What is a Connected Cloud-ERP System?

Updated on :July 22, 2024
By :James Mordy

A connected Cloud-ERP system consolidates an organization's dynamic functions and multiple operational activities into one central database, allowing businesses to manage all business processes from a single platform.  In simple terms, a connected ERP is a software app that integrates with other major business applications to create a single unified platform. Connected cloud ERP systems have the capabilities to run, manage, and streamline a gamut of operations ranging from CRM, Accounting, and Human resources to Production, Project management, and Business intelligence. 

In highly competitive business environments, connected ERPs help organizations scale up, communicate seamlessly, increase operational efficiency, and grow profits. The wider acceptance of cloud computing technology contributes further to integrated ERP implementation. 

This article discusses the benefits of integrated ERP solutions, their use cases while integrating with other business apps, types of technical integration, and the challenges organizations face while implementing connected ERP suites.  

Benefits of a Connected Cloud ERP system

#Connected ERP Improves Decision-Making at all Levels of the Organization

Connected ERP converts the ‘stagnant data’  into ‘seamlessly flowing information’ that boosts decision-making at all levels of the organization. 

Individual databases for disparate departments are a norm in the corporate world, especially in large organizations with comprehensive workflows and complicated structures. Now, on the one hand, autonomy and complete control over functional processes can help individual departments to work more efficiently and independently; it may make them inaccessible and isolated, resulting in inter-departmental silos. However, the open-arm accessibility can also be a deterrent to their workflows and may cause unsolicited interruptions while working. 

Connected cloud ERP solves this dilemma. 

For instance, the sales staff can access the inventory data without disturbing the warehouse personnel or triggering any interference or conflict. It expedites decision-making as no time is wasted in seeking approvals and documents. 

Connected cloud erp elminates silos

Connected Cloud ERP System powers the single-application enabled control, management, and visibility of entire business processes allowing organizations to eliminate inter-department pain points and silos. With a holistic view of entire operations, the connected ERP augments the quality, speed, and efficacy of organizational decisions. 

#Integrated Cloud ERP Solutions have High Return on Investment (ROI)

While the initial expenses may seem overwhelming and integrating everything for the first time is a daunting task, over the years, connected cloud ERPs can save millions of dollars for organizations. 

By allowing businesses to access the software anywhere, increasing productivity, and reducing IT costs on upgrades and maintenance, cloud-based ERP can provide a significant return on investment for businesses of all sizes. Businesses can use features (real-time data and analytics, customer relationship management, and automated processes)  to make smarter decisions, increase efficiency, and boost their bottom lines. Plus, with an integrated cloud ERP system, businesses can save time and effort by streamlining processes across departments and systems. 

#Automated Synchronization Across all Channels and Departments: 

ERP is critical for organizations with complex business structures. When functions are executed by a number of internal and external organizational units, connected ERP synchronizes data across multiple departments. 

Updating multiple systems manually to maintain data equilibrium across all channels and departments is inefficient. Initiating corrections or updates in one will require businesses to do the same across multiple databases to keep everything synchronized. Connected ERP systems skip this fallacy. One change in any connected system is automatically updated in real-time to all connected databases. This is a critical advantage of connected cloud ERP and is particularly useful in compliance reporting where discrepancies in inter-department databases can cause ‘regulatory issues.’ 

Automated synchronization also empowers employees from all departments to access the most recent information from any location and saves them from making any decision based on outdated or inaccurate information. 

#Cloud-ERP Eliminates Redundancy, Duplicacy, and Errors in Databases

The CRM and ERP systems usually overlap in certain segments of business processes (e.g., orders, order confirmations, quotations, etc.), thus potentially creating redundant information and documents. Integrating Cloud-ERP with other business apps, such as CRM, inventory management software, etc., will remove the redundancy and duplication of data. A single and central data set will be available across all these applications. 

#Empowers Team for Enhanced Levels of Performance 

Integrated ERP broadens the data-gathering sources and improves the analytical competencies of teams. In integrated ERPs, data is gathered through multiple applications and analyzed at a single source. The analysis presents better insights as it takes into factor multiple functions, segments, and operations of the business. This leads to sophisticated business intelligence and more accurate analysis and forecasting, enhancing teams' performance levels. 

#Adoption of New-Age Technologies is Easier with Consolidated Systems

Integrated ERP eases the adoption and implementation of emerging technologies such as automation, artificial intelligence, data analytics, machine learning, etc.  Consolidated ERP provides a single, unified platform that can accommodate new technologies and processes in a single centralized system. 

