SaaS ERP Solutions Provide Unparalleled Access and Flexibility

Introduction

SaaS ERP (Enterprise Resource Planning) solutions are web-based ERP systems hosted in the cloud instead of on-premise servers. SaaS ERP offers companies an innovative alternative to traditional, time-intensive and expensive on-premise ERP implementations.

What is SaaS ERP?

SaaS ERP refers to an ERP platform and modules that are hosted by a third-party cloud service provider and accessed over the internet. Rather than purchasing servers to host an ERP on-site, companies access the software, data storage, computing resources, and other system capabilities from a remote cloud platform.

With cloud delivery, resources are pooled in the vendor’s data centers and costs are distributed across their customer base. The ERP capabilities can be scaled dynamically based on usage and demand. So SaaS ERP eliminates the need for organizations to buy and support an IT infrastructure and perform system maintenance themselves.

Benefits of SaaS ERP over traditional ERP

SaaS or cloud-based solutions provide many distinct advantages including:

BenefitDescription
AccessibilityUsers can access reports anytime, from anywhere without VPNs
FlexibilityEasy to add capacity to handle peak order seasons
Cost SavingsDiscontinued expensive on-prem server infrastructure

Accessibility and Flexibility Advantages

SaaS ERP architecture fosters more adaptive, resilient and continuously optimized business processes and operations. Key drivers of the accessibility and flexibility gains include:

Access enterprise solutions anywhere

With the cloud ERP solution hosted externally in a vendor’s environment, organizations do not have to invest in on-premise infrastructure. Users across business units and geographic regions gain 24/7 access to the ERP over the internet via laptops, desktops, tablets or smartphones.

Rather than supporting VPN and remote access connectivity into an internal company network, all that is needed is an internet connection and supported web browser. This enables users to perform key workflows whether working at headquarters, traveling, or based in satellite offices.

Flexible deployment models

Whereas legacy ERP software was typically managed on-premise with additions of hardware capacity requiring long procurement and change control processes, SaaS ERP allows rapid provisioning through a simple online subscription process.

Usage can elastically scale up to handle peak demand periods such as seasonal spikes, special projects or growth phases. Conversely capacity and connected apps can also scale down when activity is slower to minimize expenses.

Easy to scale usage up or down

With the flexibility to subscribe to only essential ERP modules like finance, inventory or HR to start with, additional capabilities can be activated as needed. This phased approach gets solutions supporting priority business processes live quickly.

If surges in data volumes are expected during tax or financial reporting periods, temporary capacity increases allow the ERP to effectively manage the workloads. Scalability assures optimal application performance.

Then as operational needs shift over time, subscriptions can expand to bolster functionality or users, or contract to reduce monthly fees based on usage. This cost aligns system capacity with business demand rather than over or under-provisioning resources due to long-term uncertainty.

Software Upgrades and Maintenance

In addition to eliminating the headaches of managing infrastructure and data centers that come with on-premise ERP platforms, SaaS ERP also simplifies the chore of system upgrades.

No headaches for managing infrastructure

With cloud solutions, organizations avoid capital outlays and overhead costs to operate data centers including space, power, cooling, networking and staffing expenses. Instead the subscription fees provide a predictable operating budget for system usage.

It also relieves internal IT staff from having to continuously monitor and optimize infrastructure capacity and performance. Instead they can more strategically align technology capabilities with desired business outcomes.

Seamless software upgrades

Whereas on-premise ERP upgrades often require extensive testing and scheduling downtime on nights or weekends to minimize business disruption, SaaS ERP updates automatically happen behind-the-scenes so users access the latest version without interruption.

This means companies using the software can immediately leverage new features and fixes that accelerate processes or close feature gaps. It also assures all application instances run fully patched and secure code.

Automatic bug fixes and patches

Bugs and defects often take weeks or months to troubleshoot, patch and deploy updates into production with traditional ERP platforms that run locally. With cloud solutions, fixes can deploy across the customer base virtually overnight to eliminate flaws.

Similarly where new security threats arise, centralized patching by the SaaS vendor allows all customers to quickly receive protections without needing to manually install updates or risk exposure windows. This automation ensures resilience.

Business Continuity and Data Security

In addition to operational agility advantages, leading SaaS ERP platforms incorporate robust continuity and security capabilities leveraging economies of scale.

