Enterprise Resource Planning Systems: Benefits and Weaknesses of On-Premise, Hosted, and Cloud Options

ERP Systems
REPORT ON ENTERPRISE RESOURCE PLANNING SYSTEMS
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ERP Systems
Table of Contents
Executive Summary...................................................................................................................................3
1. Introduction...........................................................................................................................................3
2. Literature Review..................................................................................................................................5
3. Research Methodology..........................................................................................................................6
4. ERP System Offerings...........................................................................................................................6
4.1 On-Premise ERP System.................................................................................................................6
4.1.1 Benefits on On-Premise ERP System......................................................................................7
4.1.2 Weaknesses of On-Premise ERP Systems...............................................................................8
4.2 Hosted ERP System.........................................................................................................................9
4.2.1 Benefits of Hosted ERP System...............................................................................................9
4.2.2 Weaknesses of Hosted ERP Systems.....................................................................................10
4.3 Cloud ERP System.........................................................................................................................11
4.3.1 Benefits of Cloud ERP System...............................................................................................11
4.3.2 Weaknesses of Cloud ERP Systems.......................................................................................12
5. Factors to Consider when Adopting ERP systems............................................................................13
Conclusion................................................................................................................................................14
Recommendation and Future Directions of ERP Systems...................................................................15
References................................................................................................................................................16
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ERP Systems
Executive Summary
Many companies have incorporated ERP systems into their operations, therefore; easing entire
process of managing different processes. Enterprise Resource Planning (ERP) System is a
management software, which is used to link all core activities that are carried out in a company
ranging from manufacturing to production. However, there are different ERP options, for
example, on-premises, hosted and cloud ERP system. Therefore, selecting a best option is one of
major challenges encountered by companies. Having realized that I’m studying ERP systems at
Victoria University, management has issued directive for preparing a research paper regarding
benefits and weaknesses associated with ERP options. Thus, this report has described explicitly
different options available, and afterwards, recommending ways on which best options can be
selected such as resources available and reliability of ERP system.
1. Introduction
Enterprise Resource Planning (ERP) System is a management software, which is used to link all
core activities that are carried out in a company ranging from manufacturing to production
(Magal and Word 2011). Currently, many companies have incorporated ERP systems into their
operations to ease management of business operations as well as enhancing automation. ERP
systems operate on a real-time basis, therefore; updated information can be accessed anytime.
This is achieved by integrating business processes to a common database, which is used to
support business transactions through storing all types of data (Morris 2011, p.131).
There are different characteristics of ERP systems, for instance, the following are some of them;
operating on real-time basis, common database and an integrated system. ERP systems are used
to perform several tasks such as order and revenue tracking. Besides, ERP systems also enables a
company to manage its activities centrally, which is very important as different security systems
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ERP Systems
can be incorporated into a single system, therefore; protecting data against external and internal
threats (Magal and Word 2011). Apart from integration of security systems, centralization also
enhances standard coding as well as eliminating data consolidation. Hence, there is a need of
companies to investigate different ways on which ERP systems can be deployed such as on-
premise, hosted and cloud ERP systems (Haddara and Zach 2011). Management have realized
that I’m studying ERP systems at Victoria University, therefore; issued a directive for preparing
research paper on different ways on which ERP systems can be deployed including benefits and
disadvantages associated with each option. Hence, the purpose of writing this research paper is to
describe different offerings associated with ERP systems.
Brief description of report’s structure:
 Executive summary, which has discussed overview of the report.
1. Introduction, which has introduced ERP systems. Also, purpose of the report has been
explained as well as report sections.
2. Literature review, which has discussed recent researches supporting main topic of the
report.
3. Research methodology. Data collection methods has been discussed.
4. ERP System Offerings. Different options have been discussed such as on-premise, hosted
and cloud ERP systems.
5. Factors to consider when adopting ERP systems. Factors that a company should put into
consideration prior to selecting best ERP option among different alternatives have been
discussed.
 Conclusion. Has provided summary of main points discussed in the report.
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