Enterprise resource planning (ERP) software is a necessity for modern businesses. This software is used to help enterprises manage their day-to-day activities—such as accounting tasks, compliance management, project management, and supply chain activities. While many traditional ERP solutions use an on-premises architecture, more modern and adaptable SaaS solutions have become the new standard.
What is SaaS? More importantly, why should your ERP software be delivered via a SaaS solution?
What is SaaS?
SaaS is an acronym for software-as-a-service. This is the term for a software product that is accessed remotely from an individual’s or organization’s computers without there being a full copy of said software on the local drive. Instead, the software itself is run on the cloud service provider’s hardware and users simply access it over an internet connection.
SaaS solutions allow enterprises to access cloud-native software programs for their businesses without having to worry about maintaining infrastructure, planning out future capacity expansions, or managing software patches/updates.
The more important question is: “What does ERP software have to do with SaaS?”
Cloud ERP and SaaS
Enterprise resource planning software does not have to be delivered via a SaaS methodology. For years, the standard practice was to build internal infrastructure and then either build or license an ERP solution. However, many businesses have started migrating from traditional ERP solutions to cloud-based ERP tools.
According to an article from CFO.com, a survey showed that “60% of participating technology professionals said they expected their companies’ approach to IT in 2020 would be focused on off-premises cloud solutions.” In the same article, it was stated that “70% of companies’ core applications currently run on-premises or in co-location facilities.”
What is motivating this switch from traditional software hosting models to SaaS-based ones for ERP software? The answer to this question can be found in the benefits of SaaS for modern enterprises.
What Are the Benefits of SaaS for ERP?
Simply being a new way to do things isn’t reason enough for an enterprise to change the way they get their software. After all, businesses need to make decisions that help them improve their return on investment for the money they spend. Otherwise, they run the risk of wasting money and losing their competitive advantage.
So, what are the benefits of SaaS when it comes to delivering your ERP software? How does using cloud software improve your ERP solution? Here are a few of the benefits of using enterprise cloud solutions over using on-premises software:
- Reduced Cost Variability. One of the challenges of maintaining an on-premises data center to run your ERP software is that these data centers may have variable maintenance costs from month to month or even year to year. Not only do you need a software license for the ERP software, you need to maintain the servers/data center, manage database licenses, pay for equipment upgrades, and manage operating system licenses. These costs can vary wildly depending on what needs replacement or repair in a given month. By using cloud enterprise SaaS, you can offset these variable costs onto the cloud service provider (CSP). And, because they split these maintenance costs amongst all of their clients, they can be further minimized. This allows the CSP to charge you a single, flat monthly rate for SaaS access—making costs more predictable and easier to budget for.
- Simplified Maintenance. Instead of having to provision internal team time and labor to inspecting and maintaining the physical assets needed to run your ERP software, you can leave these tasks to your SaaS provider’s team. This frees up your IT personnel to focus on more important tasks that generate value for your organization.
- Centralized Data Management. On a cloud software-as-a-service solution, all of the data the app needs to run can be kept in a single, centralized database. This makes data management simpler so workflows can be more consistent and data loss risks from keeping information on different servers can be avoided. It also has the added benefit of making data easier to secure by putting it on a remote system that has its own set of security measures.
- Increased Enterprise Mobility. The ability for employees working remotely to access critical data and applications remotely improves a business’ enterprise mobility. With improved enterprise mobility, companies can leverage a “work from home” or “work from anywhere” strategy that helps to attract new talent, alleviate the stress of the morning commute, and reduce costs for office space/maintenance. The mobility-friendly nature of cloud ERP applications delivered as part of a SaaS solution makes them incredibly helpful for modern businesses.
These cloud benefits can be taken even further by using a Complete Cloud solution that simplifies new cloud software implementation by providing services for assessing your SaaS needs and configuring your ERP software to better meet your needs.
A truly “complete” cloud solution also includes post-implementation support to provide ongoing troubleshooting and configuration services whenever they’re needed—helping your enterprise get more out of its cloud software investment.
Curious about the Complete Cloud and how ERP SaaS can help your enterprise? Reach out to the Drivestream team to learn more.