What is ERP software?
Enterprise Resource Planning software, more often referred to simply as ERP software, is a business software solution implemented by ERP consulting companies to:
- Improve the efficiency of operations
- Boost employee productivity
- Perform in-depth analysis of company data
ERP software is able to provide its benefits primarily by centralizing company data into a single computer database. By doing so, ERP software is able to process company data as a whole rather than in fragments spread across different departments.
Why Companies Should Implement a Cloud ERP Software Solution
ERP software solutions generally are developed to be either:
- Hosted on premises on company-owned computer servers
- Hosted in the Cloud on servers owned by a Cloud hosting provider
For virtually all companies, regardless of the industry in which the company does business, a modern, Cloud-based ERP software solution is preferable to traditional, on-premises ERP software.
Here are a few benefits that Cloud-based ERP software offers compared to on-premises ERP software:
Lower upfront costs
With Cloud-based ERP software solutions, companies do not have to make a significant upfront investment in expensive IT hardware. The IT hardware needed to run the ERP software is owned and maintained by the Cloud hosting provider.
With ERP software developed to be run on-premises, companies need to invest in enterprise-grade servers and other IT hardware, including networking equipment and storage solutions. Further, there is the ongoing expense of maintaining this hardware.
Cloud-based ERP software solutions are built from the ground up to be accessible over the Internet. They are hosted in the Cloud, which means the ERP software can be used from anywhere in the world where an Internet connection is available.
Traditional, on-premises ERP solutions are not designed to be used over the Internet. As a result, to make the ERP software available to employees working remotely, companies must implement cumbersome technologies such as virtual private networks (VPNs).
Easily scalable resources
In the contemporary business world, demand can change rapidly. Companies using ERP software need to be able to scale resources easily and quickly in response to changes in demand.
Computing resources for Cloud-based ERP software can be scaled up or down with just a few mouse clicks or keystrokes. For example, additional data storage space can be added instantly when existing storage space is running low.
With on-premises ERP software, to scale up resources, additional IT hardware must be purchased. If additional data storage space is needed, hard disk drives (HDDs) or other storage devices will need to be purchased, installed, and configured.
Challenges of Cloud ERP Implementation
Although there are plenty of benefits of transitioning to the cloud there are few challenges of cloud ERP implementation that you should be aware of.
Maintaining multiple systems is difficult
With more systems to maintain, system management becomes more complex and difficult to manage. Although cloud ERP solutions are often managed by the vendor itself, your team must be able to effectively manage the environment. Choosing a cloud ERP solution that has a single source of truth can make this easier for both parties.
Brand new system
Similar to most new tools and resources that your company
uses, it will take time for your team to get acclimated to a brand new cloud ERP solution. In order to get the most out of a cloud ERP software, your team will have to spend time learning the new system and share knowledge with one another.
For the most part the cloud is easy to learn, it simply takes time to learn how to navigate through the new system and infrastructure in order for your company to get the most out of their cloud ERP software.
One of the biggest concerns for companies implementing a cloud ERP software is their data security. Most companies assume that since their data is in the cloud there is a greater risk of data loss or breaches. However, this is not the case. Cloud services offer greater security protection than that of on-premise software. It can be scary to transition all of your data to the cloud but with a reliable cloud service provider, you can implement a new cloud software safely.
Tips for Cloud ERP Software Implementation
Companies looking to get started with a Cloud-based ERP software solution are wise to follow these tips:
Carefully develop a Cloud ERP software implementation plan
Like with any other important business project, a comprehensive plan should be developed before the ERP software implementation process begins.
While there does not exist a single correct way to develop an ERP software implementation plan, most ERP software implementation plans will include the following phases:
- Discovery, to understand the goals of implementing ERP software.
- Planning, to determine what tasks need to be completed in order for the goals of implementing ERP software to be achieved.
- Development, to tailor the ERP software and processes specifically for the company implementing the ERP software.
- Testing, to work the bugs out of the ERP software solution configuration.
- Deployment, to put the ERP software into active daily use by company employees.
- Support, to make sure employees are able to take advantage of all of the benefits that ERP software has to offer.
Form a capable team
Cloud ERP software implementation is best handled by a dedicated team. This team should take full ownership of the responsibility to make sure the cloud ERP software implementation plan is properly and fully executed.
Your cloud ERP software implementation team should include employees who will be using the ERP software on a daily basis. These employees know best what is needed out of the ERP software solution and what functionalities in the ERP software would be beneficial.
Establish realistic time frames
When implementing cloud ERP software, it is important that milestones, and time frames for achieving the milestones, be established between companies and ERP consulting companies. These milestones and time frames must be realistic.
One common reason why companies experience trouble when implementing cloud ERP software solutions is because “feature creep” sets in, that is, features keep being developed and added, resulting in the project never being completed.
Training Users to Work in the Cloud
Cloud-based ERP software solutions can significantly transform business operations. Ultimately, these transformations will result in higher efficiency and productivity. But, it can take employees a while to get familiar with an ERP software solution.
Once cloud ERP software is up and running employees will need training or orientation to get comfortable using the cloud. This is a crucial step of implementing cloud ERP software. Cloud ERP software offers plenty of benefits to scale your business but won’t help you if your team does not know how to use it.
You want to get the most out of your cloud ERP software that’s why it’s important to take the time to properly train your team on the best cloud practices and the industry specific features cloud ERP has to offer.
Establish a Data Migration Strategy with ERP Consulting Companies
Migrating your data from on-premise to the cloud can be difficult. In order to successfully transition from on-premise to the cloud you will need a data migration strategy tailored to your organization. Quality ERP consulting companies are experienced in helping with this strategy.
Designating data owners can ensure that any data moved from one storage location to another is clean and free of inaccuracies or duplicates.
The key to a data migration is to have the necessary steps in place to ensure that the data migration is complete, accurate, and valid.
Transitioning to the Cloud? Work with an Expert
ERP software implementation experts can help to ensure that an ERP software implementation goes as smoothly as possible.
Experts at implementing ERP software, such as S-Metric, have the experience needed to successfully guide companies through all phases of an ERP software implementation plan.
To learn more about the ERP implementation process and how to make the transition easier for your organization, contact an expert today.