What Is SaaS ERP in Cloud Computing?
Software-as-a-Service (SaaS) ERP is enterprise resource planning software delivered over the internet rather than installed on-premise. Organizations use ERP software for project management, accounting, procurement, and other day-to-day operations.
In the past, organizations purchased or developed this software and installed it in their offices or data centers. With SaaS ERP, they can now access these services over the internet without having to deploy them on their computers to reduce costs, take the hassle out of hardware upgrades, improve scalability and availability, and more.
How Does SaaS ERP Work?
When ERP software is delivered using the Software-as-a-Service model, the resource planning applications are hosted on the vendor’s servers.
Your team can access them over the internet through a username and password on virtually any computer or mobile device regardless of the operating system they are using—all they need is a web browser. For security reasons, access to SaaS ERP can be limited to authorized (work) devices.
The SaaS ERP vendor manages updates and maintenance for the software and hosts all of your data in the cloud. Your IT team doesn’t have to maintain the SaaS ERP software—the vendor does that for you.
In some cases, SaaS ERP is delivered through apps rather than a web browser to provide better performance. With that delivery model, the most that you have to do is download and install the latest version of the app the vendor provides.
SaaS ERP solutions are usually based on a monthly per-user subscription. In other words, you pay only for the resources you use, making SaaS ERP a scalable, cost-effective choice.
SaaS ERP Examples
Compared to individual SaaS apps, SaaS ERP solutions provide a complete enterprise operations management ecosystem with advanced security.
Most leading providers of on-premise ERP software have made the transition to the cloud. Some of the biggest providers of SaaS ERP solutions right now include SAP, Microsoft, and Oracle, to name only a few.
With any of these, you can choose a monthly plan based on the number of users who will access the software. Features include inventory management, sales forecasting, financial management, customer relationship management, and more.
Advantages and Disadvantages of SaaS ERP
Are SaaS ERP solutions right for your organization? Take a look at the following pros and cons of SaaS ERP solutions to better understand what they can offer you and what to be careful about.
- Fast Implementation – Implementing an on-premise ERP solution takes time and often requires an investment in hardware and staff training. SaaS ERP solutions can be set up more quickly and with less effort.
- Lower Costs – From initial costs to maintenance and upgrade, a SaaS ERP is usually cheaper than on-premise ERPs.
- Updates and Maintenance – The vendor manages these for your enterprise, saving you time and freeing you from the need to pay for IT expertise for this task.
- Portability – Many SaaS ERP solutions can be accessed on mobile devices.
- Reduced Control – With a SaaS ERP solution you lease rather than own the software, meaning you don’t have full control over the software systems or their customization.
- Internet Dependent – This type of ERP solution won’t work if your internet connection fails. Connection issues may cause data disruption.
- Security – SaaS ERP stores data in the cloud, which can theoretically increase security risks. However, vendors use advanced security protocols to keep your data safe.
The Bottom Line
For many enterprises, SaaS ERP solutions have become a faster, more affordable, and more convenient way to access resource management tools. With their scalability, quick deployment, and attractive pricing model, these solutions can save enterprise IT teams from a lot of troubles.
However, when choosing a SaaS ERP, it’s important to consider carefully all the features and read the terms of service that the vendor provides. Not all SaaS ERPs are equal.