What is Cloud ERP?

Q: How does the cost of Cloud ERP compare to traditional systems?

Traditional ERPs often require heavy initial capital investments and ongoing maintenance fees. Cloud ERP typically uses a subscription-based (SaaS) model, which lowers entry costs and shifts spending to more manageable operational expenses.

Cloud ERP is an enterprise business application that is hosted on remote servers and accessed over the internet with a web browser.

Cloud ERP at a glance:

Flexible, scalable, and easy to support and maintain
Low upfront, all-inclusive price (SaaS license)
Reduced IT complexity (Managed Services)
Quick response to market changes with less IT concerns

10 Reasons to Move to Cloud ERP

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Cloud ERP is online business software that replaces on-premise systems. It reduces upfront costs, scales easily as businesses grow, and supports modern SaaS models such as multi-tenant and single-tenant deployments.

What are the Cloud ERP Deployment Models?

Multi Tenant (MT) SaaS - Public Cloud

A ‘true’ cloud ERP is deployed in a model called, Multi-TenantT SaaS. MT SaaS is a subscription-based service where all businesses share a similar IT infrastructure (i.e. Amazon Web Services), a similar functional ERP application (i.e. Micro-Vertical Industry Specialized) and a similar, Managed IT Service (i.e. Automated upgrades, maintenance and focused support).

The ERP Vendor gains Economies of Scale with MT SaaS. ERP is easier to develop, support and maintain when these similarities are shared across like businesses. The larger the MT community, the more efficiency and cost savings that can be shared.

Each individual company's data in MT SaaS is encrypted, secured and complies with industry-standard regulations of their Micro-Vertical industry (i.e. ISO, AS9100, 21CFRPart11).

What are the strengths of Multi-Tenant Public Cloud?

Economies of Scale,
Ease of maintenance,
Low and all-inclusive upfront price,
Automated, fast Upgrades and technical updates,
Extensibility of Vendor platform.

Keep in mind:

Less customizable (source code modification is forbidden in MT SaaS),
May lack certain, unique Regulatory Compliance needs (i.e. certain DoD Contractor’s),
Extensibility requires learning new methods and tools if custom capabilities and/or 3rd party app integrations are required.

Single Tenant (ST) SaaS - Private Cloud

The main difference between ST SaaS and MT SaaS is how the ERP is shared. With ST you own the version of the ERP software, and is dedicated to your organization only. Essentially, the businesses’ data is stored on private servers running its own instance.

The main benefits of Economies of Scale, for both the ERP Vendor and ERP consumer, are broken with Private Cloud.

Strengths: More customizable (source code modification is allowed in ST SaaS), internal security controls can be higher, more flexible to upgrade or not.
Keep in mind: Higher cost to maintain, higher SaaS fee price, no economies of scale.

Public Cloud

This refers to cloud services owned and operated by a contracted service provider. Each organization's data and applications are kept secure and separated from other companies.

Strength: It offers excellent scalability and cost efficiency due to shared resources and a pay-as-you-go model.
Keep in mind: Higher cost up front as you ‘own’ the software.

Private Cloud

A private cloud is a dedicated cloud environment that is exclusively used by your organization, and computing resources are not shared with others.

Strength: It provides greater control over security and customization, as the infrastructure is tailored to the organization’s specific requirements.
Keep in mind: The investment and operational costs tend to be higher (as again you own the software).

Hybrid ERP

Combines on-premises ERP software with cloud-based services——for computing, storage, and other functionalities. Some say this merging of environments can be the best of both worlds.

Strength: Offers flexibility by optimizing and balancing workloads between on-premises and cloud environments according to needs.
Keep in mind: Managing and integrating the different systems can be complex, potentially leading to increased IT overhead and integration challenges.

How Cloud ERP Benefits Your Business?

Implementing Cloud ERP offers a wide array of benefits that can transform the way a business operates:

Efficient Business System

Cloud ERP brings everything under one ‘roof’ (central hub). Routine tasks are automated, departments work more closely together, and everyone—from finance teams to inventory managers—have real-time access to vital information, any where, anytime.

Keep in mind: Integration with existing legacy systems and machines may require careful planning and phased implementation.

Flexibility for Growth

One of the biggest perks of Cloud ERP is scalability. As your business expands, the system adjusts to your growing needs without major overhauls to your IT infrastructure.

Keep in mind: Ensure that the chosen solution can handle both current and future needs, particularly when integrating emerging technologies like AI or machine learning.

Predictable Cost

Traditional ERP systems often require a hefty initial investment and ongoing maintenance fees. On the other hand, Cloud ERP usually operates under a subscription model. This lowers the entry costs and also shifts costs from capital expenditure to more manageable operational expenses—an attractive option especially for small and medium-sized businesses.

