What is ERP Software and Why Do I Need It?

ERP Software

'Enterprise Resource Planning’ is a term that was coined in the 1960’s but the software that we know today was only developed in the 1990’s. Essentially the concept revolves around the requirement for real-time information and the streamlining of business processes, particularly as enterprises grow.

Initially, when a business has seen some expansion, it is run using disparate systems governing finance, HR, and stock control. This is ok in a small business but can very quickly become overstretched and cumbersome as the business grows.

ERP Software Revolutionizes Business Processes

The way that ERP software revolutionizes business processes can be seen throughout the various departments in any given business. With the business management system software, each of the business units - from HR through procurement, finance to delivery - is integrated, providing distribution information as part of the core business model. This ensures accurate and real-time information on stock, cost, and scheduling; all the way through to the shipping schedules in the route to market. For the majority of enterprises, this streamlines working practices on the floor as much as the information flow to management.

With separate spreadsheets and standalone applications there is a great deal of re-keying required to provide reports on capacity, stock management, and sales data, but with ERP these are all integrated into a system that talks to each business unit and the information can be pulled into reports encompassing many aspects of the business.

The uses of this kind of streamlining process are evident for those at the top of the chain. Providing real-time information makes any inefficiencies glaringly obvious and makes dealing with these issues a more efficient and timely operation. Whether it is a distribution issue or procurement, the information provided by the integrated systems will flag both underutilization and lack of capacity. It will also highlight overspend in any area of the business so that decisions to reallocate budget is more clear cut.

How much will an ERP Solution cost your business?

Historically, the cost of implementing such business software has been a barrier to growth for some businesses. This barrier has now lessened as the variety of options have grown. Modular provisions are ideal for tailoring the software to your individual business model but still provides clear automated core business operation processes.

The bottom line for your business is your customers’ satisfaction, and ERP Software will contribute to ensuring your customers continue to purchase from you. By making your processes smoother, and fulfillment of orders more streamlined, any issue with distribution will be highlighted in advance, giving you time to align expectation or relocate stock to fulfill orders. Good communication with your customers and the end user is imperative to maintaining a positive brand image in these days of social marketing.

In summary, although there is a significant outlay involved in buying into the ERP software solution for your growing business, the returns you will reap will ensure it is of significant value for the future of the business. Management and employees can make better decisions faster and streamline your efficiencies for an advantage in the marketplace.

 

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