#Enhanced Security With Connected ERP Solutions

With integrated Cloud ERP systems, organizations are putting their all information on a centralized server. It is more prone to attacks and can create a major catastrophe if the system is compromised. Therefore, connected ERP solutions come with varying levels of security measures including access mechanisms, multi-factor authentication, security controls, phishing protection, and many more. These security measures protect valuable information and organizations’ most prized possession-the data. The security features imbibed in integrated ERP protect infrastructure, networks, databases, and operating systems. 

Benefits of Cloud ERP

In a nutshell, Connected ERPs  

  • Improve data accuracy and consistency by centralizing all business data in a single system, ensuring that everyone in the organization is working with the same, accurate information.
  • Increase efficiency and productivity by automating many manual processes from multiple applications, freeing up time and resources that can be used more productively in other critical functions.
  • Foster better decision-making by providingreal-time data and analytics, giving managers and decision-makers the data insights they need to make informed decisions.
  • Enhances collaboration and allows seamless communication among different departments and teams. 
  • Boosts flexibility and scalability by customizing workflows to fit the organization's specific needs. 
  • Reduces costs by automating many manual processes, streamlining operations, and reducing the need for workforce efforts. 
  • Get advanced security measures and controls that prevent centralized databases and servers from all types of cybersecurity attacks and potential threats. 

Types of Technical Integration: 

types of cloud erp integration

  • Point-to-Point Integration: It is a coupled integration with custom codes between two endpoints, and it connects two applications. 
  • PaaS: PaaS (Platform as a Service): This type of integration is built in the cloud and centralizes app data from multiple apps. Mostly offered as a subscription-based service, it is easy to forecast the costs over time. 
  • ESB: Enterprise service bus (ESB) is an on-premise app architecture ideal for vertical scaling, and it enables enterprise apps to integrate with each other. However, it is not suitable for SaaS integrations. It offers organizations a centralized way of managing integrated apps. 
  • API-based Native Integration: API integrations refer to connecting applications via their APIs. 

Top ERP Integrations

ERP integration with various software applications

Accounting: 

ERP systems integrated with accounting applications can help organizations get real-time insights into financial data and increase financial performance. From capital budgeting to financial resource requirements and allocation, integrated ERP leads to better resource planning and execution. Integrated ERPs assist businesses in managing payments to vendors, tracking financial measures and provisions, and automating workflows requiring the collaboration of accounting and other departments.

HR 

The past few years saw wild swings in the HR field. Events like Great Resignation, Mass Layoffs, WFH, and hybrid work are now part of the HR world’s lexicon. With changing dynamics of the HR world, applications that power human resource functions and workflows cannot work in silos. An HRM software and ERP integration are required to address the need for resilience and agility in the HR stream. For instance, with supply chain data available from ERP, HR managers can better schedule staff in warehouses, or with available resource data, HRs can adequately recruit a workforce. 

CRM 

The plausible data points for ERP and CRM integration are client account data, profile information, sales order, purchase histories, etc. The symbiotic collaboration of ERP and CRM systems can eliminate duplication of customer records and remove data hurdles in inventory, production, and finance management. Access to ERP data will provide employees that interact with clients with crucial information required for setting appropriate customer expectations. For example, real-time access to inventory data will help sales teams to accurately tell clients about the availability and delivery of their demanded products. 

WMS and SCM

Warehouse management systems and Supply Chain management systems focus on managing inventory, logistics, storage, and distribution. Connected ERP will broaden the focus to include purchase and finance operations. WMS and SCM are rigorously effective solutions for managing warehouse and supply chains, but an integrated ERP incorporates functionalities that help organizations achieve maximum competitiveness. 

Ecommerce

Connected ERP and E-commerce systems expand the e-commerce store’s functionality and user experience. An eCommerce ERP integration can help businesses track leads, orders, shipping times, product information, inventory levels, product returns data, etc., from a single place. Automatic data synchronization boosts the store’s flexibility, capabilities, and revenues. E-commerce ERP integration can reset and update SKUs in real time and eliminate challenges related to inventory. 

Business Intelligence

Business intelligence tools retrieve data, and compile and analyze them for new insights. Integrated into the ERP, the BI functions unleash advanced analysis and reporting capabilities. Connected cloud ERP with BI application can track business performance, identify market trends, identify challenges, and empower strategic business decisions. 

Project Management 

Integrating your ERP with project management tools centralizes work-related data, increases the visibility of projects, sets priority levels for tasks, and aligns project phases with their resource requirements. Connected ERP with project management system holds critical data concerning processes, tasks, workflows, and ongoing projects. It also enables resource allocation for projects based on priority. 

