Reasons to why your business needs ERP system
It was in the 1990s, when the Enterprise Resource Planning (ERP) system was first introduced. It was a replacement of the then, Manufacturing Resource Planning (MRP) system, which was heavily adopted in the manufacturing industry. ERP system was more appealing compared to MRP because the technology embedded in ERP system allowed businesses to combine their entire operations into a single database, allowing them to respond quickly to market changes.
Following the successful release and widespread adoption of ERP system, many software developers, further develop the existing ERP system, to a more robust, complete system, whereby it is able to integrate across all business functions i.e. human resource, accounting, finance, manufacturing, procurement, business development, supply chain management, within the company.
Fast forward three decades, today, we witness the adoption of Software-as-a-Service (SaaS) and Anything-as-a-Service (XaaS) in ERP systems, allowing ERP system to integrate with the Internet of Things and the Internet of Everything, attributable to the influence of the fourth (4th) Industrial Revolution.
Within the article, you will be given a granular view on the reasons for adopting ERP systems, and the benefits along with it, in your business.
Why your business needs ERP
Consolidate multiple softwares
It is inevitable that companies today share one common issue i.e. having multiple systems to run certain business functions within the company. There would be one system for HR, another system for the sales team, one system for finance and accounting, a few for marketing and the number of systems does not stop there. In addition, a new, unorthodox ERP system will be added to cater to the growth of the business and its environment. At the end, the business processes within the company become unsecured, messy, and lengthy.
Common issues companies faced with different softwares across the multiple business functions:
- Data duplication
- No real-time data
- Lack of productivity and accuracy
- Obsolete systems
- Different update and renewal schedules
- High costs
The implementation of ERP systems provides the company with a uniform interface that connects all of these different processes. With a single dashboard and features like access control and enhanced data security, users can easily access data.
Improve financial productivity
It is inevitable that the accounting department in any company plays a vital role in keeping track of the finances, vis-a-vis the company’s performance. Without a well-organized centralized system, the intricacy of transactions may become daunting.
Here are how ERP system and help the financial productivity in your organization:
Managing Accounting Needs
|Mange capital requirements and cash flows, estimate and predict budget and forecasts, resource allocation of costs across various activities|
|The ERP system allows you to utilize it as a financial management system. It helps with financial tasks including client payment plans, credit management, and revenue tracking.|
Quality data and financial information
|Automated data transmission in the integrated ERP system for accounting improves the data quality, whereby the manual nature of work is reduced, removing errors.|
Customers’ expectations for better products and services at cheaper rates have spurred fierce competition, globally. These shifts can occur quickly when rivals from all over the world emerge as competitors, posing a threat to their local or regional market.
Manufacturers must not only be able to respond quickly by altering their price, product, or service offerings, but they must also be able to quickly deploy such changes across their whole organization. ERP system will allow the company to be agile and adapt better to the micro and macro changes.
Visibility, transparency and data security
ERP system offers extensive visibility into the development and wellbeing of your business, thanks to a variety of built-in dashboards and customizable reports. Users may dive down into important KPIs in greater depth and detail than a separate CRM or accounting system.
These built-in dashboards translate to more accurate bookkeeping, which benefits not just you but also the general public and shareholders by providing a more true image of business performance.
On top of that, the visibility and transparency nature of the ERP system allows for traceability, a key component in a compliance-regulated environment. With robust product data management, quality process controls, and product traceability, most ERP systems provide a comprehensive foundation for managing product innovation.
Mobility and flexibility
For this generation of workers joining the workforce in the next ten years, mobility is critical. Users expect instant access to data and results. In today’s technological atmosphere of fast change, no one wants to wait for an answer.
Internet, cloud computing, and the advent of e-commerce have given global rivals the capacity to challenge incumbents throughout the world and take advantage of new market possibilities. By utilizing cloud technology to swiftly communicate product and process changes throughout a manufacturer’s worldwide footprint, a rapid response ERP helps firms to adapt quickly to competitive threats.
Data from diverse departments of a business is consolidated onto a common platform using ERP software. The requirement for corporate software flexibility is becoming increasingly important when making software investment decisions. ERP solutions may now handle many functions by utilizing a centralized database to deliver correct data to every user, wherever in the globe, on any device. Remote access to the database and crucial figures saves time and effort while ensuring quality work is delivered on schedule.
Stay competitive in the current global market trends. Adopt ERP systems in your business and enjoy all the above-mentioned benefits. Most importantly, utilizing the workforce in making important corporate decisions, compared to the manual work within the company.