Reason #2 of 5 to Upgrade Your ERP System: Compliance & Security

Compliance requirements and security threats to businesses today are constantly evolving, and employers must remain ever vigilant to stay compliant and protected. However, you should not confuse data compliance with data security. These two processes are often referred to as though they are interchangeable, but they’re not. Just because you’re compliant does not mean you’re secure.

Compliance ensures your company meets legally mandated minimum standards only. Data security, however, refers to all the “processes, procedures and technologies you use” to safeguard “sensitive data against security breaches.1” If updated, your ERP system will know more about your industry than you do and will not only help you stay abreast of the latest compliance regulations but will also better protect you against the latest security risks. Even better if you move to a modern cloud ERP platform.

Over time, performance issues with ERP software arise more frequently and cause more trouble, but a modern ERP system can improve compliance and security in six key ways:

1. Reporting accurately and transparently:
   As billing structures become more complex, so does accurate revenue recognition and reporting. Using an ERP system to manage this process eradicates the need for a specialized team, a preponderance of spreadsheets, and monotonous manual data entries (which often leads to errors).
2. Reducing data errors:
   Speaking of errors, automating repetitive tasks reduces the probability of manually generating bad data. It also frees up your team to be more diligent in checking for compliance requirements.
3. Providing quick, efficient, and relevant audit data:
   Streamlined end of year reports help your teams easily manage audits, freeing them up from the pressures of, say, tax season and giving them peace of mind. Ultimately, an ERP system makes your data audit friendly.
4. Reporting consistently across multiple entities:
   The more your company grows the more complicated compliance becomes. Investing in an ERP “that’s built to scale as your company grows will enable you to track data and remain compliant as you expand.1”
5. Avoiding Cyberattacks and Maintaining Security:
   The average cost of a cyberattack has doubled since 2021, with “47% of all businesses suffering in some way.” (Hiscox Cyber Readiness Report). Business with fewer than 500 employees may expect to pay anywhere “from $2.98 million” to a record “164 million” per data breach2. For very small business and startups, a breach may not even be survivable. The best way to avoid a cyberattack is to prepare for one, and an updated cloud ERP system can be your front line of defense. It can provide security parameters to help with the following issues:

• “Enhanced Security Across Multiple Platforms and Devices.
• Network security: separation of duties and layered defense architecture
• Operations security: data encryption at-rest and in-transit, centralized secured certificate management, least privileged authorization model
• Applications security: OWASP threat analysis and remediation, vulnerability and penetration testing, security best practices
• Monitoring and management: Dynamic password management, immutable SIEM collection and analysis, ITIL based incident, problem and change management processes.”3

6. Facilitating Compliance Policies and Processes:
   Modern cloud ERP systems aid in adhering to compliance requirements such as ISO 27001, NIST 800-53 Standards, SSAE18 18 Assessments, as well as a published annual SOC report for review which significantly reduces manual entry errors and frees up employee time.

ERP technology can help your business with security and compliance by providing a protected and centralized platform that ensures data consistency, accuracy, and security. Implementing ERP processes to enhance security and compliance will ultimately generate peace of mind for you, your employees, and your clients.

1. 5 simple ways an ERP system improves compliance for your company. (2020, August Binary Stream.
2. Halperin, A. (2023, February 21). Worried about a cyberattack? What it could cost your small business. Business News Daily.
3. Infor.com