Due to the impact of the pandemic, viewing a cloud-based ERP system not just as one option among many, but as a crucial measure for a company to remain competitive, has become imperative. However, not all software options marketed as "cloud" are true cloud solutions. So how can you tell the difference between a genuine solution and a fake one? You'll find out by reading this article.
Following the period of social isolation, the transformation in consumer habits became evident, with consumers adapting to new practices and incorporating them into their daily lives. Those who previously resisted making purchases of products or services only in person have had to adapt to changes in shopping formats in recent months. research conducted by Mastercard and Americas Market Intelligence (AMI) This revealed a 46% increase in the number of online purchases. This shows that the adoption of a cloud-based ERP has reached a significant level of maturity in the market.
Those who use ERP systems have already identified the advantages that the cloud model brings to their business, which is driving the migration process in companies that traditionally developed software locally to the cloud version. In this definitive guide to ERP, we will learn more about how this tool works and why investing in an ERP is fundamental to the success of your business.
What is a cloud-based ERP and how does it work?
Cloud ERP is software that centralizes all company information on a single platform. Unlike on-premise ERP systems, cloud ERP is hosted on remote servers, usually maintained by cloud service providers, helping the user improve internal company processes and integrate activities from different departments, such as inventory, finance, and sales.
Adopting a cloud-based ERP is important to face the transformations that permeate virtually all sectors of today's industry. The need for agility in business operations is becoming increasingly vital to address challenges and adapt to competition, and the cloud proves to be the infrastructure that provides this indispensable flexibility.
The tool operates through a software architecture hosted remotely on servers maintained by cloud service providers. To better understand, we share below the main steps of how cloud software works:
Internet access
Users of the system access the ERP through a web browser, using any device connected to the internet, such as computers, smartphones, or tablets.
Cloud infrastructure
The technological infrastructure, including servers, storage, and network, is maintained by the cloud service provider, eliminating the need for the company to maintain physical servers on its premises.
Data security
Cloud providers implement rigorous security measures to protect customer data, such as encryption, firewalls, and advanced security procedures to prevent unauthorized access.
Automatic updates
Software updates are performed automatically by the provider, including bug fixes, performance improvements, and new features, ensuring that the system is always up-to-date.
Remote access and mobility with Cloud ERP
Users can access the system from anywhere, which is especially useful for distributed teams or managers who need to monitor and make decisions while out of the office.
Scalability
The tool is scalable, allowing companies to increase or decrease capacity as their needs evolve, providing the flexibility to handle growth or changes in operations.
Differences between an on-premise ERP and a cloud ERP
The difference between on-premise ERP and cloud-based ERP is clear: on-premise ERP is installed directly on your company's devices and servers and managed by your internal IT team. Cloud-based ERP, also known as SaaS (Software as a Service), is provided as a subscription-based service.
In a cloud-based ERP management environment, corporate data is stored on the provider's servers and accessed via the internet, hence the term "in the cloud".
To use the tool, the company only needs a browser and internet access, as all support and management are provided by the contracted supplier. The cloud-based ERP is located on the provider's servers and can be accessed through a web browser, unlike the on-premises ERP system, which is installed internally on the company's own computers and servers.
How to identify if a cloud-based ERP is genuine or fake.
The first question is who is managing the server. Cloud providers offer cloud-focused solutions from the product presentation. They program their software to operate optimally as a fully hosted solution, cultivating skills and expertise in hosting, maintaining, and administering software across hundreds of servers, as well as implementing various levels of data redundancy in their own cloud environments.
When opting for a genuine cloud provider, it's common for all customers to access the same solution on the same cloud infrastructure, which provides continuous and immediate access to the latest product updates.
True cloud providers also offer a customization platform that allows not only adapting the tool to your infrastructure, but also ensuring that all customizations remain operational after the release of product enhancements. Thus, the manager using the tool can quickly take advantage of the latest features and avoids the need to redeploy customizations and integrations that were in place whenever a new product version is released.
Another way to identify if a cloud-based ERP system is genuine is that they generally have more robust and secure financial resources, are highly scalable, and more reliable. From the first use, the cloud provider presents itself as transparent and demonstrates longevity and scalability.
Fake "cloud-based" ERP systems, on the other hand, run on-premises; they typically do not host, manage, or maintain these cloud solutions. They transfer that responsibility to another service provider.
Why invest in a cloud-based ERP?
Having a cloud-based ERP (Enterprise Resource Planning) system can offer several advantages for managing your company. Here are some of them:
Easy implementation
Implementing ERP in the cloud is faster and simpler compared to traditional ERP systems. This agility offers enhanced flexibility and a more robust ability to respond to dynamic market changes.
All the information in one place.
