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The Internet and information and communication technologies (ICT) have known an exponential evolution. This has led to a fourth industrial revolution (Industry 4.0) where companies are massively relying on modern technologies like Internet of Things, Artificial Intelligence, Augmented Reality, Robotics, Cloud Computing and Cloud ERP (Alcácer and Cruz-Machado, 2019; Tongsuksai and Mathrani, 2022). Among these technologies, Cloud Computing (CC) is a recent innovation in the ICT domain, which has introduced new standards of functioning and access to ICT since hardware and software are used by customers on demand and according to a pay per use mode. This supports the evolution of the companies’ ICT infrastructure with an investment adapted to the needs (Dutta et al., 2013).
CC is among the trends that have influenced Traditional (or on-premise) ERP (T-ERP) leading to the emergence of Cloud ERP (C-ERP) (Salum and Rozan, 2017). The latter is a software package provided through the Internet where ICT infrastructure and data are hosted and managed in the cloud by C-ERP providers. It includes solutions to manage simplified and standard business flows on Web architecture (Lenart, 2011).
C-ERP systems are one of the most important trends in the recent years (Bjelland and Haddara, 2018) that have grown from the T-ERP systems (Tongsuksai and Mathrani, 2022). Several authors (Albar and Hoque, 2019; Safavi et al., 2014; Tongsuksai and Mathrani, 2022) have enumerated the benefits that are likely to be achieved by firms, particularly SMEs, when using these systems. In fact, they are easy to be used, deployed and maintained. They allow avoiding heavy investments in ICT infrastructure and training (Albar and Hoque, 2019), which help SMEs to overcome the lack of financial and human resources (Safavi et al., 2014). According to Sridharan et al. (2011), ICT investments involve fixed costs (such as hardware, software, storage, licenses, etc.), operating costs (such as maintenance costs, system upgrades, etc.) and training costs. With a short budget for the initial investment, lack of experience and related technical support, CC and C-ERP offer an alternative technology for SMEs intending to invest in ICT outsourcing resources (Alcácer and Cruz-Machado, 2019). Moreover, C-ERP reduces the need for ICT maintenance, software upgrade and licensing costs. This improves firms’ operational efficiency, productivity and innovativeness (Al Isma’ili et al., 2016). It also allows obtaining competitive advantages and improving performance (Salum and Rozan, 2017; Bhatti, 2017; Mohammed and Burhanuddin, 2018).
According to Tongsuksai and Mathrani (2022), switching from T-ERP systems to C-ERP becomes a trend. In comparison to T-ERP, C-ERP is based on more advanced technologies and it is more cost effective since licenses and maintenance efforts at the company premises are not required. The same authors added that C-ERP allows “low upfront costs, automated upgrades and updates, ability to restore and back-up information at any time, quick reconfiguration based on customers’ needs, as well as capacity to handle change and growth” (Tongsuksai and Mathrani, 2022). Therefore, as the adoption of T-ERP is a costly and challenging endeavor, C-ERP can be an alternative system for companies and SMEs in particular.