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This article is part of our Buyer's Guide: Learn which cloud ERP system can best help your company

Determine which cloud ERP vendors are right for you

If you and your organization are still up in the air about which cloud ERP vendors to choose from, read this to help find who best addresses your deployment and functional needs.

If you and your company aren't sure which cloud ERP software is the right one for you, you're not alone. Different vendors can have substantially different capabilities. There are different hosting options, such as using a SaaS ERP system or a two-tier approach. With options abounding, one of the critical first steps is identifying organizational needs to help filter out the cloud providers that may not be a good fit should they not be able to offer the necessary functionality or performance.

While it can be a challenge to navigate the cloud ERP waters, there are some leaders that have emerged in the space, each with their own unique functionalities and abilities that work for a range of organizations in a variety of industry verticals.

Clearly define what you need and what you don't need

Your company needs to develop an overarching enterprise strategy so that the IT strategy aligns with the goals of the organization. This will help not only define the direction to go in when selecting cloud ERP software, but what tools will be needed to achieve that direction. From there, system capabilities can be evaluated and filtered to understand what cloud ERP system makes the most sense. Thought should also be put into external considerations including customer and supplier impacts. Defining requirements and capabilities can uncover the true needs, and further prioritization can help separate real needs from wants.

In the earlier era of cloud and software-as-a-service (SaaS) ERP offerings, cloud services differed greatly in certain areas of functionality and pricing, but with the growth of cloud, those distinctions have leveled out. As it stands, the differences between traditional ERP providers moving to the cloud and born-in-cloud ERP vendors are becoming less significant. The differences that do exist are predicted to become increasingly reduced as born-in-cloud and SaaS providers mature and traditional ERP vendors continue investing in their own cloud services. As the various cloud ERP software suites are evaluated, it remains essential to articulate organizational needs and become educated in software focus and capabilities. In the following sections we'll look at some of the options in the market today.

Cloud ERP software for larger or more complex enterprises

Larger enterprises in search of cloud ERP software generally need a system that covers a range of services. Some systems can offer robust functionality due to the various options and modules that cloud ERP vendors offer. The drawback may be that some prepackaged modules or services may not be entirely necessary.

Both SAP and Oracle are long-established leaders in the traditional ERP scene, and both are now moving toward cloud services. This is great news for bigger titans of industry who are not afraid to pay out for a viable vendor with the resources to invest in software. SAP Business One Cloud is a SaaS ERP system that works for companies of all sizes, but has a full menu of ERP functions that make it a viable option for larger enterprises. Oracle ERP Cloud is another flexible, full-fledged option that, while usable for SMBs, is a good fit for large companies. It is available as a public or private cloud implementation.

Microsoft offers public and private cloud ERP services with Microsoft Dynamics AX. Larger enterprises in the manufacturing, distribution, retail and service industries, and within the public sector -- as well as those in the oil and gas, high tech, and software publishing industries -- should look at Microsoft Dynamics AX. They are often a more cost-effective option than tier-one options like SAP or Oracle, but the real draw here is if you're company is a Microsoft shop. Dynamics AX includes Office 365 integration, giving users a familiar Microsoft look and feel.

Cloud ERP software for SMBs

Cloud ERP vendors offer SMBs software that tend to be more industry or functionally specific, designed to meet a more diverse selection of business needs. As opposed to the larger, corporate giants, SMBs are more prevalent across a wider variety of industries, which may have drastically different requirements from their ERP systems. These businesses are often broken down by industries or verticals that highlight their products and services. Many ERP systems on the market today showcase how their capabilities can meet industry needs. What's covered here is only a small fraction of the cloud ERP options available.

Along with an on-premises system, Epicor provides SaaS ERP software that is geared toward the manufacturing, distribution, retail and services industries. Epicor also specializes in the lumber and building industries by offering professional estimating, dispatch and delivery, millwork, and construction services applications.

The differences between traditional ERP providers moving to the cloud and born-in-cloud ERP vendors are becoming less significant.

