Cloud Based ERP Software – Working and Components

March 17, 2023 Cloud Based ERP Software – Working and Components By admin

Cloud Based ERP Software – Definition, Working, Components, Benefits, and FAQ

If you’re keen on having an ERP implementation for your small business and have been reading online about the available ERP solutions, you would’ve already come across this term – Cloud Based ERP software.

These terms can often sound like jargon and make you feel confused. Worry not as we are going to share all information with you here in an easy-to-understand way and make it extremely simple for you.

In this blog, we’ll not only talk about the working, components, and benefits of cloud based ERP software but will also look at the cost of implementation and compare it to available CRM solutions as well.

If you are a small business based out of India and are looking for the best cloud based ERP software in India, stay with us till the very end to learn more about our top recommendation. Happy Reading!

Let’s Define – Cloud Based ERP Software

Cloud based ERP software tool is an Enterprise Resource Planning (ERP) solution that is hosted on cloud servers and can be accessed from anywhere through the internet.

Since cloud based customised ERP software solutions are hosted on the cloud servers of the vendor, there is no need to install any software or applications on the client side or end-user machines.

In this type of ERP setup, the vendor is solely responsible for running the ERP application round-the-clock. They take care of everything from data storage, application maintenance, and feature upgrades to data security, ease-of-accessibility, and overall up-time of the ERP tool.

Cloud based ERP software is a form of SaaS (Software As A Service) and is usually available to small businesses on a subscription model. You can either choose to pay monthly or annually. In some cases, the pricing also depends upon the number of team members or end-users.

As compared to other types of ERP solutions namely on-premise and hybrid where you’ve to invest in infrastructure to host your business data and ERP application, cloud based ERP software is an affordable and hassle-free way to implement ERP and enjoy all benefits for your small business.

In this modern era of technology, if you need a competitive edge and want to drive your business to grow, you need solutions that are robust, seamless to work with, and accessible around the globe. This is exactly why cloud based ERP software has become the need of the hour.

Let’s Understand – Working of Cloud Based ERP Software

If you are a small business and you decide to go for the implementation of cloud based ERP software, you can speak with multiple vendors and decide upon the ERP software that matches your requirements and fits your budget.

You can choose the cloud based ERP software in India that has pre-built specific modules for your requirements. You can also check with the vendor if they can personalize the modules to make changes to the ERP as per your requirement and deliver a cloud based customised ERP software.

The ERP implementation will ensure your most repetitive daily tasks are automated and the company resources are utilized for more creative tasks thus leading to an overall increase in operational efficiency.

Since this is a cloud solution, no hardware or software will be installed on-premise. You can sit back and relax while the vendor will set up the ERP implementation and shares access details along with login credentials.

This is not a time taking process, based on your customization requests and the time to transfer data, your set up will be completed from anywhere between a few days to a few weeks and you will start enjoying the benefits of cloud based ERP software in no time.

Remember to keep aside sufficient time to train your team members and employees to use the new tool so that they can get used to working with it efficiently. It might take some time but is definitely worth the effort.

After the successful ERP implementation, your employees from all departments will be able to work remotely and use the cloud based ERP software from their laptops, phones, tablets, and desktop systems.

They will be able to collaborate on different tasks and share business data with absolute ease. This will ensure a smooth functioning and timely completion of your business tasks.

Also Read: Cloud-Based ERP Software: How it Works | How Cloud-Based ERP Software Works

Top 10 Benefits of Cloud Based ERP Software

There is a huge list of advantages of using cloud based ERP software for small businesses, let’s have a look at the top 10 benefits here:

  1. Global Access – Since the cloud based customized ERP software is hosted on cloud servers, you can access it from anywhere around the globe, all you need is an internet connection.
  2. Quick Implementation – As these are pre-built software solutions and there is no need for you to make any provisions on your company site, it is fairly quick to set up a cloud based ERP software.
  3. Fast and Efficient – Cloud servers are known to be faster. The speed of fetching data and executing commands is extremely high which leads to increased overall work efficiency.
  4. Reliable – Compared to on-site or local ERP servers, cloud servers are much more reliable because data is stored on multiple servers in different parts of the World.
  5. Data-Security – Additional safety software tools are installed on cloud servers to ensure the cloud based ERP installation is secure from malicious attacks and accidental data loss.
  6. Cost-Effective – Cloud based ERP software is installed on the cloud servers of the vendor, there is no need for you to invest in additional hardware or infrastructure and thus this is the most affordable ERP solution for a small business.
  7. Avoid Hiring In-House IT Professionals – If you opt for on-premise or hybrid ERP installations, you’ll have to hire IT experts to maintain the ERP tool and keep it running at all times. This is not a concern for cloud based ERP software.
  8. Hassle-Free Maintenance – When to choose to opt for an online ERP solution, the vendor takes care of all maintenance and upgradation tasks. You can be worry-free and enjoy uninterrupted services!
  9. Scalable – You don’t want a solution that can be limiting to your business growth. Cloud based ERP software is scalable, you can add new modules, and new users at any time. These not only allow but also enable your business to grow to new heights.
  10. Mobile Access – In the modern era, most employees have smartphones and prefer to complete as much work as possible on the go! One of the biggest benefits of cloud based ERP software is the ease of mobile operations.