Keep in mind: Evaluate the TCO carefully, accounting for hidden costs such as customization, integration, training, and potential downtime during migration.

More Efficient Customer Service

When all departments are working from the ‘same song sheet”, customer service naturally improves. With information at their fingertips, support teams can resolve issues faster and more efficiently, leading to happier, more loyal customers.

Keep in mind: Integrated customer relationship management (CRM) systems will maximize service improvements.

Bringing Everything Together

Cloud ERP isn’t just about managing finances or inventory—it’s about connecting all business departments into one seamless system.

Keep in mind: Implementing a Cloud ERP system can bring organizational challenges, such as resistance to change. During the implementation process, it’s crucial to ensure that all departments are well-informed about the new system, its capabilities, and the benefits it can bring. This proactive communication helps facilitate smoother adoption and minimizes pushback.

Enhanced Cybersecurity

Robust Security Standards: Cloud providers (like AWS) can afford the very best security measures.
Disaster Recovery: Minimized downtime with built-in disaster recovery.
Automatic Backups: Reduce your daily maintenance.

Keep in mind: Verify that your cloud provider adheres to industry-specific compliance standards (e.g., GDPR, HIPAA) and includes advanced security protocols such as multi-factor authentication and identity management.

Transition from Legacy Systems to Cloud ERP

Data Migration

Ensure your current data is clean and ready to be electronically transferred.

(BPR) Business Process Reengineering

More than just training (and more than memorizing keystrokes), realign business processes to best practices, streamlining efficiency, supporting effective change management, and positioning your organization for future growth and innovation.

Ensure you get the results you expect when you go live.

Security and Compliance

Ensure your cloud provider follows strict security protocols and complies with industry standards to keep your information safe.

User Training

Invest in training to ensure your team is comfortable with the new system—after all, a great tool is only as good as its users.

Meet with Infor CloudSuite Industrial

Infor CloudSuite (Syteline) is a powerful Cloud ERP solution designed specifically for SMB manufacturers, project management teams, and field service organizations. Many customers replace multiple separate data silos with this integrated, end-to-end ERP system that streamlines operations and manages all aspects of their business.

Learn More

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Frequently Asked Questions About Cloud ERP

What is Cloud ERP?

Cloud ERP is an enterprise business application hosted on remote servers and accessed over the internet through a web browser. It is designed to be flexible, scalable, and easy to maintain, allowing businesses to adjust to market changes without the burden of legacy hardware costs.

How does the cost of Cloud ERP compare to on-premise systems?

On-Premise ERPs often require heavy initial capital investments and ongoing maintenance fees. Cloud ERP typically uses a subscription-based (SaaS) model, which lowers entry costs and shifts spending to more manageable operational expenses.

What is Multi-Tenant (MT) SaaS?

Often called "true" cloud, Multi-Tenant SaaS is a model where multiple businesses share the same IT infrastructure and functional application. This allows the vendor to achieve economies of scale, resulting in shared cost savings and more efficient automated updates.

What is Single Tenant SaaS?

In a Single-Tenant model, your organization owns its specific version of the ERP software, which runs on dedicated private servers. This offers more control over security and the ability to modify source code, though it lacks the economies of scale found in multi-tenant environments.

Is Cloud ERP secure?

Yes, cloud providers like AWS utilize robust security measures that many individual companies could not afford on their own. Benefits include automatic backups, built-in disaster recovery, and data encryption that complies with industry standards like ISO or AS9100.

Can I customize my Cloud ERP system?

Customization levels depend on the deployment model. Single-Tenant SaaS allows for source code modification. In Multi-Tenant SaaS, source code modification is forbidden to maintain system uniformity, so extensibility is achieved through specific vendor platforms and third-party app integrations.

What is a Hybrid ERP?

A Hybrid ERP environment combines on-premises software with cloud-based services for specific tasks like storage or computing. This offers flexibility in balancing workloads but can increase IT complexity due to the need to integrate different systems.

What is the biggest challenges when transitioning to the Cloud?

Key considerations include data migration (ensuring data is clean before transfer), integrating with legacy systems, and managing organizational resistance to change. Proactive communication is essential to ensure smooth adoption across departments.

What is Business Process Reengineering (BPR)?

BPR is the process of realigning your business operations to industry best practices rather than just learning how to use new software. It aims to streamline efficiency and position the organization for future innovation.

How does Cloud ERP support business growth?

One of the primary benefits is scalability. As a business expands, the system can adjust to growing needs without requiring major overhauls of the existing IT infrastructure.

What is Cloud ERP?

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