Why SMEs Should Think About Running ERP Workloads on Cloud

April 2, 2025

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As technology is evolving and there is more internet penetration, it is leading to more customers shifting online, and businesses are adapting to stay up to date. Online data has become an integral part of business transactions, and there are large volumes of data created that need to be processed and managed at high speeds. In the past, business data could be handled manually, but now this is not possible even for small and medium enterprises (SMEs).

What Is ERP?
Enterprise Resource Planning (ERP) is a type of software package used by organisations to plan and manage day-to-day business activities such as manufacturing, procurement, financial processes, services, risk management, customer relationship management, supply chain operations and project management. ERP systems collect any organisation’s shared transactional data from various sources, providing a secure and centralised data repository which helps in eliminating errors or data duplication, thereby improving efficiency.

According to Oracle, the business processes of 95% of the companies have improved due to ERP. And due to the rapid expansion of the ERP market, the total market size is expected to exceed $49.5 billion by 2024. One of its emerging markets, the Asia-Pacific is expected to achieve a 13.2% CAGR by 2026.

Shift to Cloud

As more organisations relied on ERP to streamline their business processes, ERP also had to evolve to cater to the growing needs. New features and functionality were added, and eventually, there was a shift to the cloud or the software as a service (SaaS) model. In 2018, more than 64% of companies used SaaS. With this infrastructure, there is more flexibility and greater choice for enterprises. It is estimated that by 2022, the global cloud application spending will reach $226.9 billion, and the cloud platform services will reach $70 billion. The ERP cloud model is also beneficial for SMEs, as listed below.

Quicker Implementation
An on-premise ERP solution requires a longer time for setting up and implementation, which includes disruption of business operations and resource allocation. On the other hand, deploying a cloud-based ERP solution is easier and much faster and can be scaled up or down depending on the needs. As there is no hardware instalment, there is no lag time in getting the program running. Any software upgrade or addition on the cloud can also be done easily.

Cost Reduction
The implementation costs for cloud-based ERP solutions are low, and any maintenance or updates is handled by the vendor. Unlike previous systems, there are no additional costs involved for IT staff, office space, electricity, repair etc.

Improved Performance
By integrating an ERP solution, all departments which previously had their independent information system can share data which can be accessed easily. Increased transparency and productivity can help in boosting the business and overcoming certain challenges.

Streamlined Data Flow
Using ERP systems that provide streamlined data flow, businesses can grow faster. Quicker decision making can be undertaken by using the real-time data provided by the cloud-based system, which can help in better management, marketing, and accounting for an organisation.

Better Data Security
All confidential data of the company and a secure gateway for remote access is provided by the ERP applications, keeping the data secure. These systems offer multiple layers of encryption that enhance the security level, thus eliminating any chances of data loss, breach or theft.

Reduced Complexity
Since all the processes are streamlined, employees can be given unique access to the data. There is no need for their physical presence in the respective departments or any particular location. There is also no requirement to export or re-enter any data, resulting in a decreased error and increased productivity. The same processes can be accessed from any place, simplifying operations and saving time and energy.

Scalability
If an organisation manages processes manually or has an on-premise ERP, it is difficult to scale the business as this would either mean increased work or increased expenses for larger data storage. With cloud-based ERP systems, scaling up or down becomes very easy for a business without any expensive inputs.

Continuous Support
To remain efficient, servers require maintenance by the IT staff of the organisation. But with cloud-based ERP systems, the vendors that own the servers are able to maintain it while also being able to provide continuous support to the business. New features, updates and overall security is provided by the system without any requirements from the staff.

Using the cloud-based ERP solution, small and medium enterprises can leverage the same systems used by large enterprises, thus improving their business operations and overall quality of work. The increasing requirements of the digital economy, which includes faster processing, easy collaboration and easy-to-use interfaces can now be easily met. Seizing new opportunities and innovating quickly is possible for all businesses by opting for this solution that provides flexibility and better productivity.

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