What is ERP?
Enterprise resource planning (ERP) is business process management software. ERP’s allows an organization to use a system of integrated applications to manage the business and automate many back-office functions. These functions relate to technology, services, human resources, and accounting.
The key word here is integrated.
In the past, it was common to find various programs that apply to different aspects of your business. You might have a program for your back-office accounting, another for inventory or payroll, or manufacturing and another for customer relationship management. Since these systems are managed individually, this makes it difficult to know what is happening within your company as a whole. You depend on departmental reports to see the big picture. However, by the time you get the reports, the data is out of date.
Enter an integrated solution ERP.
In an ERP solution, all of the aspects of your business are processed within a single system. There are many benefits of an ERP solution:
1. Integrated reporting
– Unlike the old way of doing business, a good ERP solution will allow you to quickly see all the data you need to make decisions quickly and confidently.
2. Greater productivity and efficiency
– You have heard the adage – a man with one watch knows what time it is, but the man with two watches never knows for sure what time it is. One of the most significant problems of using various programs to manage different aspects of a business is knowing what data is correct and what needs to be updated. Much of the data between applications are duplicated and must be updated in all the systems. This makes maintaining the different systems time consuming and tedious. There is also a higher likelihood of the data containing errors. In a good ERP system, you enter the data one time. Then the data is utilized within the system in the areas it is needed. This makes ERP systems much more efficient and productive.
3. Improved Production and Service
– With an ERP system your production and service can be more streamlined and efficient. Looking to a single source for information from sales forecasting, to know what should be produced and when. You can also make sure raw materials are available for the production to complete work orders and make sure that shipping knows when the production is complete. With multiple software, you create issues with redundancies in the operations. This has a negative impact your staff and the bottom line. An ERP eliminates these redundancies and provides a positive effect on your business.
4. Better communication with customers
– How does an ERP system increase customer satisfaction? An ERP system puts information at your fingertips. When dealing with clients, it is essential that you can provide the correct information to them quickly. It also makes a difference with clients to know that product is being shipped efficiently and on time. ERP can also be responsible for marketing tasks related to lead generation and automated updates on processes. Informed clients are happier clients.
5. Better communication within your company
– With an ERP, employees can get information from the system without the need to ask for it from other departments. Therefore, communication between departments or divisions can then be more focused.
6. Cost savings
– ERP solutions are not cheap. But, by combining every aspect of your business into a single system, you eliminate wasted time and the expense of all the other programs. You will build efficient business processes, which will produce better communication with your staff and make your operations simpler and more straightforward. You will eliminate the need to have people trained in all the other programs and processes. They will be trained on one system. This brings efficiency to your staff and can help you save money long-term.