Also Read: Benefits of Cloud ERP Solutions for Business

Advantages of Cloud Based ERP for Day-to-Day Manufacturing Operations

Other than the benefits that we’ve mentioned above, there are a few other advantages of cloud based manufacturing ERP software.

  1. Improved Productivity – As soon as you implement ERP, you are able to integrate all manufacturing processes and connect multiple departments through a single software tool. This leads to better communication and real-time data sharing for increased operational efficiency.
  2. Reduced Operational Costs – As cloud ERP runs on the vendor site and you only pay a subscription fee, you end up saving a lot of money in the long run. This is much cheaper than implementing on-premise or hybrid ERP and the company money you save can be used for other business development activities.
  3. Customer Satisfaction – Customer is king and everything else is secondary when compared to offering a seamless customer experience. Cloud based ERP ensures you stay on top of your game, satisfy all customer demands, overdeliver beyond their expectations, and win over the market.

Components of Cloud Based Manufacturing ERP Software

Although no two ERP solutions are alike and different vendors offer different modules, below is a list of the most common components for online ERP tools.

  1. Order Management – This module helps keep a track of customer orders and manage them to ensure the right item is shipped and delivered on a timely basis.
  2. Inventory Management – As a manufacturer operating from multiple factories and warehouses, it is essential for you to keep a real-time track inventory to manage new orders and prepare upcoming production plans.
  3. Supply Chain Management – It is an on-going task to manage shipments and keep a track of the distribution of finished goods. Cloud based ERP software has special modules to make this task easy for you.
  4. Finance and Accounting – This is a non-negotiable module in any cloud based ERP software for small businesses. The finance component helps businesses keep a track of their income and expenses, and also file taxes.
  5. CRM – Cloud based customised ERP software will be incomplete without the customer relationship management module. The CRM component helps you offer a memorable customer experience and drive business growth.
  6. Business Intelligence – This is an advanced feature with real-time reporting that helps predict future trends and sales, forecast ROI for business activities, and supervise market shifts.
  7. Manufacturing – Other than the above mentioned common modules for all industries, there are a few manufacturing-specific components in a cloud based manufacturing ERP software. These are aimed to increase the production rate and help supervise all manufacturing facilities, machinery and tools, workflows, employees and other resources.

Types of Cloud Based ERP Deployment Strategies

There are 4 main types of deployment strategies :

  1. Multi-Tenant SaaS – In this type of ERP set up, a single installation of the ERP tool and its infrastructure is used by more than one organization. Although the ERP software copy and hardware are common, the business data remains private and secure. It is one of the cheapest forms of cloud based ERP software implementation.
  2. Single-Tenant SaaS – This is the exact opposite of multi-tenant deployment strategy. In this set up, one organization alone makes use of the ERP installation and its infrastructure. The business data is hosted on a private cloud server.
  3. Public Cloud – Amazon Web Services and Google Cloud are common examples of public cloud ERP services. In this type, numerous businesses use the same cloud computing services. There is no lack of data security or privacy breach.
  4. Private Cloud – In this scenario, the cloud server is allotted to a single organization and not shared by any other business. This is a relatively costly set up.
  5. Hybrid Cloud – This ERP implementation combines on-premise ERP installation with public or private cloud servers. Businesses that desire larger control while still having cloud access to their business data can choose this type of ERP deployment.

Challenges of Implementing Cloud Based ERP Software

A few challenges are common with all sorts of software and ERP is no different.

  • It can be tricky for a small business to transfer all business data to an ERP software
  • As the cloud based ERP software is completely managed by the vendor, this can sometimes make the business experience loss of control
  • Comparatively, cloud solutions are less customizable than on-premise ERP tools
  • As regular maintenance is needed, it can sometimes lead to huge downtimes
  • Before completely shifting to ERP tools, extensive testing is often needed to ensure the proper functioning of all modules and real-time data sharing
  • It can take some time for the employees to get used to the new tool and regular training may be required

Indeed, challenges can’t completely be avoided in the case of ERP implementation. However, if you follow the best practices, you can definitely reduce the chances of any bottlenecks.

