Cloud-based applications run over the internet instead of being installed on your computer. They've changed how businesses work by making powerful software accessible, affordable, and easy to update. Here's what you need to know.
If you've used Gmail, Salesforce, or QuickBooks Online, you've already worked with cloud-based applications. But understanding how they actually work and why they matter for your business is a different story.
Ten years ago, most business software lived on your company's servers. You paid huge upfront costs, dealt with complicated installations, and hoped your IT team could keep everything running. Cloud-based applications flipped that model completely.
About Orderful
Orderful is a cloud-based EDI platform that turns complex supply chain integration into something businesses can actually use. We help companies exchange orders, invoices, and inventory data with retailers and suppliers without the headaches of traditional EDI. See how it works or talk to our team about your integration needs.
How Cloud-Based Applications Actually Work
The simplest way to understand cloud apps: instead of installing software on your computer, you access it through your web browser. The software and your data live on servers somewhere else (the "cloud"), and you connect to them over the internet.
Cloud-based applications are technological solutions that users primarily access via the internet. Some portion of the application is managed by a server rather than the user's machine. A traditional desktop application stores and manages all data locally, consuming resources on the device running it. Conversely, in a cloud-based application, data is stored with a cloud service, and remotely accessed computing resources power the app's underlying processes.
When you open a desktop application like Microsoft Word installed on your laptop, everything happens on your machine. The file lives there, the processing happens there, and if your hard drive crashes, you lose everything.
When you use a cloud application like Google Docs, the file lives on Google's servers. Your computer just displays what's happening and sends your keystrokes back and forth. If your laptop dies, your work is safe because it was never really "on" your laptop in the first place.
This matters more than you might think. Cloud applications can:
- Work on any device (your laptop, phone, or tablet)
- Let multiple people edit the same document simultaneously
- Update automatically without you doing anything
- Keep working even when your internet briefly cuts out (they cache data locally)
- Scale up when you need more power without requiring new hardware
The offline capability surprises people. Good cloud apps store recent changes on your device temporarily. When you reconnect, they sync everything back to the cloud and clear the local cache. So you're not completely stuck if wifi drops during a flight.
Types of Cloud Applications (And Why It Matters)
There are many different types of cloud computing applications. Cloud applications fall into categories based on what problems they solve. Here's what you'll actually encounter:
Storage and backup tools keep your files safe and accessible. Google Drive, Dropbox, and Amazon Drive all work this way. They're useful for collaboration because everyone can access the same files without emailing versions back and forth. For businesses, they're critical for disaster recovery. If your office floods, your data is fine. When selecting a data storage solution, your organization should prioritize usability and scalability.
Business operations software runs your day-to-day work. Salesforce manages customer relationships, Trello tracks projects, MailChimp handles email campaigns. These tools used to require dedicated servers and IT staff. Now you just sign up and start using them. The catch is you need to verify they integrate with your other systems before committing. You'll need to consider factors such as price point, features, and integrations to find the right business app for your organization.
Development and testing platforms like Sofy, Appium, and BrowserStack let developers build and test software without setting up complicated local environments. If you're building apps or websites, these tools speed up the process significantly by providing instant access to different browsers, devices, and configurations. Whether your organization specializes in developing applications or you simply want your own branded app, these solutions are a great addition to your tech stack.
Analytics platforms turn your data into insights. Power BI, SAP Analytics Cloud, and similar tools connect to your databases and create visualizations that help you understand what's happening in your business. The cloud aspect means you're not limited by your local computer's processing power when crunching large datasets. There are also smaller-scale data analytics solutions available for growing businesses. To find the right service provider for your company, do plenty of research, weigh the benefits of each prospective option, and ensure the platform integrates with your existing tech stack.
Management and collaboration tools like Asana, Evernote, and GoToMeeting keep teams coordinated. These have become essential for remote work because they work identically whether you're in the office or at home. Management tools and apps are designed for executives and mid-level managers. This category includes project management apps, time-tracking solutions, and record-keeping tools. Along with these options, various industry-specific management applications exist for sectors like manufacturing, retail, and more.
