Building a business from the ground up takes a huge investment of time, energy and capital. Even when the business has reached the point where the accounting books are in the black and profits are beginning to show, the dangers of competition have not passed. Corporate rivals with more experience and monetary backing are a constant challenge for any budding business and becoming conditioned to compete against them is a priority. A company that is serious about making the necessary changes to improve their overall quality and increase their competitive edge may be ready to explore implementing an ERP system to achieve their goals.
What is ERP?
ERP is an Information Technology acronym that stands for Enterprise Resource Planning. ERP software records and manages a company’s data and processes, including company orders from customers; operation schedules, as well as the maintenance of financial data and inventory records.
Utilizing an ERP system can improve the effectiveness of an organization a great deal by assisting in the defining of processes within the business as well as ensuring compliance throughout the business; securing important and critical business data; making the work-planning process smoother by using current orders and forecasts of potential business; offering up high-level tools for improving customer service; and taking current data and translating it into decisive information.
Benefits of ERP for your Business
The full benefits of an ERP system for a company can best be appreciated when it is fully integrated into the business, involving every aspect from customer service and accounting through planning and design, scheduling, production and distribution of products. Bringing together the varied processes of an enterprise increases performance overall, ensuring that errors and duplication are avoided and that communication between employees throughout the business is clear and coherent, increasing productivity. Productivity is also increased as efficiency improves, freeing employees from time-consuming and mundane tasks.
Signs that your Company may need ERP
The individual needs of a small or medium-sized company vary greatly so there may not be a single indicator telling management that an ERP system should be implemented; however, most of the companies that have had success from utilizing ERP software have experienced similar frustrations and have faced the same kinds of problems.
Companies that are using a range of different types of software to run their back-end and front-end systems separately from one another may find it difficult to share data between software systems. This disconnect may be most acutely felt in inventory management and in the accounting department. In fact, the accounting department may be where the first real signs of trouble and the need for ERP software will be felt. ERP software eliminates these problems by integrating all systems into one database, so accurate sales numbers and financial information is up-to-date and easily accessed.
Another important sign that a company needs ERP technology when IT management has become too time-consuming and too costly. The patchwork of systems that many small and mid-sized businesses utilize make it difficult to upgrade, leaving many using outdated software and vulnerable to security breaches and tampering. Cloud-based ERP software eliminates the need for expensive and time-consuming software updates; instead, updates occur as needed and ripple throughout the entire system.