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What is Cloud ERP Software?

The use of the term “Cloud” include a broad set of applications and software deployment models. After compiling several online resources, we created a generally accepted definition of cloud computing.

Definition of Cloud Computing: Use of the Internet to access hardware, software, and other resources that are provided on-demand to perform work.

A more in-depth definition of cloud computing has been provided by the National Institute of Standards (NIST). You can download the NIST paper here. Despite this work, disputes over multi-tenant, internal clouds, and cloud infrastructure versus cloud application create conflicting opinions of cloud requirements.

ERP software that is deployed into a cloud environment becomes “Cloud ERP Software”. Most (if not all) Cloud environments are built using virtualization and load balancing technology that allows applications to be deployed across multiple servers and database resources.
 

Why Cloud Computing Matters

Cloud based ERP benefits customers by providing application scalability and reduced hardware costs. In addition, Cloud computing technology made it easier for Acumatica to deliver our ERP software as a service (SaaS) for customers who want to acquire ERP without managing hardware, software, and upgrades while reducing up-front expenses. Customers can build an internal cloud to reduce ongoing hardware costs while maintaining greater control over integration and require local access to their data server.


Web Technology is Critical to Cloud Computing

Web technology allows cloud ERP customers to utilize a browser to access their business applications.

Definition of Web-Based Software: Use of a browser (thin client) to access a software application over the Internet (or intranet) to perform work.

By using web-based software, customers receive many benefits that are not inherently part of The Cloud. By eliminating client software, customers save time and money on installation and maintenance. In addition, the web delivers access from any device on any platform without expensive and complicated VPN and remote access software. Finally, web based solutions such as Acumatica are managed from a central data store to guarantee that users can access real-time data and dashboards from anywhere. The benefits of web software are especially significant when companies have multiple locations or companies. 

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Hosted “Clouds”

When vendors place legacy software on a hosted virtual server, they claim to have a “cloud based ERP solution.” But without web-based software, customers receive very few of the benefits described here. The presence of a thick client often requires longer installation times, dispersed data, client upgrades, and complicated remote access software. When looking for cloud ERP software, make sure that it is web-based!

Cloud Conflict

Vendors and advocates have introduced terminology and requirements which have been disputed as a source of being a true cloud environment.

  • Multi-tenancy. Some vendors argue that multiple users must share the same software in order to qualify as a cloud application. SaaS companies argue that they can reduce the cost of upgrades and product updates by running this type of infrastructure. Multi-tenancy can occur at the infrastructure level, platform level, or application level. The trade off between flexibility and cost easily justifies a multi-tenant infrastructure and a multi-tenant platform. Multi-tenancy only makes sense at the application layer if the cost of software is low compared to the need for flexibility.
  • Internal clouds. A large corporation can own a server with as many servers as a cloud datacenter. In this case, it’s difficult to argue that a cloud cannot be internally hosted. However, if a company has only one server, the ability to add capacity would be limited and the NIST definition of cloud could be challenged. Between these two extremes there is a gray area where experts argue over whether an internal deployment can be considered a cloud.
  • Hosted versus cloud. Hosting is another way to outsource IT operations. As described above, hosting is only effective if the software does not contain any client components.

Other Questions?

Contact Acumatica to request a demo of our Cloud ERP Software.