If you read about business solutions, the chances are that the word ERP would come up. Well, ERP stands for Enterprise Resource Planning. It is used to describe a class of software that can manage and simplify all the essential processes that are vital to running a business.
This includes accounting, overseeing your human resources, managing your inventory, and even placing orders. Essentially, ERP streamlines the processes in an organization and ensures that management has valuable data and actionable insights.
ERP systems have been around since the 1960s. However, the latest ones come with Artificial Intelligence (AI) and machine learning technology to enhance their ability to provide support to management. With the assistance of ERP, the decision makers of organizations can focus on more important things like figuring out ways to make the workforce more efficient and improve profit margins.
ERP systems are usually composed of different applications that are synchronized together. For example, there will be a separate ERP application for sales and another for accounting. However, they would both be able to access the same data.
ERP systems are beneficial for businesses of all sizes – small, mid-sized, and large and types such as manufacturers, wholesalers, retailers, and more.
Moreover, to increase the performance of the ERP system, it can be hosted on the cloud. For example, hosting Sage 100 ERP on the cloud offers businesses with better visibility into the data as the individuals can access it remotely.
Why Do You Need an ERP System?
You may think that everything is functioning well in your organization, and you do not need an ERP system. But you may be wrong. Here are a few signs that your organization can benefit from an ERP.
1. Is data management a difficult task in your organization?
One of the key advantages of using an ERP system is that it improves data management tremendously. Instead of spending hours keeping a log of sales or balancing your expenditure, you can use an ERP system to automate the process.
Another thing that makes ERP systems so efficient is that the data from the different divisions of your organization are synchronized. For example, when you make a sale, it is automatically logged via the POS system, and this data is made available to the accounting department.
As a result, instead of wasting time tracking data and balancing books, your workers can spend their time doing more important tasks to improve the profitability of your organization. Generally, ERP systems boost productivity in this and different other ways.
2. Do you have issues balancing your finances, or do you find that some funds are unaccounted for in your business?
There are certain situations where the details of certain transactions are missed out due to data discrepancy. If you have ever had to figure out how certain payments disappeared, then you know this can be a headache.
The root cause of this issue is inefficient data management. ERP systems can solve this by automating the data collection process and creating a data web between the different branches of your organization. The insight provided by ERPs ensures that there are no inaccuracies and that you can get real-time financial reports.
3. Are you struggling to stay competitive?
The competition among businesses has grown stiff in recent times. You need to make decisions quickly to capitalize on the latest business trends. But you cannot make such decisions without timely and accurate business insights.
This is where ERP systems come in. By providing you an overview of your business, you can easily spot opportunities and capitalize on them. Also, as indicated above, some of the latest ERP systems come with machine learning technology which allows the software to predict trends and put you a step ahead of the competition.
4. Are you struggling to keep your customers happy?
Every business depends on customers to stay competitive. If you fail to satisfy your customers, then your profits will dwindle. It can be challenging to predict what your customers want and how to keep them satisfied without the proper data metrics.
This is exactly what ERP systems provide. By giving you a bird’s eye view of the performance of the different sectors of your business, you can be able to spot lapses and come up with strategies to improve the customer experience.
5. Do you struggle to comply with the regulations in your field?
Another advantage of an ERP system is that it allows you to track the regulatory compliance of your organization without any difficulties. It can be an arduous and time-consuming task to ensure that your company is abiding by the regulations of your field.
Usually, this involves using spreadsheets and keeping a lot of paperwork. However, this is not always effective and can lead to a lot of irregularities.
With ERP systems, the task of keeping up with regulatory requirements is automated. You can configure the system based on the requirements of your field and see to it that the different divisions of your organization are complying with the regulations right from your dashboard.
How to Implement an ERP System in Your Organization?
If you recognize the importance of ERP systems, and you’re considering implementing it in your organization, it is essential to note that there is a right way and a wrong way to go about this. Here are some steps to keep in mind to ensure the proper implementation of an ERP system in your business.
A. Map out the different divisions of your organization
The very first step when implementing an ERP system in your organization is to determine which sectors of your organization would be using it. Every organization is different, and the ERP tools on the market vary in terms of the type of organizations. By mapping out the various sectors of your business, you can determine which ERP system to get.
B. Carefully choose the ERP system with the best features
There is no best ERP system for every organization. Instead, particular ERP systems may be best suited for some organizations than others. Therefore, before you decide on which ERP system to use, look at the features it has to offer and how it will benefit your business.
C. Do not hesitate to seek professional help
The process of setting up and training your workers to use the ERP system can be made smooth by seeking professional advice. These professionals have experience implementing this software for businesses and have all the technical expertise needed to deal with any issues you may encounter.
ERP systems are essential for every business. However, this is not a “one size fits all” solution. You must take the time to choose the software that best suits your business and take advantage of the features that it offers.