Enterprise resource planning (ERP) refers to systems and software that help manage various processes of an enterprise. The processes managed by ERP software usually include manufacturing, the chain of supply, financial processes, and other services. ERP software can prove extremely beneficial when it comes to automating and simplifying tasks done by individuals in an organization.
What is ERP software?
Enterprise source planning software (ERP) is a software that enterprises or businesses use to manage their daily business tasks. Other than managing these daily business tasks, if a business goes for the complete ERP suite, they also get some additional benefits, such as budgeting, managing the business’ performance, planning, predicting, and reporting the financial results of a business.
ERP software plays a crucial role in bringing various processes of a business together and helping a smooth flow of data between those processes. The ERP collects the transactional data from various sources, duplicated data are removed, and final and accurate data are made available at one place.
ERP software plays a huge role in the managing of businesses across fields and of all sizes in today’s time. With the ease of managing the services it gives, ERP software has become an integral part of many businesses now.
Benefits of having an ERP software
By now, you would have understood that having an ERP software implemented can mean efficiency and increased productivity. However, in addition to this, there are several other benefits associated with getting an ERP software for business. Here, we dig deeper into some of them.
- Predictions
Having ERP software in place helps the users, managers, and business owners access correct forecasts about the venture. The predictions provided by an ERP are extremely accurate. This means that a business can easily plan future endeavors based on those forecasts and have the future course of their operations decided. - Flexibility
ERP software understands how to keep up with the trends. This means it is flexible toward any changes to meet the demand of the users. Having an ERP software does not mean that you will have to make changes to the way you operate. Instead, the ERP software will adapt to your ways based on your manufacturing needs. ERP software will also understand the needs of a growing business. So, as the business scales, you will not have to worry about purchasing new ERP software. - Efficiency
By now, we know that boosting the business’ efficiency is one of the primary benefits of having an ERP software in place. It removes any duplicate process in the system and eliminates the need to enter any information manually. Streamlining the process in a business done by an ERP software comes handy when it comes to collecting data. Any employee, regardless of which department they are in, can have easy access to these data. - Productivity
A lot of time that goes into manually performing tasks can be saved by having an ERP software introduced to your business. It also eliminates any repetitive processes, which means the workers will have more time at hand to perform the tasks that require their attention. With an ERP, performing the tasks will also be easier, leading to a boost to productivity. - Connection
Connecting different departments in an enterprise with each other is another benefit of having an ERP software that cannot be overlooked. When various business departments collaborate, the workers have more visibility into how the operations are being carried out in the organization. All the information is put into the ERP system, which makes it centralized. Once there is a source of centralized data, it becomes easy for all departments to communicate and work with each other. - Scalability
ERP is a structured software, which allows adding more users and functionalities as the business grows. As the business progresses, the software will keep making sure that it accommodates the operations’ growing needs. - Cost-effective
Once you have an ERP software introduced to the business, your operation and administration cost will be reduced by using the correct information in real-time. Managing operations with ERP software ensures that there are no delays in production. This allows managers to make critical decisions quickly, thereby preventing any monetary loss due to delays. - Ease of access from anywhere
Certain ERP software will enable you to get access to a database that is centralized. This means that employees can work from their homes or from wherever they wish to. Working from their office desk to complete a task is no more a requisite with ERP software. - Staying ahead of the competition
Having an ERP software will surely require a good investment. However, you must know that not having an ERP software will cost you more. Many companies choose to stick to old methods of management and end up lagging behind their competition. Therefore, having an ERP software is a wise investment, as it can put you right ahead of your competition in terms of productivity and efficiency. - Single source of data
When you have ERP software, you no longer have to worry about having data scattered at various sources. All your necessary information can be accessed at one single location with an ERP software. This also means that the chances of having more accurate and consistent data also increase dramatically.
Tips for picking the best ERP software for your business
Once you sit down to pick the best ERP software package for your business, you will notice that there are so many options to pick from, and that can leave you overwhelmed. Business owners often fall for marketing gimmicks of brands and select products that do not fit into their needs. Therefore, while picking an ERP software, you must know the factors based on which you need to evaluate. Also, introducing ERP software will be a significant transformation for any business. Hence, the decision of choosing the right one should be taken seriously. Here are some ways that can help you conclude.
- Review and analyze
You must remember that getting an ERP software is a business decision. Therefore, you must first list down and document all your business processes, mention the weakness, and then write down the strengths. While you are doing this analysis, you need to clearly see how the processes should appear in the future. A well-defined vision about these processes’ future will let various ERP software vendors show you how their software will prove to be useful in context with the needs of your business. - Keep in mind the infrastructure
Getting an ERP software is more of a business-oriented decision rather than a technology initiative. However, when you are purchasing a software, you cannot overlook your company’s current infrastructure. Understanding how the software will fit into your present business scenario is essential. - Don’t ignore the cost
It is common to have ERP software sales representatives to not highlight the expenses and risks involved with buying the software. However, to ensure that you are not caught off guard, consider all the costs involved with getting an ERP software beforehand. Knowing the cost early in the process will let you accept the investment that you are going to make, and it will prevent you from getting fooled by any sales representative. Also, make sure that no hidden costs are being charged. There are chances that you might be getting overcharged in the name of implementation costs, software maintenance, hardware upgrades, etc. So, ensure that there is absolute transparency about the cost of the ERP software. - Keep your implementation plans realistic
Getting the software does not mean it is the end of the process. Therefore, be realistic about the total time required to get the software up and running. The duration estimates should be taken from the vendor beforehand so that you can have a realistic plan. Your plan should be extensive and must involve not just the time it will take to install the software but also the time that it will take to make sure that the software is running fine. These estimates should be taken into consideration before you buy ERP software. This way, you will be able to know the cost and the commitment of resources that you will need to put in to implement the software successfully. While you are devising an implementation plan, you should consider the various processes of your business and the design of the workflow that will be used to migrate the data, among other aspects. - Keep track of the benefits that your business will get
If you don’t keep track of the potential benefits that you will get from the software, you might not be able to achieve them. Various businesses can have different motives behind getting an ERP software. For instance, a business owner might be looking at getting an ERP software to increase efficiency, reduce costs, or scale growth. However, no matter what the aim is, you must keep a track of the advantages that you wish to derive from getting an ERP software implemented in the system. - Be open to options
This is an essential tip for you to keep in mind when you pick an ERP software for your business. At first, you might not know this, but they are more than just a couple of ERP software vendors that you can choose from. You might have only heard of a few, but that is because they own a significant market share and have a solid marketing in tow. However, what you must know is that there are, at least, 70 vendors who provide ERP software solutions, and each one of them offers different features and functionalities. Many businesses go for an ERP software brand based on the credibility or what their competitor is going for. Instead, they should be looking at a solution that fits their needs and fulfills all the business requirements. For this, they need to be open to considering options. - Look for referrals
Talking to employees, your co-workers, and some contacts about ERP software brands can give you a better insight into the various features of a vendor. You can talk to multiple people and take feedback on the service that they have been using and how useful it has been for their business. You can also conduct online research to know which is the most suitable ERP software vendor. If things still don’t work out for you, consider hiring a consultant specializing in ERP software. Looking for recommendations is one of the wisest choices you can make while buying ERP software. Assuming that you have read or researched enough on the products over the Internet might not go in your favor, and you might end up buying something that is not worth the investment. Once you have heard the pitch of an ERP vendor, look for independent sources to verify whether the sales representatives’ claims are true or false.
Now that you have a fair idea about ERP software, you can go ahead and avail of one without any further delay.