For the individual, these SaaS or PaaS options provide a means of protecting important files, whether they're work documents or family photos. Meanwhile, businesses leverage these cloud apps to store and access data across multiple devices, enabling collaboration among their teams.
The real question isn't which category you need, it's whether the specific tool integrates with your existing systems. A great analytics platform that can't connect to your ERP system is useless.
Why Cloud Applications Beat Traditional Software
Here's what actually changes when you move from installed software to cloud applications:
You Can Actually Afford Good Software Now
Traditional enterprise software cost $50,000-$500,000+ just to get started. Then you paid 15-20% annually for maintenance. Small and mid-sized businesses couldn't compete because they couldn't afford the tools.
Cloud applications typically cost $10-$500 per user per month. That pricing model means a 20-person company can access the same quality software as a 2,000-person enterprise. The playing field leveled significantly. Storing data on the cloud is far more affordable than an on-premises storage solution. But that's just one of the ways cloud-based applications save you money. Cloud apps are also less costly to operate and maintain than their on-premises counterparts.
Updates Happen Without Interrupting Work
Remember scheduling maintenance windows to install software updates? Updates required downtime, testing, and hoping nothing broke. Many companies ran outdated software for years because updating was such a hassle.
Cloud providers push updates continuously with zero downtime. Cloud applications can be developed, tested, deployed, and updated far more efficiently than desktop apps. As a result, they promote improved business responsiveness and allow your organization to quickly adapt to shifting operational needs. You always have the latest features and security patches automatically. This might seem minor until you consider how much time your IT team spent managing updates.
With the enhanced flexibility provided by cloud-based computing services, you can stay ahead of the latest trends, get to market faster, and maintain an edge over your competitors.
Your Team Can Work From Anywhere
This became obvious during COVID, but it matters regardless of remote work policies. Sales reps can access CRM data from client sites. Warehouse managers can check inventory from their phones. Finance teams can close books while traveling.
Desktop applications tied people to specific computers or required VPN configurations that slowed everything down. Cloud apps just work from any device with internet. Cloud applications allow you to access and update data from anywhere while minimizing the storage consumption on your device. As such, they're a much more versatile technology than traditional on-premises or desktop apps.
Scaling Doesn't Require Infrastructure Planning
With traditional software, growth meant buying more servers, upgrading licenses, and potentially rebuilding integrations. That process took months and required big capital expenses before you could serve more customers.
Cloud applications scale almost instantly. With cloud-based apps, you can instantly access additional computing and storage resources as user demand fluctuates. This attribute makes cloud applications the ideal choice for rapidly growing businesses. Need to onboard 50 new employees? Add 50 licenses. Need more storage? Upgrade your plan. The provider handles infrastructure automatically. This is particularly valuable for businesses with seasonal fluctuations or rapid growth.
Security Actually Improves (Usually)
Small businesses often think they're safer managing their own servers. Reality: most small companies can't afford the security expertise that cloud providers employ. AWS, Google Cloud, and Azure spend billions on security infrastructure and monitoring.
Leading cloud providers offer world-class cybersecurity support, delivering enterprise-grade security resources without the exorbitant price tag. Depending on the provider you partner with, they may also supply data backup services that let you recover your mission-critical data in case of a breach or accidental deletion.
Obviously this depends on choosing reputable providers. But a good cloud provider likely offers better security than your internal IT team can implement, simply due to scale and specialization. They also handle compliance certifications (SOC 2, HIPAA, etc.) that would be expensive to achieve independently.
Simplified Operations
When you rely on desktop applications, you may struggle to outsource infrastructure management responsibilities. Consequently, the maintenance of your app will fall to your internal team.
Alternatively, cloud-based apps are managed by third-party providers, meaning your team will face a reduced workload and be free to focus on other critical tasks.
