Enterprise Resource Planning, or ERP, can help companies automate their entire operations in just one system – from finance/accounting through to manufacturing, procurement, sales, logistics and even human resources.
Many firms nowadays have some form of automation in place for their operational or financial needs, but often these systems operate as standalone processes and do not talk to each other.
What is Enterprise Resource Planning?
A centralized software system such as ERP offers businesses a different and much more useful capability, bringing all the different processes together to create one integrated system. ERP can comprise and combine different modules to meet a company’s specific needs, and indeed to serve different industries.
This single network, designed around a common database, not only enables firms to see exactly what is happening in any part of the business at any given point in time, but it can also link to external third parties, such as logistics and shipping partners, and banks.
In fact, ERP is not new. It has been around in some form or another since the 1970s. The concept originated in business accounting systems, used in areas such as tracking accounts receivable and payments to suppliers. Over subsequent years, the system has evolved and spread into every other facet of business operations, undoubtedly boosted in more recent times by faster internet speeds and cloud-based solutions.
So, what benefits can ERP bring to your business? Here are 10 top reasons why you should consider an ERP system:
- Centralized control. All information is held in one database, which leads to better – and more up-to-date – communication between departments. A centralized system replaces the practice of each department creating and updating its own, separate spreadsheets. No data needs to be entered more than once in an ERP system, which also spawns other benefits such as higher data integrity, enhanced security, reliable back-up and intellectual property protection.
- Better management. Managers can easily see where efficiencies need improving. For example, an ERP system will show how much can be produced or shipped in a day, as well as any loss factors per yield. This gives managers the ability to research where and what the operational problems are, for instance lack of training, or poorly functioning equipment, and take the necessary action.
- Enhanced customer service. A good ERP system provides complete visibility of a customer’s record. When a customer calls, it will show who they are, what they buy, what their process is and whether their products are in stock – all without having to contact multiple departments and look at different spreadsheets.
- Increased sales. Data held in the system will alert companies of a change in sales levels and any reduction in profitability. For instance, it will send an alert when a customers’ buying pattern changes – for example, if they stop buying a particular product, so that staff can take the appropriate action.
- Mobility. Employees can access all systems from a tablet, smartphone or personal digital assistant (PDA) anywhere they are, meaning they don’t have to stay at their desks.
- Analytics. Data can be extracted easily, providing top-down analysis, reports and dashboards, spanning multiple departments.
- Long-term planning. The information can be used as a historical tool to forecast sales in the months or year ahead. Once the company has finalized the forecast, ERP can assess what volumes of raw materials are needed to produce the required amount of end-product, enabling companies to talk to their suppliers and plan inventory at the right time and price.
- Standardization. Business processes can be made uniform across all operations, divisions and locations, which is especially helpful when acquiring another firm with a need to ensure all employees work in an identical manner. It also helps firms grow more efficiently and aids in onboarding new staff much more quickly.
- Regulatory compliance, particularly in the chemical and process industries, is another area of benefit when using an ERP system, as it provides a much-simplified process and reduces the potential for human error. The software easily generates the multiple documents required, such as safety data sheets and certificates of analyses, among many others, for government agencies that include the Environmental Protection Agency and Occupational Safety and Health Administration.
- Logistics management. Very effective in an ERP system. It brings advantages in automating inventory control, making sure the right products are in stock at the right time and speeding up distribution. It also gives an accurate picture of costs and can track production, shipping and delivery.
ERP systems can be designed to fit companies of any size and the efficiency benefits are too good to ignore, so why not take a look at Datacor’s offering?
Datacor ERP Features:
- Centralized inventory and procurement, business intelligence, manufacturing, accounting, customer relationship management;
- Granularity and automation for streamlined operations in every department;
- Enhanced data integrity, internal processes and company-wide productivity; and
- Straightforward implementation and customization without programming.