FIT9123 Assignment 1: Cloud ERP Systems - Impact and Definitions

This report provides a comprehensive overview of cloud Enterprise Resource Planning (ERP) systems and their impact on businesses. It begins by defining cloud ERP as an alternative to traditional ERP models, highlighting its potential for lower investment and easier implementation. The report discusses the role of cloud ERP in existing Information Systems/Information Technology (IS/IT) infrastructure, emphasizing its cost-effectiveness and accessibility. It outlines four key benefits of cloud ERP: reduced IT costs, flexible work practices, access to automatic updates, and improved collaboration efficiency. Furthermore, the report details the advantages of using cloud ERP systems, including lower upfront and operational costs, rapid implementation, scalability, core competency enhancement, access to advanced technology, and easy integration with other cloud services. The document concludes by underscoring the potential of cloud ERP to streamline business processes and improve overall organizational efficiency.

Running head: CLOUD ERP SYSTEM
CLOUD ERP SYSTEM
Name of the Student
Name of the University
Authors Note:

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Table of Contents
Introduction..........................................................................................................................2
Discussion............................................................................................................................3
Cloud ERP in existing IS/IT............................................................................................3
Cloud ERP in IS definition..............................................................................................4
Four Benefits of Cloud ERP in existing IS/IT.................................................................5
Benefits of using Cloud ERP system...............................................................................8
Conclusion.........................................................................................................................12
References..........................................................................................................................13

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Introduction
Cloud computing is considered to be one of the fastest growing part of IT industry.
Cloud-based ERP has emerged as alternative to traditional model of ERP (Dwivedi & Sharma,
2016). The marketing of cloud depended ERP states that adaptation needs low amount of amount
of investment and can easily be implemented as this service is provided over the cloud. In the
domain of IT, there are no one size which fits the all kinds of solution (Ramasamy & Singh,
2017). Various organization around the globe takes up decision-based on IT system, like
availability of resources for investing, a functional requirement which the organization can easily
serve.
In the coming pages of the report cloud ERP system in existing IS/IT has been discussed
in details. A proper discussion has been provided for cloud ERP in relation to IS definition. Four
key advantages of cloud ERP system has been discussed in details. After that key advantages of
cloud ERP system has been discussed in details.

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Discussion
Cloud ERP in existing IS/IT
Enterprise Resource Planning (ERP) has been adopted on commercial off the shelf
software. But at present, this type of system is considered to be attractive for delivering cloud-
based delivery model. ERP system is considered risky, time taking and expensive IT investment
made by a company.
Fig 1: Cloud ERP
(Source: Ramasamy & Singh, 2017)
ERP system constitutes the basic kind of information which is needed in present business
environment (Jain & Sharma, 2016). It also provides a well-known model of computing in the
various organization. This kind of system offers the best way for efficient planning and
managing of resources for an organization by integration of its information and information
based platform for various kinds of platform-based areas (Haddara, Fagerstrøm & Mæland,

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2015). There is a large number of benefits of adaptation of ERP like reduction of cost, providing
better service, improvisation of productivity, enhancing the resource management, better
planning, and taking of decision.
Cloud ERP in IS definition
The computing of the system that is dependent on the cloud infrastructure is known to be
the Software as a Service. The software as a Service leads to the fact that platform allows the
clients to use the cloud-based applications that run on the computing resources with the help of
the internet (Jalil, & Bakar, 2017). This resources that are related to the com putting services are
maintained in the remote data centers which are dedicated to the applications that intend on
hosting the application on multiple platforms.
Cloud Enterprise resource planning is cost effective and the cost of the front end of the
server is leased by the month rather than purchased. The maintenance of the product is least with
respect to the fact that there has been the main concern for the platforms that are not using the
platform of cloud Enterprise Resource Planning. Cloud enterprise Resource Planning also gives
them access to the services that the company provides form any location that the client is located.
The differentiation of the services due to the location of the client is avoided by using the
platform of Cloud ERP (Bento et al., 2015). The cloud computing finds its use in small-scale
enterprises. The medium-sized business enterprises are also well-benefitted by this technology.
The reason for their utility in the small and medium-sized business is that the cost of the setup is
for user-friendly and also does not have any sustainable expenditure for the front end of the
system. using these features of the cloud computing the company can reach heights of
productivity as the management of the organization gets prolific hence a positive node in the
turnover of the organization is noticed.

