ERP (Enterprise Resource Planning) is a dedicated software specifically designed for managing business processes. It can effectively integrate a company’s operations, manufacturing, supply chain, financials, reporting and even human resource actions.
For firms working in industries like manufacturing, it is critical to be aware of what’s in stock, as excessive or unnecessary levels can quickly waste funds and lower profits. This is one of the reasons why ERP software can prove invaluable for manufacturers, but selecting what type of solution to use is also an important consideration.
While traditionally, ERP systems are on-premise, installed onsite servers and company computers, now options are available where systems are deployed and managed in the cloud offering enterprises many benefits.
How does cloud-based ERP software differ from traditional ERP solutions?
Manufacturing firms considering using an ERP system to manage processes will have a wide range of options available. But first, a decision needs to be made, on whether to adopt a cloud-based ERP option or opt for an on-premise ERP solution as both will have their advantages.
The fundamental difference between a cloud ERP system and a locally based ERP option is clear. A cloud ERP sometimes referred to as Software as a Service (SaaS) is where a firm’s ERP software and data are centrally stored and managed in the cloud, by their chosen ERP vendor. Companies will be able to access their system and data through a web browser.
On-premise ERP solutions are locally installed, on the firm’s server and hardware. Instead of the vendor managing the infrastructure, this task will fall to the company’s own IT team.
Advantages of Cloud ERP
Lower set up costs
Traditional systems require a sizeable and on-going investment to buy and manage the ERP software and the servers and hardware needed to run it. SMEs without an adequate IT team will need to hire skilled staff or outsource the work, with both options coming at a cost.
Start-up costs for cloud-based ERP are far lower as firms need to implement the ERP software suited to their needs and access it via the internet. All IT infrastructure is maintained by the cloud ERP provider ensuring the ERP solution is always operating, data is secure, and upgrades are rolled-out effortlessly. Keep in mind that the on-going monthly cloud fees will include infrastructure maintenance costs.
Cloud-based ERP is designed with improved application availability due to it being web-based. It can be exceptionally agile, as it can also adapt to business requirements quickly, making automatic adjustments to provide extra resources to handle spikes and surges for maximum availability.
Cloud ERPs can deliver real-time information that can be viewed online at any time from any location. This empowers employees to access accurate and current data on a wide range of personal devices while they’re on the move.
Cloud-based ERP providers offer stringent security measures, that can help SMEs stay compliant with data protection certificates in place. Security protocols protect data from breaches while disaster recovery and dependable back-up processes ensure no data loss occurs.
As providers of both on-premise and cloud ERP at WinMan, we can offer guidance on the best ERP platform to suit the needs of your manufacturing business. For further information, get in touch with our professional team today.