One of the main benefits of ERP is that it offers superior platform integration, enabling companies to extract more significant business value from other cloud technologies. Unlike on-premise systems, where organizations often acquire and use distinct products in isolation, cloud-based ERP facilitates operational cohesion across businesses.
Cloud technology, which encompasses aspects such as customer relationship management and business analytics, is generally offered as an integrated package, including all information more efficiently and enabling more advanced analyses and reports. This gives your business more precise control over its data, since all the tools used to analyze this data are stored in a single location: the cloud.
Automatic updates
As mentioned earlier, cloud-based ERP enables continuous innovation through automated and/or scheduled software updates by the platform provider. This approach not only saves the time and effort of the tool's managers in implementing updates, but also ensures that they are always using the latest, high-quality technology, allowing the software to evolve in line with the organization.
Another significant benefit is platform consolidation. This means the software provider takes responsibility for managing security, storage, data centers, and more, allowing companies to focus their energy and attention on their core business competencies.
Reducing expenses through partnerships and other costs.
Concerns about physical infrastructure and server maintenance are transferred to the cloud provider, reducing reliance on external partners for server hosting and management, resulting in potential cost savings.
By adopting a cloud-based ERP system, it's possible to avoid upfront costs associated with acquiring local hardware and servers. Furthermore, maintenance and upgrade expenses are generally lower, as they are handled by the cloud service provider.
Efficient data management
Cloud storage capacity is scalable, allowing companies to manage large volumes of data without worrying about space constraints, which is very beneficial for businesses that handle a large volume of transactions and information.
Real-time analytics with cloud-based ERP.
Cloud-based ERP software also offers access to real-time analytics at any time of day, as it is available 24/7, enabling companies to have immediate visibility into critical information as it becomes available.
Remote access
With a cloud-based ERP, you and your team can access data and perform tasks from anywhere with an internet connection, which is especially useful for companies with distributed teams or for managers who need to monitor the business outside of work, such as at home, while commuting, or on a trip, for example.
Integration with other tools
Cloud-based software is designed to integrate with other applications and tools, making it even more efficient at exchanging data between different systems used by the company.
Scalability
Reinforcing what we said earlier, cloud-based ERPs are scalable, meaning they can easily adapt to your company's growth. If the number of users or the complexity of operations increases, the tool can be easily expanded to meet the new demands.
Safety
The system implements rigorous security protocols to protect your data and customer data, such as encryption, firewalls, and advanced cybersecurity measures. Data is often stored on geographically dispersed servers, providing redundancy and additional security.
Efficient collaboration
Cloud-based systems facilitate collaboration between teams, enabling the instant sharing of information and documents, improving efficiency and internal company communication, regardless of the physical location of employees.
Automatic backup
Most cloud services offer automatic backup of your data, so that in case of local system failures, natural disasters, or other unforeseen events, your data remains safe and can be recovered quickly.
What areas can be improved with cloud-based ERP?
Various business areas can benefit from cloud-based ERP software, as this platform is structured through modules that meet the specific demands of the organization.
Each of these modules offers the necessary tools to improve the activities of a specific corporate sector. Collectively, these modules can be integrated and operate in a coordinated manner to benefit the management of the company as a whole. Learn about the main ones:
Invoicing: responsible for simplifying the generation and storage of electronic invoices within the ERP system;
Financial: Responsible for automating transactions, ranging from accounts payable and receivable to cash flow control, bank transactions, etc.
Accounting: It generates and records financial statements, such as income statements, balance sheets, trial balances, etc.
Tax: It simplifies the declarations, calculations, and reports required by tax authorities, covering SPED, eSocial, Sintegra, and others.
Materials: Responsible for managing the company's supplies, from receiving purchased items to quality inspection, inventory management, purchase alerts, etc.
Purchasing: It automates quotes and purchase orders, integrating inventory and financial management to ensure total control and balance in the company's acquisitions;
Commercial: Organizes the entire sales flow to optimize conversions and collects internal customer information to improve the journey of new leads.
Since cloud-based enterprise management systems offer data integration across the entire company, all departments operate more synergistically and accurately, and it becomes possible to expand the variety of indicators and reports to improve team decision-making.
An Active, A pioneer in Oracle NetSuite in Brazil and the first consulting firm to sell and implement Oracle NetSuite projects in the country.We are very familiar with the challenges faced by companies of different sizes and sectors. We act as consultants for the platform in Brazil and worldwide, so that employees and managers can simplify their business and take advantage of all the benefits that the cloud-based ERP tool offers their company.
If you're still unsure which deployment model is best suited for your company, don't hesitate to contact one of our specialists! We're here to help you identify the best solution for your business. Contact us and learn more.
