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ERP Software 101: Everything You Need To Know

Choosing the right technology for your business is not an easy task. You want to be responsible for the growth and innovation of your company but at the same time you don’t want to risk investing in a failed project.

So is investing in an ERP software is worth the risk? In order to find the answer, you need to weigh the benefits it can provide, what are the functions it can support and all the other details that are important for you to know.

The process of ERP implementation requires a lot of research and planning. This is especially true when you have very less knowledge about the software. In this article, we shall discuss everything that you need to know about ERP software.

What is ERP software?

If you search ‘ERP’ on the net, you will come across various ERP descriptions. This can make it a bit confusing for you to understand what exactly it does.

To define it in simple words, ERP means Enterprise Resource Planning. It is basically a business process management software that helps a business to use a system of integrated applications to manage the business. Not only that but it also automates various back officefunctions related to human resource, services and technology.
With the help of a reliable ERP software you can integrate all the facets of an operating, from product planning to development to manufacturing to sales and marketing in a single database.
This enterprise application is mainly made for larger businesses however, small and medium sized businesses can also benefit themselves from the use of an ERP software. The best thing about ERP software is that it can be customised based on the needs of your business. This is why it is considered to be suitable for all types and sizes of businesses.

Common ERP Features

ERP software is loaded with features which makes it more convenient to work with. Some of the main features which make ERP so important include:

  • Accounting and finance

An ERP system has an accounting and finance module that helps a company track its finances including its budget and expense planning, revenue management, tax management and core accounting.

  • Supply chain

Another important module is the supply chain module which is used to track products from manufacturing to warehouse to distributors to customers.

  • Customer relationship management

With the help of this model, you can manage your client operations including marketing, sales and customer service. Not only that, but even employees can track sales prospects.

  • Manufacturing

Manufacturing companies can make use of the manufacturing module to manage their shop floors, bills of materials, quality control, planning, manufacturing processes and product lifecycle management.

  • Inventory management

Inventory management module is used for tracking materials and supplies through inventory control, automatic ordering, inventory scanning and purchase orders.

  • Human resources

With the help of the human resources module, you can easily manage your hiring cycles. It provides benefits such as applicant tracking, payroll, and business

  • Business intelligence

A business intelligence module is known to collect and analyse data from several sources and thus, it helps you to make business decisions.

Benefits Of ERP Software

By implementing Enterprise Resource Planning software in your company, you can avail a lot of benefits. This include, increased efficiency, improved productivity, streamlines processes and also reduced costs. But to make the most of your ERP software, you need to make sure that you have tailored it correctly to suit your business needs.
Some of the main benefits of using ERP software include:

  • Improved efficiency

With the help of an ERP software you can eliminate repetitive processes. Not just that but it can also reduce the need to manually enter information. The system is designed to streamline various business processes. This makes it easier for the company to collect data, no matter what department they are working in.

  • Department collaboration

No businessman would want to run a business where every department is functioning separately from the other. Collaboration between the different departments is very important for the success and growth of the business. Since ERP system is centralised and consistent, it will make it easier for you to promote collaboration between all the departments of your company.

The good thing about the software is that it touches every aspect of your business and thus, it encourages collaborative, interdepartmental efforts.

  • Scalable resource

Structured ERP software are known to allow the addition of new functions and users to grow the initially implemented software over time. When your business is ready or grow or needs more resources, your implemented ERP software should be able to facilitate the growth.

  • Cost savings

ERP provides you with a single source of accurate and real-time information. This as a result, helps you to cut down on the operations and administrative costs. It allows manufacturers to manage their operations, breaks up information logjams, prevents delays and disruptions and also helps you to take right decisions quickly. If you have the right ERP system to meet your needs then you are sure to witness a powerful ROI.

  • Integrated information

When you have an efficient ERP software implemented in your business you don’t have to worry about having separate databases. An ERP software allows you to store all your data and information in one single location. this means that you can integrate software like CRM and others. Having all your data stored in one location means your entire company have access to the same data. Also, you can find everything you need in one place which helps you save a lot of time.

  • Streamlines processes

As a company continues to grow, its operations become more complex. This is where an ERP software could help you increase the productivity of your business. It helps users to navigate complex process, improve functions including production, order completion and delivery. Not only that but it also spares you from the trouble of data re-entry. With an ERP software you can have streamlines process throughout your business.

  • Increased productivity

One of the many advantages of using an ERP software is that it helps you to save a lot of time and also increase your productivity levels. That’s because ERP has the ability to automate redundant processes. This saves a lot of time which can be invested in preparing other tasks and projects.

ERP Software: Is it suitable for all business sizes?

Implementing an ERP software requires huge investment and resources because of which it has always been associated with bigger companies. But with the increasing availability of cloud based ERP solutions, it has made possible for small and medium sized businesses to take advantage of the software.

The typical buyers of ERP software include:

  • Large business

These are basically huge companies with more than 100 employees. It makes more than $50 million a year and have a dedicated IT team for support.

  • Medium business

A medium sized company usually have 100 or less employees. It makes less than $50 million in a year but it do have an IT department.

  • Small business

A small company has less than 50 employees and makes less than $50 million a year. Also, they don’t have any dedicated IT team.

ERP Trends

Usually change is really slow in the ERP field, but in the last few years it has introduced new technology trends which are fundamentally shifting the area. These new trends have a significant impact on the growth of ERP software. The trends we are talking about here include:

  • Cloud ERP

Cloud based ERP is a new concept but it is slowly penetrating into the enterprise. However, it has a long way to go as many of the ERP users are reluctant to store their data in the cloud. But with the list of benefits that cloud ERP has to offer, these reservations seem to slowly fade away.

  • Mobile ERP

Both employees and executives want real-time access to information, regardless of their location. This is where the need for mobile ERP comes into the picture. It allows you to access the stored data from anywhere and at any time you want. It is expected that businesses will adopt mobile ERP for to benefit themselves.

  • Social ERP

There is a lot of buzz surrounding social media and how important it is to add to ERP systems. There are many ERP vendors who have included social media packages in their ERP systems. But the main question is that how useful it is going to be for businesses.

  • Two-tier ERP

There was a time when companies attempted to create an all-encompassing ERP software solutions which could take care of every important aspect of a company. But due to some major, expensive failures that very idea have to a rest. It has now forced them to adopt the idea of a two-tier ERP system.

To conclude, it can be said that an enterprise resource planning ERP business management software makes an important part of every business. It not only help you with your businesses functions but also automates various processes which makes work easier for your employees. To make the most of your ERP system make sure that you choose the right one for your business. Your ERP system should be able to facilitate the changes of your business activities when it starts to grow.

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