ERP in the Cloud – Benefits and ChallengesMaking a choice surrounding cloud-based software? Read the benefits and challenges before deciding whats best for your business
What is ERP in the Cloud?
Cloud-based system solutions, also known as Software as a Service (SaaS) are becoming more and more common and preferable to Australian businesses. This innovative technology provides the same functionality as an on-premise ERP system, but also adds the benefit of real-time data accessible from any device, 24/7.
As with any ERP software, Cloud-based ERP comes with benefits and challenges which you should be aware of prior to making your choice. Take a moment to read about some advantages and disadvantages.
Easy Access and Greater Data Visibility
The most apparent benefit of cloud-based computing is the flexibility to access your information anywhere, anytime. If your employees are working remotely or on the road this feature will be for you. Employees are able to access data while off-site, thereby improving efficiency. Real-time information makes for better decisions and provides updates for your managers.
In order to stay on top in a competitive market, you need to satisfy customers unique needs. Making important decisions in a company sometimes needs to be done in seconds. For those working in a manufacturing business, you will understand these pressures well. Having access to real-time data will help optimize processes, manage your resources and ultimately, will enable you to make more informed decisions.
For businesses that are going through a period of growth, you need a system that is able to scale. The subscription model of Cloud ERP makes payment flexible and scalable, as you are only charged for what you use. That means you have the power to decide whether you need to increase or decrease licences, depending on current employment status. As your company grows, ERP Cloud software will adapt to your needs.
Additionally, in a cloud-based system, the software host will look after any upgrades or patches, meaning you don’t have to worry about this and have more time to focus on your business.
Pay for Use
Cloud-based service pricing is based on storage capacity and/or a per-user basis. This means you only pay for the resources you use. Generally, SaaS is designed as “easy in – Easy out” so you can adjust licence numbers up or down at short notice, after an initial lock-in period.
A critical factor of business continuity is protecting your data, and having it stored in a cloud system will ensure you have backups which are protected in a secure and safe location. Losing your data can happen following a computer crash, a power failure or any other technological crisis. With the right cloud-based system, you can rest easy that your data will always be backed up and safe.
Reduced IT Expenditure
Using the resources that are provided by Saas, you are able to reduce your operational costs such as IT management and system maintenance. Cloud-based solutions have fewer time delays, consume less energy and costly system upgrades and new hardware is usually already included in the contract. Lastly, having a system that is able to deal with IT maintenance issues means lowering operational costs that would previously be incurred with in-house systems.
With any cloud-based system, there are challenges that come with the above benefits. Challenges are best avoided by being aware and being prepared. Working in the cloud is relatively new for businesses, so when you consider moving to a cloud-based ERP, it is important to understand the risks involved.
Privacy in the Cloud
The most prominent factor that people worry about with the cloud is privacy. You do need to be aware of what is happening with the storage, movement, and visibility of your data. In order to safeguard your business against these risks, ensure you are aware of the service provider’s responsibility as well as your own.
Lack of Expertise
Any new technology comes with its challenges, and the most important challenge is a lack of expertise. Ensure that you are working with a trustworthy provider and implementation partner who can take you through the process of implementing a cloud-based solution from beginning to end. If you are not sure what to consider when choosing the right partner, read our article on “What to expect from you Enterprise partner”.
As mentioned in the benefits, cloud-based solutions allow businesses to ‘pay as you go’ which can cut costs down considerably as you can shuffle around with the numbers of licenses to meet your requirements at the time. However, the scalable nature makes it difficult to project prices and plan a strict budget accordingly. From an accounting perspective, the costs shift from Capital Expenditure to Operational Expenditure (from the Balance Sheet to the P&L). This may not suit all businesses.
When it comes to the cloud, businesses become dependent on their service providers, and especially the internet service provider. If and when your internet connection is down, or even slow, there is an immediate impact on business continuity. It is essential to have a fail-over internet connection, ideally with a different provider, as a backup. Ensure that your SaaS provider has real-time monitoring policies in place. As well as the ability to restore your data from their backups in the case of a disaster.
Is working in the Cloud for you?
In the end, you should always consider your own specific business needs first. The software must meet these needs. The method of deployment ( SaaS, Hosted or on-premise) is secondary.
Cloud-based systems are revolutionising the IT industry. For businesses growing at a rapid pace, and increasingly complex requirements, a system such as MYOB Advanced can meet the demands that come with growth. It is a fully integrated and customisable business management solution. MYOB has partnered with Amazon’s data centres in Australia to offer you the most secure, best-in-class, high-availability experience. Data is stored locally and protected using the latest technology, including Two-factor Authentication of users.
MYOB ERP Software is the number one choice for Australian Businesses according to iStart 2017 Buyers Guide, which confirms the trust Australian Business puts into the MYOB product family.
When choosing your ERP, there are important business decisions to make. It is with the right implementing partner, providing a low-risk implementation methodology that you can ensure you will reap all the benefits from your ERP software. Talk to Kilimanjaro today about which service fits your business needs best, and whether a cloud solution is right for you.