What is meant by a cloud-based ERP system?

A cloud-based ERP system refers to a system that is accessible via the internet and hosted on remote servers. This means that businesses do not need to invest in expensive hardware or infrastructure to run the ERP software. Instead, the software is provided as a service (often referred to as SaaS, or Software as a Service), allowing users to access it from anywhere with an internet connection.

This setup offers several advantages, such as scalability, as businesses can easily adjust their usage based on their current needs. Additionally, regular updates and maintenance are typically managed by the service provider, which reduces the burden on the internal IT team. The system often supports collaboration among users in different locations, further enhancing its value for distributed teams.

In contrast, traditional setups that run on local servers or require on-premise use limit access and flexibility, making it harder to adapt to changing business needs.