ERP for Businesses | MicroChannel

ERP for Businesses

What is ERP?

An ERP or Enterprise Resource Planning is a software that automates business processes and workflows, improves control, and provides insights from a centralised database that seamlessly integrates finance, inventory, supply chain, production, warehousing, sales, marketing, and human resources management. Team members can use the information in a centralised database to analyse different scenarios, uncover new opportunities, suggest improvements that translate to cost savings, better productivity, and ultimately improved profitability.

Modern ERP software systems are built to cater to businesses of all verticals with embedded best practices and thus have become a critical tool for businesses across different industries. Businesses rely on ERPs for their day-to-day business activities, enabling access to real-time data across different geographical locations and departments. Human errors can be minimized as there would be less need for manual data entry by employees and queries & reports can be generated easily and quickly without IT intervention. In a nutshell, ERP helps to unify resources, processes, and technology across any business.

Definition of Enterprise Resource Planning (ERP)

As per Wikipedia, Enterprise resource planning (ERP) is the integrated management of main business processes, often in real-time and mediated by software and technology. Enterprise resource planning is categorised as business software that contains a few modules to address specific business requirements. The software fulfills different functionalities, for example, accounting, inventory management, customer relationship management (CRM), warehouse management, project management, and more. All these are fully integrated within the same database, thus minimizing data corruption or human errors from manual data entry.

ERP Fundamentals

Most ERP systems are built on a single common database. This means that the data for each company’s business processes is stored in one place. This makes it easy to share data across the company. Information flow through different business functions, departments, geographical locations so there is seamless sharing of information throughout the organization. ERP is the enabler for resources (people), processes, and technology in modern companies.

ERP makes it easy to collect, organise, analyse and distribute information throughout organizations so that every team member can perform their role in the most efficient manner. Instead of spreadsheets and multiple disparate standalone systems, ERP can bring all resources together and create a better order.

How ERP can help businesses?

An ERP system can help businesses of all sizes to identify new opportunities for expansion and also identify areas for improvement. A high adoption rate can maximize the use of ERP to fulfill the specific needs of each business. Whether it is a spike in demand, delay in shipments, low cash flow due to overstocking – an ERP solution allows you to drill down to the specific issue so that you can proactively mitigate the issue.

The Business Value of ERP

More companies are implementing ERP solutions because there are obvious benefits across various departments. Besides a lower operational cost as the main value of implementing an ERP system, below are some of the business values an ERP offer businesses:

• Real-time visibility
• Instant access to business data
• Ability to uncover new opportunities
• Ability to identify issues
• Ability to make faster decisions based on real-time data
• Automation of tedious and redundant tasks
• Access from anywhere (not confined to business premises)
• Enable better collaboration between team members & third party
• Improve forecasting to improve cash flow, minimize overstocking & achieve optimal inventory
• Reporting capabilities
• Lower operational costs
• Better risk management
• Predictive insights with build-in artificial intelligence
• Single source of truth with data integrity

How Does an ERP work?

An ERP system is a way for a company to manage all of its operations. The system is made up to automate and digitize business processes so that they can be monitored, controlled, and audited. An ERP system integrates every department in a company and collects data from them such as inventory, production, sales& marketing. The data are then processed and converted into information that will help the leadership.

ERP systems help businesses to adopt new technology faster by providing access to data that was not available before. By implementing a business management system, you can now connect your processes in real-time and get updates on what inventories are available. Employees will be more productive and customer service can be improved. Decision-making becomes easier thanks to data analysis that you’ll have at your disposal.

ERP Integration

The integration of an ERP system with other software systems is a process that will provide a number of benefits to the company. Integrating an ERP system with other software such as CRM, warehouse management, logistic, production management, and more will help the company to have better visibility and control on their cross-functional processes. ERP reduces waste of time, increases efficiency, improves customer management, saves money, makes employees more productive, enables better decision-making and delivers a more accurate representation of your company’s overall health.