Keeping aside sufficient time for employee training, taking all precautions for change management, and regularly interacting with the stakeholders can ensure a smooth transition to cloud based ERP software.

Future of Cloud Based ERP Software

With numerous recent advancements in technology, we can only expect better and bigger things in the coming few years.

It is highly expected that ERP tools will soon be equipped with artificial intelligence for accurate predictions of future trends and sales graphs.

With built-in machine learning capabilities, the scope of work will stretch far and beyond what we can comprehend at the moment but this will not be an exaggeration to say that good times are just around the corner.

New developments can also be expected with advanced remote collaboration features and robotics process automation integration into cloud based ERP tools.

Cloud Based ERP Software for Small Business

As a small business reading this blog, if you are already considering setting up ERP for your small business, you might be wondering if this is the right time or if you should wait.

Here are a few questions that you can ask yourself:

  • Do you collaborate with vendors from around the world?
  • Do you need a one-stop software solution for all business activities?
  • Are you upset with poor productivity and increasing business costs?
  • Are you ready to take your business to the next level?
  • Are you interested to set up ERP but on-premise ERP seems to be out of budget?

Your answers to these questions will help you decide whether or not you must go for cloud based ERP implementation for your small business.

In general, most small businesses are likely to benefit from cloud based ERP implementation because it acts as a single source of truth for your business and your organization benefits from it.

In fact, the sooner you shift to cloud ERP, the easier it will be for you to transition and grow your business seamlessly.

As the return on investment for cloud based ERP is really high, there is nothing for you to worry about. Just look for a reliable vendor and give wings to your business with a cloud based ERP set up.


1. Is Cloud Based Customised ERP Software Expensive?

As a small business, it’s understandable for you to work on the numbers before deciding on going ahead with ERP implementation for your organization.

Although the prices for cloud based ERP varies from vendor to vendor and also depends upon your requirements + need for customizations, cloud ERP solutions are very affordable when compared to on-premise ERP solutions.

Also, the idea is to not look at this as a business expense. The long-term returns of cloud based ERP implementation are not just monetary but also in terms of enhanced business productivity and reduced operational costs.

If you are a small business and in need of ERP set up to bring in more order and automation to your business processes, you must absolutely go for it.

Check your options by exploring different tools available in the market and go with a vendor that offers a wholesome solution for your requirements.

Also Read: The 6 Most Powerful Cloud ERP Vendors

2. What is the Difference Between Cloud Based ERP and CRM Software Services?

CRM stands for Customer Relationship Management which is a software solution that helps businesses to manage their customers and improve overall customer satisfaction while also increasing business revenue.

CRM is a stand-alone module that can be used by an organization along with any other tools that they may be using to run their business. In some cases, CRM can be integrated into eCommerce stores and other software solutions as well.

On the other hand, an ERP tool is a comprehensive software suite that offers end-to-end business management solutions for businesses from any industry and niche.

Most cloud based ERP software has a dedicated CRM module that works seamlessly with other ERP components. Thus, CRM is an integral part of an ERP tool.

If you are planning to implement ERP for your small business, you will no longer need a separate CRM tool for your organization.

If you already have a CRM and are keen on installing ERP, your CRM data can be easily transferred to the ERP tool so that you can switch to using one tool for all business activities.

3. Which is the Best Cloud Based ERP Software in India?

With the growing requirement for ERP solutions, new ERP tools are being launched in the market day in and out.

Instead of opting for a new ERP tool, it’s best for you to choose a tried-and-tested ERP software that has been used by companies from around the globe and has a good customer rating.

One such tool is Proximo by Autus CyberTech. It is not only the most reliable and secure cloud based ERP software in India but also the most highly trusted solution by businesses from numerous industries such as manufacturing, pharmaceuticals, finance, electronics, construction, footwear, cosmetics, plastic, and also steel.

Proximo has been in the market since 2012, we have already served 100k+ customers and have 20k+ positive reviews for not just our product but also our services.

We leave no stone unturned to ensure we offer you the best cloud based customized ERP software solution for your small business that helps you drive your business to new heights.

We would love to help you with a free customized quote for your small business, don’t hesitate to get in touch with us today. Can’t wait to serve you, get in touch with us now!

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