The 6 Silver Bullets Two-Tier, Cloud-Based ERP Deployment Offers to Companies

Enterprise Resource Planning (ERP) solutions have enabled organization to integrate multiple business functions in a way that helps streamline company operations and driver overall efficiency. Since ERP solutions have found a place in many large, mid-size and small companies over the last 25 years, the main issue now seems to be whether an on-site or a cloud-based solution is best.

In an Enterprise Apps Today article titled Top Ten Trends in Cloud ERP, Christine Hansen, product marketing manager at Epicor Software Corporation, had this to say: “Cloud ERP reduces the time and cost of maintaining infrastructure. Less money spent on IT means a lower cost of product delivery, enabling businesses to get a competitive pricing edge and/or higher margins. This also frees up dollars to devote to hiring, R&D and other growth initiatives.”

With the increasing popularity of cloud-based systems, some organizations are faced with the difficulty of how to transition from the older ERP applications and hardware they have so heavily invested in. In these instances, the cloud offers another a solution that appears to be a rising trend: two-tier deployment. This approach enables companies to add some ERP functions to the cloud, while keeping others on premise. Essentially, a two-tier solution allows an organization to conserve their existing on-premise investment, while still enjoying the advantages of cloud-based functionality.

A cloud-based ERP solution can benefit an organization in a host of different ways – including reduction in installation time and a secure operating environment. But, these are only two benefits cloud-based solutions can begin to offer. Following are six silver bullets offered by two-tier deployment of cloud-based ERP solutions.

  1. Provides fast, detailed, real-time insight into all financial activities

Cloud-based ERP solutions enable real-time data to be retrieved and shared, ensuring accurate visibility into the organization’s financial performance.

Even with partial cloud-based deployment, this accessible, timely information allows for easier and more accurate budget analysis and forecasting, resulting in more informed decision-making and enhanced business performance.

  1. Offers company-wide process alignment and consistency

For companies with multiple locations, a single, collective ERP system across the organization is invaluable. Implementing a partial migration to the cloud offers the advantage of streamlining vital business processes such as quote-to-cash, with all employees working from a single source of financial data.

With the ability to simply add a new company location to your existing ERP system, a cloud-based solution makes expansion efforts significantly easier, with minimal IT effort.

  1. Improves supply chain and inventory management

An ERP solution with a strong financial component can offer more efficient management of inventory and improved manufacturing capabilities. By simplifying the control of inventory levels and costs, with visibility across all locations – even if some of the data resides within on-premise servers – orders can begin to be fulfilled more efficiently.

  1. Speeds the quote-to-cash process

By allowing for tighter integration across multiple departments including sales, fulfillment, billing and cash application, cloud-based ERP solutions can significantly speed up the quote-to-cash process.

Furthermore, incorporating automation into this segment of the operation can quickly eliminate error, improve accuracy and improve cash flow.

  1. Improves reporting accuracy and compliance

Transitioning some data to a cloud-based solution can begin the process of helping companies report financial results in an accurate and timely manner, while complying with applicable accounting standards.  With the ability to retrieve data across multiple departments and allowing some of it to reside in the cloud, financial data can be accessible to requiring it.

  1. Significantly reduces cost

Compared to on-premise ERP solutions, cloud-based alternatives can quickly prove to be the smarter choice when it comes to cost. While the most evident cost saving is the avoidance of upfront expenses related to infrastructure, cloud-based ERP solutions are proving to be significant cost savers.

Most cloud vendors offer an affordable, fixed monthly rate. This allows companies to deploy realized savings into other areas of the operation.

Since the providing vendor is responsible for maintaining and updating the software, associated costs related to IT support, maintenance and upgrades are significantly reduce or eliminated altogether.

Cloud-based ERP solutions have allowed Sales, Customer Management, Finance and Accounts Receivable professionals to have a more significant control over all aspects of a company’s financial, product and sales-related activities, helping to drive more revenue, increase margins and improve cash flow.

Ernie Martin is Founder and Managing Director of Receivable Savvy. He brings over 25 years of experience in financial supply chain management, marketing and communications and draws upon his extensive experience to share knowledge and best practices with AR professionals. His resume also boasts time at several well-known brands and companies such as Tungsten Network, Delta Airlines, CIGNA Healthcare and Georgia Pacific as well as a number of years as an independent consultant.