An Introduction to Cloud ERP
According to WhatIs.com, Cloud ERP is an approach to enterprise resource planning (ERP) that makes use of cloud computing platforms and services to provide a business with more flexible business process transformation.
At Acumatica, we like to think of Cloud ERP and Cloud Accounting Software as tools that help small and medium businesses unlock their business potential and our suite of business software is written specifically with that goal in mind.
For many businesses the biggest investments they make are in human resources, inventory and fixed assets and managing those resources are what ERP is all about.
Empowering your people, taking control of your business and playing to your strengths are the core areas where the Acumatica Cloud ERP suite of business applications can help your organization grow profitably by allowing your people to work anywhere, anytime on any device via our web browser based accounting, inventory management and financial management applications.
Whether you choose to use Apple iPad, iPhone or Google Android platforms – Windows, Mac or Linux desktop platforms, a Cloud ERP solution such as Acumatica can run on any or all of these- giving you the power of choice and allowing your business and your people to take advantage of BYOD (Bring Your Own Device) initiatives whilst keeping your data secure and protecting the privacy of your data and your customers data.
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 through a software as a service (SaaS) model for customers who want to acquire cloud ERP and not have to manage 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.
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!
The tables below summarize some of the key benefits.
The Conflict in the Cloud
Vendors and advocates have introduced terminology and requirements which have been disputed as a source of being a true cloud environment.
- Multi-tenancy- Some cloud ERP 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 the 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
A Pure Definition of Cloud ERP
Cloud ERP is Enterprise Resource Planning software that is hosted in a platform over the Internet.
The use of the term “Cloud” includes a broad set of applications and software deployment models, namely Software-as-a-Service or SaaS.
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 in order to perform work and other business processes.
A more in-depth definition of cloud computing has been provided by the National Institute of Standards (NIST). Despite this work, disputes over multi-tenant, internal clouds, and cloud infrastructure versus cloud application create conflicting opinions of cloud requirements.
The bottom line is that ERP software that is deployed in 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.
The Benefits of Cloud ERP
Cloud ERP is designed to address the inflexibility of existing ERP software by allowing businesses to choose the deployment option that fits their specific needs.
More importantly however is that Cloud ERP is a flexible and cost-effective option for small and medium-sized businesses and offers extensive benefits for growth and expansion:
- Freedom to scale and grow: Lowers businesses’ total costs and flat-fee prices
- Freedom from IT constraints: Offers high-level security and privacy, easy accessibility and integration
- Freedom from lock-in: With your data in the cloud, you can move it at any time
- Freedom to innovate: Offers continuous new features and functions