Maximum uptime

Reputable SaaS vendors contractually commit to very high application availability, as much as 99.9% uptime excluding planned maintenance windows. Redundant infrastructure prevents single points of failure. If one component goes down, automated failover avoids disruption.

They also regularly test contingency protocols. In event of a broader outage, system restoration and recovery capabilities exceed what typical organizations can independently support to minimize downtime. This assures continuity.

Secure data encryption

Data security is paramount for cloud services. SaaS vendor apply defense-in-depth models spanning physical data centers, hardware infrastructure, networks, systems, applications and data layers. Customer data receives persistent encryption and standards like SOC2 compliance provide transparency.

Regular data backups

While small hiccups in a SaaS environment have minimal impacts on services, reliable backups help guard against larger failures. SaaS vendors often backup customer data every few hours to separate storage sites so it stays protected. This facilitates quick restoration after incidents.

Financial Benefits

Transitioning from legacy on-premise ERP platforms to SaaS solutions provides compelling financial advantages including lower costs, flexibility, and predictable expenses.

Low upfront costs and setup fees

Whereas on-premise ERP requires significant capital investments into servers, storage, networking equipment, data centers, real estate and other infrastructure up front before going live, SaaS ERP has very low or no setup fees.

Pay only for what you use

The subscription model allows companies to start small then flexibly scale up modules, users or capabilities as needed rather than over-purchasing capacity due to uncertainty about long-term requirements. This optimizes spending.

Predictable operating expenses

With cloud services billed monthly or annually based on consumption, costs become more forecastable without variable or intermittent expenses to operate infrastructure popping up. This simplifies budgeting.

SaaS Integration and Customization

While delivered as standardized software services, SaaS ERP platforms offer customization and extension mechanisms to tailor to unique needs.

Integrate with other cloud solutions

APIs and messaging protocols connect SaaS ERP with other best-of-breed cloud solutions like CRM, HCM and financial applications. This interoperability avoids monolithic suites locking data in proprietary systems.

Customize for specific business needs

Whether tweaking user interfaces, configuring business logic like approvals management or adding proprietary extensions, SaaS ERP capabilities can adapt to support specialized requirements above the out-of-the-box functionality.

SaaS ERP Industry Solutions

As SaaS ERP penetrates deeper across sectors, vendors expand vertical-specific capabilities that speed implementations by pre-configuring processes for that environment.

Manufacturing industry solutions

Predefined workflows, quality management enforcement and inventory optimizations for repetitive or batch production accelerate manufacturing solution adoption.

Distribution industry solutions

Streamlining supply chain execution, logistics and warehouse operations for wholesalers and distributors via industry standard procedures tailored to the operating models facilitates rapid ROI.

Services industry solutions

Common functions spanning project financials, resource management, billing and work order management reduce the need for services businesses to fully customize platforms.

SaaS ERP Functionality

The multi-tenant architectures of SaaS ERP support extensive capabilities across back and front-office functions:

Financial management modules

Core general ledger, accounts payable/receivable, asset management and financial reporting modules integrate information flows.

Supply chain modules

Inventory, bill of materials, purchasing, sales order and warehouse management optimize planning.

CRM modules

Quote to cash processes from lead/opportunity management through order processing, billing and collections improve visibility.

HR modules

HR, payroll and benefits administration streamlines workforce lifecycle support from pre-hire to retire.

Implementation and Training

Smooth adoption ensures organizations realize rapid time to value from SaaS ERP investments.

Phased rollout options

Rather than risky big bang cutovers, phased deployment by locations, business units or functionality areas minimizes disruption. This allows lessons from initial go-lives to optimize subsequent ones.

Intuitive user interfaces

Consumerized apps minimizing required user training drives adoption. Graphics, dashboards and embedded analytics make interfaces intuitive. This accelerates user productivity gains.

Online training and support resources

SaaS vendors provide extensive self-service portals with training videos, user community forums and knowledgebase articles to augment formal training. This lowers total cost of ownership while promoting best practices.

Leading SaaS ERP Vendors

Many software vendors now deliver ERP systems via the cloud. Leaders known for maturity include:

Oracle NetSuite

One of the first pureplay SaaS ERP providers, NetSuite drives rapid implementations leveraging pre-built industry capabilities. The unified suite integrates ERP, CRM, ecommerce and HR on a common data model.

