Many people in the business world have at least heard of enterprise resource planning (ERP). If you own or manage a company, you’ve probably know a bit about the benefits of ERP and its newer iteration, cloud ERP. Here are six reasons cloud ERP makes practical business sense.

Cloud ERP Doesn’t Require as Much Initial Investment

In the past, operating an ERP system required organizations to install extensive on-site hardware and hire full IT departments. This sort of ERP is called an on-premise ERP. Cloud ERP differs from on-premise ERP because it’s run through the Internet. Essentially, cloud ERP software doesn’t require companies to put forward a ton of initial capital for computing power and personnel. Instead, cloud ERP typically runs on a subscription basis, which makes it more approachable for small- and medium-sized businesses.

Cloud ERP Can Expand Your On-Site Network

Businesses owners all over the world are realizing that employing remote workers can save them money. Before cloud ERP, it was difficult to get remote workers onto an on-site ERP. Now, it’s as simple as connecting to the Internet. Since cloud ERP software is available anywhere there’s Internet, remote workers can now easily access all necessary company information.

Cloud ERP systems provide a further benefit to companies that work on remote job sites. It has traditionally been difficult for workers at off-campus job sites to troubleshoot issues without having to contact someone at headquarters. And even then, the true problem is often lost in translation. By having all relevant data at their fingertips on a tablet other smart device, employees at job sites can make better decisions in less time.

Spend Less on Labor

Cloud enterprise resource planning software can help businesses cut down on some of the upfront expenses of ERP services. However, cloud ERP can also decrease labor expenses over the long term as well. One way cloud ERP does this is by automating certain tasks. There are some accounting and human resources procedures that can be programmed into cloud ERP, such as payroll duties. Additionally, while you will likely want a few employees dedicated to maintaining your company’s cloud ERP, it’s certainly fewer than the number required for a full IT department.

Track Real-Time Data

Old ERP systems are able to do some amount of data collection, but nowhere near the amount that’s possible with cloud ERP software. This is because cloud ERP can track real-time data from devices that are connected to the system. For example, a logistics company could work with an agency like the Syte Consulting Group to implement an ERP that can track fuel efficiency of individual drivers and then offer advice and incentives for improvement. This sort of power allows business owners to increase efficiency in ways that would have been unimaginable a few years ago.

Automatically Integrate Departments

It’s still not uncommon for larger companies to use conflicting programs in different departments or regional offices based on managerial preferences. While this was an acceptable practice in the past, with the onset of data analysis, it makes much more sense to integrate everyone onto one platform. This makes it easier for managers and executives to identify key internal company trends. It also simplifies interaction and sharing between departments and offices when everyone is on the same program.

Cloud ERP Is Scalable

There are many reasons why a business might want to rapidly scale its operations up or down. Cloud ERP makes this easier for companies since it’s based on a subscription model. This means that organizations can pay for more or fewer features as they need them. Especially for seasonal businesses, the ability to scale ERP through the cloud can make a huge difference in profitability.

These are a few of the reasons why cloud ERP makes practical business sense. There are many types of organizations that can greatly benefit from the adoption of cloud ERP software. It’s important for all business owners and managers to consider if their workflows could be improved by implementing cloud ERP.