API Compatibility
Cloud-based applications pair with application programming interfaces, which allow the app to exchange information with other software. You can use your API connections to facilitate analytics processes, promote data sharing, and access critical back-end services.
You Stop Paying for Unused Capacity
Traditional software required estimating future needs and buying infrastructure accordingly. Guess too low and you're scrambling to add capacity. Guess too high and you wasted money on servers running at 20% utilization.
Cloud applications typically offer usage-based pricing or flexible tiers. You pay for what you actually use and adjust as needs change. This is particularly relevant for EDI, where traditional providers charged per-transaction fees that fluctuated wildly. Orderful's flat-rate pricing eliminates that unpredictability.
Real-World Application: Cloud-Based EDI
Electronic data interchange perfectly illustrates why cloud applications matter. Traditional EDI required:
- Expensive server infrastructure
- Specialized IT staff who understood X12 protocols
- Custom integrations for each trading partner
- Per-transaction fees through VANs (value-added networks)
- 3-6 month implementation timelines
Cloud-based EDI platforms like Orderful changed this completely:
- No infrastructure needed (everything runs in the cloud)
- No specialized expertise required (platform handles complexity)
- Single API works with all trading partners (reusable integration)
- Flat monthly pricing (predictable costs)
- Days-to-weeks implementation (pre-built connections)
That transformation from months-long, expensive, specialized deployments to quick, affordable, manageable solutions represents what cloud applications enable across business software generally.
Companies using Orderful's cloud platform report 50% faster trading partner onboarding and 70% reduction in EDI management time compared to traditional approaches. Those improvements come directly from cloud architecture enabling better software design.
Getting Started with Cloud Applications
If you're modernizing your business technology, cloud applications almost certainly belong in your stack. The cost advantages, flexibility, and reduced IT burden make them compelling for most organizations.
For supply chain operations specifically, cloud-based EDI integration has become the modern standard. Orderful provides electronic data interchange solutions that help you derive optimal value from your cloud-based applications. With our technology at your disposal, you can expedite the distribution of information, streamline transactions, and automate document exchange processes.
Want to see how cloud applications transform EDI specifically? Check out our platform to understand how we've rebuilt EDI for the cloud era, or speak to an expert today to unlock the power of EDI integration.
Common Questions About Cloud-Based Applications
What's the main difference between cloud and desktop applications?
Cloud applications run on remote servers and you access them through a browser or app, while desktop applications install directly on your computer and run locally. Cloud apps work on any device, update automatically, and store data remotely. Desktop apps tie you to specific devices, require manual updates, and store data locally.
Do cloud applications work without internet?
Most cloud applications need internet to function, but many cache data locally so you can keep working briefly during internet outages. When your connection returns, they sync changes automatically. The offline capability varies significantly by application, so check this before committing if reliable internet is a concern.
Are cloud applications secure?
Reputable cloud providers typically offer stronger security than small businesses can implement themselves. They invest heavily in encryption, monitoring, and compliance certifications. However, security quality varies by provider. Look for SOC 2 compliance, encryption standards, and specific certifications relevant to your industry before trusting a cloud application with sensitive data.
How much do cloud applications cost?
Pricing varies widely based on functionality and business size. Simple tools might cost $10-$50 per user monthly, while enterprise platforms range from $100-$1,000+ per user monthly. Most providers offer tiered pricing that scales with your needs. For EDI specifically, Orderful charges $189/month per trading partner for Web EDI or $1,999/month for integrated solutions, with no per-transaction fees.
Can cloud applications integrate with my existing software?
Most modern cloud applications offer APIs and pre-built integrations with popular business systems. Integration quality varies significantly by provider. Before choosing a cloud application, verify it connects with your specific ERP, CRM, e-commerce platform, or other critical systems. Some connections require custom development work that can be expensive.
What happens to my data if I stop using a cloud application?
Reputable providers offer data export capabilities when you cancel. Before signing up, verify the vendor's data portability policies, export formats available, and whether there are any restrictions or fees for exporting data. You should never be held hostage by a provider because they won't return your data in a usable format.