SAP Business ByDesign

An affordable SAP SaaS ERP solution helps midmarket organizations scale globally with built-in analytics, workflow and in-memory performance. Preconfigured industry processes accelerate rollout.

Microsoft Dynamics 365

These integrated cloud ERP and CRM applications enable data-driven decisions and intelligence. Tight integration with Microsoft infrastructure and office productivity suite eases adoption.

Moving Forward with SaaS ERP

Organizations looking to modernize legacy ERP platforms via SaaS options should take an incremental path when getting started.

Assessing organizational needs

Document key pain points with existing systems, prioritize required capabilities, and outline expected outcomes to build consensus around solution requirements across leadership and user communities.

Selecting a vendor

Research the vendors above and additional alternatives to identify the best aligned platform for integrated ERP. Assess security, scalability and functionality capabilities against needs.

Planning the deployment

Define rollout scope including processes, locations, and timeline. Outline data migration approach, change enablement and success tracking to minimize disruption while fostering benefits realization.

SaaS ERP Evaluation Criteria

Key criteria for selecting a SaaS ERP system include:

Functional requirements

How completely does the platform satisfy core financials, inventory, supply chain, manufacturing, product lifecycle management, CRM and analytics needs out-of-the-box?

Industry-specific capabilities

Have underlying data models, workflows and reports been pre-configured based on industry best practices that match operational processes?

Data security

What certifications, audits and architectural controls defend and monitor system access, data encryption, availability and resiliency to satisfy corporate policies?

Scalability options

How elastically can usage scale up/down to support business growth, M&A or spinoffs over time while maintaining performance?

Key SaaS ERP Implementation Decisions

Critical choices underpinning successful SaaS ERP rollouts involve:

DecisionCurrent ApproachRationaleRecommendation
CustomizationLeverage standard capabilities instead of heavy customizationAccelerates ROI and smoothes upgradesContinuously evaluate unnecessary custom code for removal
IntegrationAdopt integrated modules over discrete appsTight cohesion improves user experienceAssess remaining disjointed processes for streamlining
Change ManagementDaily triage meetings to address issuesDrives user adoption and productivityQuantify usage metrics and sentiment to guide strategy
TrainingOnline self-service resourcesLowers total cost of ownershipBuild training completion into employee performance metrics

Managing the SaaS ERP Transition

Meticulous oversight ensures continuity during major technology transitions like SaaS ERP adoption.

TacticResultRecommendationTimeframe
Cutover WeekendIntermittent performance and unexpected outages after launchSet expectations properly around stabilization periodFirst 2-4 weeks
Daily triage meetingsRapid response to new incidents and challengesFormalize issues management processFirst 2-3 months
Dedicated transition teamMomentum regained by restoring confidenceDevelop comprehensive transition plan pre-launch6 months before to 6 months after
Incremental rolloutInitial departments adopt capabilities firstPrioritize order of activations based on capabilitiesFollow 2-3 month cycles

Getting the Most from a SaaS ERP

Realizing the full promise of SaaS ERP requires persistence beyond the initial implementation.

TacticOutcome
Initial training weekBasic feature adoption after launch
Deeper trainingExpand feature fluency over time
Nudging team usageMaximize value from existing investments

Future of SaaS ERP Technology

Innovations on the horizon will further advance SaaS ERP benefits.

Emerging TechnologyPotential Benefit
Machine learning capabilitiesOptimize inventory planning decisions
AI-driven stock movement adviceCut overall working capital needs
Ambient intelligenceStretch limited staff resources further

Conclusion and Summary

In summary, SaaS ERP solutions eliminate substantial IT infrastructure costs and management headaches associated with on-premise ERP platforms. Cloud delivery provides unprecedented accessibility for a distributed workforce along with scalable usage and automatic updates.

Leading SaaS ERP vendors offer solutions tailored to industry-specific needs backed by SLAs for performance and resilience. Phased deployment models smooth migrations from legacy environments. Rich functionality, intuitive interfaces and flexible customization minimize business disruption.

Over time, innovation will continue expanding the value of SaaS ERP solutions through emerging technologies like artificial intelligence, improved vertical capabilities and enhanced experiences. Organizations looking to liberate resources and accelerate business processes should actively consider adopting SaaS ERP.