What is Cloud-based ERP Software?

Enterprise resource planning (ERP) system is the key element in managing, monitoring and keeping a track of the business functions and other routines in an organisation. Many companies adopt it for an integrated approach to their business. ERP is very extensive in its applications but most of the companies use it to monitor their supply chain of operations as well as materials right from inventory control to covering the manufacturing and distribution processes. ERP is a great tool in the hands of qualified managers to take quick business decisions and correcting the things in the right time and in right perspective.

Traditionally, the ERP softwares were hosted in the company computer and were used in its own premises. These applications were purchased by the company for monitoring and managing the overall business activities in an integrated way. Generally companies entered in a maintenance contract with the ERP supplier so that the post sale maintenance of ERP system could be made on a regular basis.

With introduction of cloud based ERP system this situation is changing drastically as the ERP providers are now offering cloud based ERP system in which the company need not to purchase a dedicated ERP software but have to take on lease the internet based ERP system hosted in the suppliers cloud computing servers and spaces.

So the cost of EPR system is now reduced to the company as instead of paying one time full payment for outright purchase and then paying for yearly maintenance, they have to simply shell out the expenses for using it in the suppliers cloud area.

Business is all about cost cutting and any such opportunity will be happily availed by the business houses. Companies are moving to cloud based ERP and soon it will be a common thing. There are robust internet connections and good data speed available and there is not any problem in using the cloud based application.

As there are concerns of security in the web, it is advisable to go for the reputed companies only so that the sensitive business data is not compromised at any level. Initially the company executives may not be at ease to switch from 'in premises' application to cloud based but we have to adopt to new technological measures especially when there is a potential of cost cutting in them.