Infor CloudSuite offers enterprises finance, supply chain, human capital management, customer relationship management (CRM), and marketing ERP functions that support the manufacturing (auto, defense) and the food and beverage industries. However, hospitality companies may be interested in the Infor CloudSuite modules that help give users personalized and pertinent offers that foster brand loyalty. Infor also offers a hotel property management system and a business intelligence module that gives insights into guest histories and preference profiles for real-time recommendations during guest interactions.

IFS targets enterprises in the manufacturing, utilities, and oil and gas industries with their product focus in project-driven solutions. This includes applications that are built for field service management and maintenance and asset management that help organizations track asset-intensive projects, manufacturing and services.

For SMBs selling services to the U.S. government, Deltek is a valid option for cloud ERP software due to its project accounting functions. Deltek's core markets are split into professional services and U.S. government contracting. They specialize in cloud applications for tracking hours and billable activities by engagement, department or other categories.

Another cloud ERP vendor that puts an emphasis on requirements and traceability is Plex. Plex made a name for themselves within manufacturing and industries that demanded strict requirements in areas of traceability, quality and food safety. The Plex Manufacturing Cloud is also used by life sciences and medical manufacturing businesses that need to manage batch and flow manufacturing with a well-integrated, modular ERP software system. Plex Manufacturing Cloud also allows for both discrete and process manufacturing in the same facility and complies with various automotive manufacturing regulations.

QAD Cloud ERP is also viable cloud ERP software for manufacturers. Through multiple acquisitions, QAD has built an ERP system that helps support businesses in verticals like the automotive, food and beverage, consumer products, tech, and life sciences industries. QAD states that QAD Cloud ERP is advantageous for medical device and biopharmaceutical manufacturers who need support with acquisitions and divestitures, because their cloud ERP software puts an emphasis on quality-oriented business processes and a reduction in the risk of product noncompliance.

An increasingly popular cloud ERP system is NetSuite, which is being used in a variety of organizations. This rapidly growing native SaaS leader can be found in various industries such as manufacturing and distribution, but also professional services, energy, nonprofit and education. NetSuite's services are predominantly geared towards medium- to enterprise-sized businesses, so it can be on the higher end of the pricing spectrum.

For those looking for something more specific

If the above options are too broad or still not flexible enough, there are plenty of other applications worth considering that offer more specific functionality and integrate with ERP systems. For instance, Salesforce is a leader in CRM that supports sales teams. Marketo is sold to marketing departments as a tool to track marketing campaigns. Workday is a growing cloud-based human resources and payroll system. Both Intacct and FinancialForce have gained ground in the area of finances, while Xactly is paving the way in compensation and incentive management. The specific capabilities these packages offer often positions them as powerful additions to an ERP.

If it's still too overwhelming or your organization is still recovering from the last ERP implementation project, it's often advisable to partner with independent resources that have the expertise and objectiveness to help aid in the selection of the right cloud ERP system. As you can see there are a wide variety of cloud ERP vendors that are expanding into specific organizational needs to address the unique aspects of a company. These are only a sample of the options available and these cloud ERP systems will continue to grow in services, offerings and functionality. The key is educating yourself and working with resources to help make the appropriate decision when investing in a cloud ERP.

Adam Boyce is a consultant with the independent ERP consulting company, Panorama Consulting Solutions. He is not specifically endorsing the products or cloud ERP vendors noted above over what may be appropriate for any given situation or company.

Next Steps

Traditional, on-premises ERP vendors are facing challenges thanks to the cloud.

Here are some factors for discrete manufacturers to consider when choosing an ERP system.

Cloud ERP software is only getting better.

This was last published in June 2016

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Which cloud ERP vendor do you believe is a good fit for your company and why?
Maybe he differences between traditional ERP providers moving to the cloud and born-in-cloud ERP vendors are becoming less significant, but traditional providers are terribly expensive and also their software is made like in late 70-s.