The benefits of Cloud ERP

In our last blog post, we wrote about what a cloud ERP system is. In this blog post, we will focus on some of the many advantages of using a cloud ERP system. 

We will start with one of the biggest advantages of using a cloud-based ERP system - namely the costs. 

In contrast to installing an ERP system on-premises, where the company itself, is responsible for purchasing servers, creating databases, initial implementation, consultants, IT staffing, security and backup, you do not have to deal with the majority of these costs yourself when a cloud-based ERP system is used. This means that that there will be a significant reduction in costs already in the implementation phase.  

With the cloud-based ERP system, there are advantages in that a service provider will host and manage the software on own servers, while companies with on-premises ERP would have to handle these maintenance costs, such as upgrades, updates and IT-support, themselves.  

If a company were to experience growth, more server space may be needed for the ERP system, since this will require more users or more functions. With an on-premises solution, the addition of additional servers will be necessary, but as a cloud ERP user, the service provider will take care of the scale-up and server space, and the company in growth will therefore not be challengaed by lack of space, relocation or larges costs when purchasing servers.

Read more about how to get started with Odoo ERP system  

It can be difficult for some companies to trust an external service provider to keep important data and sensitive information safe. However, the security of an external service provider is often much higher than it would be if the company itself stores the data on-premises. Cloud-based ERP typically offers high security quality and encryption of data between the service provider and the costumer/company, which provides higher security and compliance with security standrads than what a company would be able to afford if they were responsible for the security themselves with an on-premises ERP. 

There is also a certainty that data is always backed up and secured with a cloud-based ERP system, since there are many planned and practical recovery procedures should the servers be exposed to cyber attacks.

Is your company missing a security check? Read about our security check here 

Should an accident happen and the server hosting the ERP system suffers a hardware failure, there would be, with an on-premises ERP, a significant cost, both in terms of time and money, to transfer data to a new storage system.  

If, on the other hand, a company works with cloud ERP, its data is spread over servers that are located in other geographical locations, which is why data can be easily accessed over the web, even if hardware errors are experienced in-house. 

When a company choose to implement an ERP system as a work tool, the time from implementation to the actual use of the system is often a significant factor. It takes time and resources to implement such a large system and then change the workflow so that the employees are ready to work with the new system. 

With a cloud-based ERP system, the implemntation phase is typically much faster than if the system is to be installed locally. This is due to the fact that with a cloud ERP you do not have to choose and set up hardware, as well as the hiring and training of employees who must be super-users of the system, so that other employees can be trained to use the system correctly and most efficiently.   

The implementation phase of an ERP system, regardless of type, will mean downtime for a company - however, the implementation of a cloud ERP will have significantly shorter downtime and thus be not as costly for the company. Typically, the implementation of a cloud ERP will also comply with the time frame for the implementation phase, since the service provider takes care of a large part of the installation phase, as well as training employees.

Learn more about VK DATA's project model that helps you safely through the implementation phase 

With a cloud-based ERP system, all users of the system have easy access to data, information and functions in real-time, regardless of the users location - all that is required is an internet connection and a browser for opening the system. This easy accessibility to the work system makes it easy for a company to make decisions or complete a task, since all employees, across the company, always have access to the same data. 

Cloud-based ERP solutions give a company a certain freedom in that the system can be scaled up and down according to the needs of users and functions. This means that new units/users can be quickly added to the system online, as the company grows. 

In addition to the need for new users, new tasks can also arise and thus also a need for new modules with new functions. Here, too, it is possible to start with basic core modules that provide access to the necessary functions for the company in question, after which it can be up-scaled with other modules and functions when the need arises. Furthermore, these new modules and functions can be added without acquiring more hardware or new servers, since the service provider takes care of all this. 

A cloud-based ERP system is super adaptable and can be adapted to the specific needs that a company may have - both from the very beginning and as the company develops.  

With an on-premises ERP, the system can also be adapted to the company, but will however be tied to the software in question and will face difficulties when re-implementing upgraded versions. These difficulties can lead to the system not being updated and the company will thus run with outdated systems and technology.  

It has been seen several times that cloud ERP systems can be integrated with other cloud-based products, where new modules can also be added to the system, without a company having to experience downtime or the purchase of additional hardware. This means that the company with this solution will be able to adapt to changes in the industry and/or consumer trends, while the company will be better protected against unforeseen circumstances. 

Finally, a cloud-based ERP system will be able to easily keep up with the latest and most up-to-date technology, since the service provider will manage system upgrades and updates on an ongoing basis. should there be updates that require downtime, this can take place outside the company's opening hours, so that it does not cost the company too many resources to upgrade the system.