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Four Benefits of Cloud ERP in existing IS/IT
Reduced IT costs: Shifting to the infrastructure of cloud computing from the traditional
data storage systems reduces the cost of the managing the IT systems of the organization the
managing of the Cloud computing infrastructure is easier to maintain the traditional
infrastructure of the It systems that were previously installed in the organization. Another
important aspect of using the cloud computing is that the maintenance cost of the cloud
computing is cheaper than the traditional information systems of the business organization. The
entire cost of the Information Technology solution decreases with the aspect of using the
framework of the cloud computing is by the decreasing the cost of purchasing g expensive
information technology and installing the same by using the resources that are provided by the
cloud computing (Chang et al. 2015). The expenses of paying extra money to the staffs of the
company are reduced due to the usage of the cloud computing. The energy consumption cost of
the organization is also reduced due to the fact of installing the cloud computing platform in the
business organization. The time delay is also managed well due to the usage of the cloud
computing platform.
Empirical examples: Daimler Finance services and the NetApp private limited were
affected positively due to the usage of the cloud computing in the infrastructure of their business
organization.
The flexibility of work practices: The major advantage of using the cloud computing
network is the flexibility of the e-services that the networking system receives due to the fact that
connectivity of the cloud computing infrastructure has been immensely dependable in case of the
communication between the computing systems despite the location of the systems. Cloud

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computing gets the benefit of stronger connectivity as the computing systems that are present in
the network is connected on the web platform which helps the employees well as the higher
hierarchy of the organization to have an access to the computing systems of the organization
(Gangwar, Date & Ramaswamy, 2015). This facility that is provided by the cloud computing
provides services to the clients who are based differentially and acts as the global connectivity of
the business organization. This ensures that the clients who are seeking for the service get proper
service from the employees even in terms of location deformities that is present between the
client and the employees. The flexibility in the work practices enables the fact that the
organization gains the efficiency in the performance of the product. The efficiency that is applied
in the framework of the managerial field of the organization helps in increasing the productivity
of the company. this feature ensures that the goodwill of the company is maintained along the
global audience of the company.
Empirical Examples: Autodesk and Addeko have been benefitted as they installed cloud
computing in their organization and enjoyed the performance and the efficiency due to the reason
of the flexibility in their working infrastructure.

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Fig 2: Benefits of ERP Cloud
(Source: Awad, 2014, pp-3)
Access to automatic updates: Another major feature of installing cloud computing in
the business organization is that the cloud computing infrastructure enables the company to gain
the updates of the software that is installed in the infrastructure of the cloud computing system
automatically. Manual functioning of the framework of the cloud computing is lest necessary for
the updating of the software’s of the cloud computing (Awad, 2014). This fact ensures that the
expenses related to the maintenance of the framework of the cloud computing. The fact that the
cloud computing of the infrastructure is auto updated helps the infrastructure to stay protected
from the cybercriminals as it is easier for the cybercriminals to attack the source of the
framework that is not updated to the latest versions of the potential updates. The potential

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updates that are provided to the infrastructure of the cloud computing provide the robustness of
the framework of the cloud computing.
Empirical examples: Dell EMC and the SAS Institute are the organizations that have
been benefitted by the automatic update feature of the cloud computing
Collaboration efficiency: The collaboration with other organization also acts as the
major reason for the application of the cloud computing in the business organization. This aspect
deals with the fact of connectivity facilities that the business organization gets due to the usage
of the cloud computing (Awad, 2014). The clients of the organization are well-searched and the
technology of cloud computing helps in the detecting the potential clients of the organization.
This aspect helps the organization in increasing the proficiency of the marketing strategy that is
provided by the cloud computing framework for the company.
Empirical examples: HCL and Belcorp have been benefitted due to the collaboration
efficiency that is provided by the cloud computing infrastructure.
Benefits of using Cloud ERP system
There is a large number of benefits of using cloud ERP system in terms of ERP benefit
taxonomy like:
Lower upfront cost: As a result of the separation of various computing resources from
various enterprise location (AlBar & Hoque, 2015). The enterprise does not need to pay for a
large number of building the proper environment needed for computing. It only pays off for the
access to the environment over the internet.