Challenges in Cloud-ERP implementation

Compatibility: ERP integration is a complex process that comes with a number of challenges. One of the most difficult is ensuring that the data from different sources is accurately integrated and the systems being integrated are compatible with each other. This involves testing different components of the system to ensure compatibility. 

Employee Training: Advanced ERP solutions require fresh training for employees who need to learn the systems to use them efficiently. Training people to use the integrated system and ensuring employees understand how to use the different components is also challenging. 

Complexity: While the benefits of cloud ERP integration are obvious and clear, the sophisticated integrations of cloud ERP solutions are highly complex and intricate. The integrations often result in large data sets that are arduous to manage initially. Mckinsey proposed a 7-step model for identifying the cloud ERP readiness of organizations. The 7 dimensions–structure, strategy, systems, skills, style, staff, and ‘shared values provide an assessment of the feasibility of the ERP system implementation in organizations. 

Insecure Connect Points: ERP integrations pull up data from multiple sources into a centralized one. However, security becomes a major challenge if any of the touch points is compromised or has any insecure connect points.  

Cost: IntegratingERP with other applications can be expensive if organizations have to purchase new hardware or software to support the system.

Customization: Connected ERPs are built and implemented after extensive customization to meet an organization's specific needs. The customization requirements are overwhelming in some cases and may require a ton of effort. 

Consolidation: Most businesses may have fragmented ERP systems and related add-on apps that are difficult to consolidate into a single connected ERP. The consolidation may require huge spending and effort.

Overall, implementing an integrated ERP system can be a complex and resource-intensive process, but it can also bring significant benefits to an organization in terms of increased efficiency and improved decision-making. The benefits overshadow the challenges. No surprise that the global cloud ERP software market is projected to stand at 40.5 billion U.S. dollars by 2025, with a CAGR of 13.6%. 

How to Implement a Connected Cloud-ERP System?

Implementing a cloud ERP solution is an important step in modernizing business operations. With the right system in place, companies will be able to access insights and data in real-time. Implementing a cloud-based enterprise resource planning (ERP) system can be a daunting task. But with the right plan, the right service provider, and the right technology, you can make it a smooth, successful process. 

Follow the below steps for successfully implementing a connected cloud ERP solution: 

Strategic Evaluation: Develop a Cloud ERP strategy that aligns with your business objectives. This includes setting goals, evaluating existing processes, and mapping out the needs of ERP implementation. 

Budgeting and Timeline: Chalk out a timeline plan and budget for the implementation process. This will help ensure a successful and cost-effective transition to a Cloud ERP system.

Research: The first step in implementing a cloud ERP solution is to research the available options and select the one that best meets your needs. You should also consider any specific features or integrations that your organization may require. Look for a Cloud ERP solution that's reliable, secure, and easy to use. This may include features like a user-friendly interface and integration with other tools and applications.

Select the Provider: Evaluate the ERP provider’s reputation, client base, previous deployment, quality, pricing, and experience. Check for online reviews and compare services with alternatives. Once you find the perfect fit for your organization, you can buy their services. 

Testing: Once you have chosen the right cloud ERP solution, it's time to start the implementation process. This usually involves setting up the software and hardware, configuring the system, and training your staff on how to use it. Create a plan and environment for testing and monitoring the system to ensure that it is running smoothly and efficiently before actual deployment. 

Final Deployment: With the right cloud ERP solution provider, this step will be easy for you. Once all bugs are removed during the testing phase, and you ensure the entire system is running smoothly, go ahead for the final deployment. 

Conclusion: 

Integrated ERP can be a game-changer for organizations. It is a comprehensive software system that combines the operations of all departments in an organization. This allows for more efficient collaboration and communication between departments, saving time and money. It also provides a single platform for data analysis, allowing for better visibility of company performance. It also eliminates the need for multiple systems and software applications, reducing errors and allowing for more accurate reporting. 

With a connected ERP system, organizations are able to quickly access and analyze data, make better decisions, and increase operational efficiency. It also helps organizations identify customer trends, develop customer relationships, and stay ahead of the competition. 

By integrating processes like marketing, sales, finance, and customer service, ERP can help organizations become more efficient and develop a competitive edge. It also eases inventory management by consolidating multiple functions related to logistics, warehousing, supply chains, etc. Finally, the automated nature of ERP systems can help reduce the need for manual labor, freeing up resources that can be used elsewhere. 

To conclude, an Integrated ERP system can help organizations run more efficiently and maximize profits. 

James Mordy
James Mordy

James Mordy is a content writer for Goodfirms. A voracious reader, an avid researcher, a logophile, and a tech geek he loves to read about the latest technologies that are shaping the world. He often articulates the very nuances of the tech world in his blogs. In his free time, he loves to watch movies and analyze stock markets around the world.

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