Business owners always want their business to run as smoothly as possible, and amid the countless operations that a business undertakes in a single day, that’s no small feat. We want to have all the necessary information at our fingertips, but how can we do that if all of our data is spread across separate systems. This fragmented and disjointed way of working can’t be good for company efficiency.
The image of a business owner as somebody who makes big decisions and deals with the most important problems that arise within the company is riveted in our minds. We don’t want to waste time doing menial tasks, like tracking down certain documents or accidentally duplicating papers, just because there’s no one place where everything can be gathered and accessed. So how can we solve this problem that is eating away at our time and efficiency? Enterprise Resource Planning Systems, or ERPs.
What Exactly Is An Enterprise Resource Planning System?
An Enterprise Resource Planning System is essentially a type of software that automates your business processes, typically ones relating to accounting, supply chain management, manufacturing, marketing, sales, and human resources. Some examples of these processes are things like accounting, project and risk management, as well as various supply chain operations, but there are many more examples based on the specific type of business you run.
An ESP system is a way for different parts of a business to communicate with each other. It achieves this by collecting all of the transactional information for a certain company, no matter the source within the business. Then, employees are given access to this central database, so different departments are on the same page and are basing their decisions on the same source of information. As you can see, ERP systems are pretty indispensable. But, if you’re not yet convinced, here are some areas of running a business that is much improved by the implementation of an ERP system.
Increase In Efficiency
Old, outdated software is more trouble than it’s worth when it comes to running a business, as the vast majority of software is no longer sustainable. There’s no need to hunt down forms in dusty drawers or the forgotten corners of your PCs. An ERP system helps you find exactly what you need in a much shorter time frame, due to the fact that all the data is stored in one place.
Employees can quickly get a hold of the correct information and make a well-informed decision that much faster. It also encourages collaboration between different departments and makes it so that everybody is on the same page. We will further explore this collaboration point later on in the article, so keep it in mind.
Cut Down On Unnecessary Costs
An ERP system can seem like a big purchase. You might doubt that it’s going to be worth it after all. However, ERPs are proven to provide excellent ROI. Not only does it increase efficiency and save on time, but you also don’t have to train your employees to use several different systems before they can start working. You can also see a stark reduction in costs when it comes to the elimination of human error.
You’ll be able to see the potential profits of ERPs in no time. There are Technology Evaluation Centers that can help you assess whether your software and overall tech infrastructure are up-to-date, needs an update, or a total overhaul. This way, you can choose where you can afford to cut costs and where it’d be a smarter move to invest.
The ERPs are great for encouraging collaboration between different departments, but why is that important? Well, your business is ordinarily pretty fragmented. Every department has a set of tasks to complete, but they may not interact unless they make a concerted effort to do so. This can lead to several sources for the same data, many of which may conflict with one another. This can lead to a waste of time or money at the very least.
Having a single source of truth eliminates human error and any other type of miscommunication between departments. Anyone from any department will be able to access the same data. This makes the collaboration between different parts of the company much more straightforward, and employees are a lot less likely to hesitate before reaching out to one another. This way, there’s less room for doubt and the staff feels confident in their decisions.
One of the biggest benefits of implementing ERPs into your business is automation. There are numerous tedious tasks that not only need to be completed but also need not fall victim to human error. These tasks include things like keeping track of changing inventory levels, processing orders, and generating reports. Data entry may not be particularly challenging in most aspects, but it is very repetitive. And the more time your employees are forced to punch in the same line into different forms, the more likely they are to mess up somewhere.
This is where the ERP comes in! The right ERP system can reduce the time needed to tend to these tasks down to mere minutes. This leaves more time for your staff to do things that require a human being’s attention. The ERPs also allow for executives to see various reports as soon as they log in, without having to rely on an IT person to compile this information for them. This in turn helps them make well-informed decisions for the company, and it frees up the IT department’s time.
Technology has enabled many businesses to boom via new and innovative software. ERP systems are one such innovation, gathering all the relevant data into one big, central database for any employee to access. Its benefits far outweigh its disadvantages, if you choose the right solution for you and your business. As you conduct more research on ERPs, you’ll soon find out why so many businesses implement them and why they’re so essential.
About the Author
Ray Lowe is currently employed as a Senior Ecommerce Manager. With years of experience in the retail space, Ray is an expert in formulating and implementing e-commerce strategies to increase revenue.