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Lowering of operation cost: Cloud service providers (CSP) are generally responsible for
operating and providing cloud services which will lead to the isolation of various operating
environments processes (Seethamraju, 2015). It will ultimately cut down enterprise as well as
various kinds of operational cost. Various kinds of in-house ERP software needs hardware and
human resource for maintaining it. In addition to license and ERP software will increase the IT
budget of the organization. Cloud ERP solution comes up with monthly subscription option
which can easily tailor the need for the initial cost. The implementation cost is considered to be
lower the overall operational cost. The building of solution can easily form a great platform for
development required for construct program from scratch (Peng & Gala, 2014). It focuses on
making use of resources which is considered to add the more challenging domain of business.
Business can easily exploit platform and can add customization at much lower cost for the
organization.
Fig 3: Benefits of Cloud ERP

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(Source: Khot et al., 2017)
Rapid Implementation: CSP offers a wide range of ERP solution, this solution can
easily satisfy the needs of various enterprise (Khot et al., 2017). Choosing between various
solution and product takes place just as per the need of business enterprise.
Scalability: Cloud services are considered to be highly elastic which ultimately relates to
the fact that enterprise can easily scale up or down of various resources as per the needs or
requirements.
Core competencies: Cloud ERP system will help the various enterprise in proper
managing of their business in the much efficient way (Johansson et al. 2015). It has provided the
enterprise to easily access and specialization of technology and advanced kind of resource which
are available in the cloud.
Using of advanced technology: Working on cloud allows various kinds of enterprises to
easily access and make use of specialized technology and advanced computing resources which
are available in the cloud.
Rapid updates and Upgrades: Update or upgrade on cloud solution is accomplished at a
much faster rate than any traditional ERP (Kulkarni et al. 2015). CSP perform all necessary kind
of upgrade as per the need of enterprise.
Easily adding with cloud service: There is a large number of cloud application which is
offered for satisfying the needs of the enterprise (Gupta et al. 2017). As a result of ERP system
which connects different parties inside and outside an enterprise, the integration with another
kind of cloud service becomes much easier.

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Adding up with various cloud service: There is a large number of cloud application
which is offered for satisfying the needs of the enterprise (Weng & Hung, 2014). As a result of
ERP system, which helps in easily establishment with various parties inside and outside the
organization. The integration with another kind of service providers becomes much easier at the
cloud.
Better reliability and cloud services: CSP’s provides proper policies and plans for
restore, recovery and backup and another kind of function which are designed for availability
and disaster recovery.
Cost of transparency: ERP system comes up with an option where enterprise pays for
what they use and they do not need to pay for the thing they do not use.
Sales Automation: In many cases, it is seen that there is a geographical separation
between client and CSP’s which ultimately relate to issues which can accomplish in the cloud.
Using of Security standard: Some of the CSP’s is used as a standard kind of encryption
and decryption which ultimately leads to removal of issues of security form various client to
CSP’s.
Free trials: Many kinds of cloud provider around the globe provides a platform where
the client can easily try to implement their ERP system before buying it. This trial ultimately
increases the certainty of Cloud ERP usability.
Improved ERP performance: Moving the ERP to cloud easily removes the essential
kind of computational power and resources which is considered to be necessary for deploying of
ERP solution (Weng & Hung, 2014). This is considered as good news for small IT organization
which cannot afford the heavy infrastructure because it is the only thing which is considered to