Cloud Based Open Source ERP

Cloud-based open-source ERP software is not only a mouthful of industry based terms, it also combines a multitude of technologies.

The term cloud-based refers to the application of cloud computing. Although experts have experienced difficulties coining the exact definition, the National Institute of Standards has defined cloud computing as “the use of internet to access software among other resources offered on-demand so as to execute tasks among other business processes” (Mell & Grance, 2011, pg 9). Browser based email clients, such as Gmail and Hotmail, are basic examples of cloud based software. Applications hosted in the cloud, such as the aforementioned, are also referred to Software-as-a-Service (SaaS) products and generally sold on a subscription basis. The SaaS model saves the end-user the difficult and time consuming task of upgrading or patching software, as the server or host company is able to push updates seamlessly in their own environment (McKenna, 2011). Other service delivery models in cloud computing include Infrastructure-as-a-Service (IaaS), and Platform-as-a-service (PaaS).

Open Source describes a model that promotes universal access and distribution of a product design or a blueprint via a free license, including subsequent improvement of the original design by its users. In relation to software, the program source code is freely available to the public in the hopes it will encourage users and developers to improve and customize the base feature set.

ERP (Enterprise Resource Planning) refers to a broad-based system that integrates software applications from the various sections of a business. An ERP system serves both internal and external functions of an enterprise. The internal functions deal with core activities such as operations management, financial management, and human resource management (Sahara & Koch & Tucker, 2008, p.5). On the other hand, external functions of the system focus on integrating systems with those of suppliers and partners. The external integration facilitates the exchange of information from the company to other value systems, whereby the enterprise’s value chain is connected to the suppliers’ or distributors’ equivalent.

When combining these technologies together, you effectively have a freely available, out-of-the-box ERP solution with the option of hosting on-premises or in the cloud – a revolutionary approach when compared to the expensive systems available in the past.

ERPNext is one of the latest open-source cloud ERP systems made available to the public. It is built upon a powerful web application system based on Javascript, Python and MariaDB. ERPNext claims to deliver the most comprehensive ERP solution for most Small and Medium-sized Businesses in the retail, manufacturing, distribution, and service industries. Like its competition – Odoo and WebERP, ERPNext promotes itself as an SME solution that is flexible, scalable, adaptable, affordable, and efficient in Australian and global business environments. Its features include inventory management, financial accounting, purchasing, customer relationship management (CRM), and human resource management, manufacturing, support management and e-commerce.


Web Notes Technologies also offers ERPNext as a paid SaaS subscription through their private hosted network – FrappeCloud. This model further reduces the end user’s dependence on local IT support and infrastructure. The SaaS model also enables Web Notes Technologies to seamlessly update and run the most recent versions of ERPNext.


The future of the ERPNext system is promising as it is easily customizable and gaining a dedicated and growing user base.

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