Why Are Manufacturers Switching to Cloud ERP?

Why Are Manufacturers Switching to Cloud ERP?

Is Cloud ERP a bunch of hype? Can it help to evolve and strengthen core business functionalities?

Cloud-based ERP is hosted on a cloud computing platform and managed by the vendor. Backup and disaster recovery plans are available to ensure work is not interrupted. For small and mid-sized businesses, cloud ERP is a great option.

“With a cloud-based solution, we only need to spend for the resources we need, as we need them.”

– Senior Vice President and CFO, Northeastern Hospital

Be it a hospital, manufacturing, educational, medical, or retail business, cloud ERP smoothly manages business operations for greater time savings and productivity.

The major benefits of cloud-based manufacturing ERP are highlighted below:

Benefits of Cloud-based Manufacturing ERP

When you choose a cloud-based implementation plan, the ERP system is distributed from the cloud server (which is maintained by the cloud provider) and accessed on web browsers by users. Cloud ERP lowers the expenses, encourages quicker implementation, decreases capital expenditures, and allows businesses to focus on core functionalities.

A fully integrated Enterprise Resource Planning solution connects your entire business and offers an unmatched user experience. It streamlines operations, reforms the supply chain, and maintains significant security standards that are a must for a successful manufacturing business. And when it is on the cloud, the benefits increase significantly. Here’s how:

  • Cloud ERP encourages the use of virtual machines, freeing your IT team to focus more on growth initiatives rather than day-to-day, mundane tasks.
  • Easy-to-use setup wizards ensure quick and less complicated implementations.
  • Day-to-day operations such as order management, replenishment, cash collections, etc. are automated and visible.
  • It scales up and down, with your business.

When it comes to selecting a new enterprise resource planning (ERP) system, one of the most critical aspects of your decision will be how you choose to deploy it. Cloud-based manufacturing ERP systems are more common today than ever before. Nearly every ERP vendor offers some form of cloud deployment option, and some have discarded their on-premise offerings altogether.

The image below gives a glimpse of cloud ERP vs. on-premise ERP and shows some differences between the two.Cloud ERP vs On-Premise ERP

The difference between On-Premise and On-Cloud ERP is an on-premise solution is installed locally on hardware and the company’s servers. Cloud ERP is hosted remotely by the vendor and can be accessed by users through a web browser. This means, irrespective of the location and time, users are free to work all they need to have is a good internet connection.

So, why is cloud-based Manufacturing ERP taking over on-premise manufacturing ERP?
Let’s see how cloud is better than on-premise ERP:

  • Better affordability – no additional expense on IT infrastructure
  • Anytime, anywhere access from any device
  • Quick deployment speed
  • Timely software upgrades
  • Rigorous security and backup procedures
  • Seamless and automatic updates

Industry-leading manufacturers are defined by their collaboration, on-time deliveries, and decision-making. Small and mid-sized business owners are turning to cloud ERP as a new path towards innovation and success.

It’s no secret that technology evolves at a rapid pace. Businesses should have the skills to leverage these technologies to stay competitive in this modern world. IoT (Internet of Things), Blockchain, Big Data, Robotics, and Cloud computing are some of the technologies that cloud ERP utilizes for better productivity and real-time accuracy.

Cloud lays a foundation for these evolving technologies. According to SAP benchmarking, organizations that work on the cloud, witness a 49% increased operating margin. Cloud-based platforms provide consistency which helps to ensure greater flexibility and better performance. According to SAP, discrete manufacturers use the cloud to:

Simplify processes
Businesses are more successful when they are less complicated and follow an easy way of conducting tasks. With cloud ERP, your employees don’t need physical devices like hard disk drives and memory cards for their systems because every piece of data is saved online, they can access it from any device through a web browser. Uploading, viewing, and editing the files becomes simple.

Differentiate core business processes
Mass-produced goods are different from goods that are manufactured per customers’ specifications. This highly competitive market is dedicated to meeting customers’ demands and has to have good systems in place to maintain a competitive edge. A cloud-based platform allows discrete manufacturers to be efficient and effective with a simple and systematic approach.

Modernize your business
Whether it is financial management or inventory, supply chain, or collaboration, cloud ERP lets you manage every aspect of the business in a hassle-free manner. Cloud-based ERP solutions are robust, eliminate IT expenses, and let you easily meet security compliance needs. It encourages innovation, quick decision-making, and unified data into a single database.

There are still some organizations where employees use multiple tools and applications for different tasks. Cloud ERP allows businesses to manage their HR, CRM, financials, production, quality control, and resources from a single platform without chaos from disparate spreadsheets.

A cloud ERP solution such as OptiProERP provides you with all the comprehensive business management tools to improve insight and streamline processes. With world-class security delivered by SAP Business One, OptiProERP is a system of innovation that scales quickly and offers real-time data access to users. To learn more about its functionality, feel free to contact us.