in two months as its customers started adopting cloud solutions.”
As in many cases, cloud ERP are accessible to users on mobile devices or desktop computers, it
becomes one of the most effective systems to be implemented in an organization not only in usual days but also during unpredicted circumstances
However, it is important for an organization to understand some basic concepts associated with cloud ERP
Deployment strategy
ERP software can be deployed on-premises/on private hosted servers or purchased in an “as a service” model. Cloud ERP functionality can usually be delivered more quickly, though in both cases, companies need to set aside time for planning, data migration, customization and configuration and staff training.
Cloud-based ERP
Enterprise resource planning software that’s hosted offsite, on the ERP service provider’s servers and provided as a service, accessed through a web browser. The vendor is responsible for the application, data storage, the underlying operating system, servers, the physical data center infrastructure and installing security updates and feature upgrades
On-premises ERP
Enterprise resource planning software that’s installed locally, on a company’s computers and servers and managed by internal or contracted IT staff. The software and its supporting infrastructure are managed, stored and maintained in-house. Businesses using on-premises ERP incur additional costs for maintenance, troubleshooting, supplementary software, updates and customizations. Antivirus and security software as well as storage and server backup systems are also necessary additional costs
Hosted ERP
A company or a hosting provider manages the deployment of ERP software as well as associated infrastructure. Hosted deployment models are often utilized when businesses seek to outsource IT operations. While this setup provides some cloud benefits, it’s not a true “as a service” model.
End-to-end security
A secure and encrypted connection between a cloud-based ERP vendor and its customers.
Subscription licensing
The company pays a fixed subscription fee at specific time intervals (annually or monthly) to use the software. That fee normally includes all software maintenance and upgrades and may be charged per user or per organization.
Aggarwal, G. (2022) Council post: How the pandemic has accelerated cloud adoption, Forbes. Forbes Magazine.