27 Benefits of ERP System Implementation to your Company
- Saudi ERP & Website Solution Blog March 06,2016
What are the Benefits of ERP? What will contribute to my company? Since implementing an ERP system is a long and complex process is normal that many entrepreneurs are emerging doubts about its viability. And no wonder: on average it can take between 6 and 12 months (minimum) before the ERP system fully operational. For this reason (and the large amount of resources consumed) doubts about the introduction of these systems are more than justified.So ... Why implement an ERP implementation?
An ERP is an information system able to centralize and unify data from different business departments facilitating the flow of information. Both managers and middle managers, they will have unified real-time information that will facilitate the process of decision making.
What do the Organizations opt form ERP?
1. Improve the decision-making process.
As overtook the beginning of the article, ERP system can create a shared database with more and higher quality that those responsible be displayed on your screen in real time streamlining and improving the process of decision making.
2. Planning realistic future scenarios
By having better information can make realistic estimates and forecasts anticipating future scenarios.
3. The minimum duplication
Companies that do not yet have an ERP solution is easy to see that its departments operate somewhat independently of each other, so they end up creating duplicate records and reports. Integrating ERP, accounting for drastically reducing enable these duplications.
4. ERP systems are modular
ERP is formed by modules. This way you can implement modules your company needs at all times. If in the future your company evolves and grows with your ERP will do it if you incorporate new features.
5. Total adaptation to the needs of your company
All companies are different. Therefore the provider of your ERP system should perform a preliminary analysis of the needs of your organization to ensure that the application is perfectly suited to it. The ERP solution must fit your business, not vice versa. Read ERP System_A Complete Guide.
6. Greater control and traceability
The ERP systems facilitate product tracking throughout the organization, from entering the raw material to delivery of finished product to customers.
7. Integration with other members of the value chain
The new concept ERP II exceeds the limits of the company by adding other members of the value chain: customers and suppliers.
So the company becomes a strategic partner who can draw a competitive advantage by actively participating in the design and development of new products contributing their experience.
Regarding customers, ERP allows to have more information and better quality that allows you to adjust production orders and purchase your needs. On the other hand, we will have a database of segmented our customers allow us to perform marketing campaigns targeting specific segments.
8. Improved Internal Communication
The ERP suppresses information barriers between departments by integrating and improving internal communication.
9. Automation of Tasks
The heavy ERP systems to automate repetitive tasks formerly performed by hand (generation of delivery notes, invoices etc.).
In this way our operators can focus on more productive tasks that really are what give us value. But it is by reducing the human component, will fall the number of errors (although not entirely eliminated because certain manual actions such as data entry will still be necessary).
10. Lower costs, more competitive
The higher efficiency achieved, the decrease in the number of errors and reducing duplicate tasks help decrease business costs. Cost reduction will she allowed us to
- Increase our profit margin to drop the unit cost.
- Reduce the price of each product to reduce its cost.
11. Increased performance and return on investment in the long term.
Thanks to all the above advantages it can achieve increased profitability and benefits. In other words, the increase in performance achieved with the implementation of Enterprise Resource Planning compensated in the long run, the initial investment.
In a particular way, point out the benefits of ERP systems in nine points
12. Access to reliable information. This benefit is achieved by:
- The use of a common database
- The consistency and accuracy of data
- Improved reporting system
13. Avoid data redundancy and operations and. Arial
As the various modules of the ERP system in real access to the same central database time, two things are avoided,
- Duplicate or multiple records of the same data in the system, and
- Duplication of operations for lack of updating the record on them.
14. Reduced cycle time and delivery.
This benefit is achieved on the one hand, to minimize the recovery process, and secondly, when reporting on the production or delivery delays. Read 14 Top ERP Softwares for Small Business.
15. Cost Reduction.
This reduction is due both to the economy of time, and to improvements in the control and analysis of business decisions.
16. Ease of Adaptability.
ERP systems can be modified through the redefinition of its different business processes, this makes it easy to adapt and restructure to meet the new requirements.
17. Improvements in "Scalability".
Due to a modular design and structured ERP systems allow additions or scalar functions to increase the initial solution.
18. Improved maintenance.
The existence of a long-term maintenance provider as part of the acquisition of ERP system allows better process to keep the information system up to date with advances in technology and management.
19. Reach outside the organization.
The extension modules of ERP systems such as CRM (Customer Relationship Management - Managing the relationship with the client), and SCM (Supply Chain Management - Managing the supply chain) make the organization and integrate with customers' providers outside the traditional boundaries of the enterprise. Read Top 10 Open Source CRM Systems.
20. E-commerce and e-business.
On the one hand, this is possible because the technology infrastructure of ERP systems supports processes online, which is essential for electronic commerce, and on the other hand, the adoption of ERP systems develops a culture of collaboration between businesses.
21. Long-term Savings.
Truly one of the biggest benefits is that an ERP system saves money. In its most basic definition we understand that a solution of this type we manage our business, our processes, our tangible or intangible assets, our human resources and our customers. It is a more efficient management which usually leads to savings. It's that simple. That itself is a very long-term savings, we must not forget.
22. Decision Making.
It is said that such software is a strategic decision and basically have every reason in the world. We facilitate a decision that we have the data of the entire company on a screen. For example, an ERP can bring a scorecard, as if it was a car with the information as up company right now. By having readily available data from all departments and a well-defined schedule within the system, it is logical that we can take important decisions more easily.
23. Quality and Customer Relations.
Proper implementation of an ERP allows us to respond to the customer in a much shorter time. For example, imagine that we sell cheese, because if you ever have a complaint that a lot has been shits, we can find very quickly the origin of milk, the supplier, the store where he had saved, expiration dates etc. Basically, it gives us a much faster traceability features. Not to mention the possibility of incorporating the module CRM (Customer Relationship Management) to our application which will make us even more efficient when it comes to customer relations.
24. Benefits of ERP for Security.
The crucial company information will be properly protected in two ways. Within the meaning of information theft or unauthorized access to it as well as data security. All the solutions we have seen incorporate different levels of access or authorization. On the other hand the information is centralized and automatically scheduled backups to prevent any failure. In the case of cloud solutions, data security is even greater to be replicated in different places.
25. Employee Productivity.
Perhaps it is the most obvious and logical benefit of implementing an ERP, also stems from the very definition as in 1. An ERP system optimizes process management, thus increases the productivity of employees. Eliminating duplicate work, redundant information is eliminated or processes are automated. For example, imagine we implement the validation of a field that involves the total weight of the goods to a truck. A mistake here can be crucial in the business of a company, the vehicle can simply stop at the border. But with a simple validation in the form we avoided the "tragedy".
26. Standardizes Organization' Profit Level.
When all staff from different departments work with the same program, this application requires them to be more "standard" or more ordered. It helps them to reflect on the processes or the way of working of each department which leads to reflection on the process and the consequent improvement. Basically, it helps define best practices within the Workforce.
27. Boost Profit to grow.
Normally, all companies want to grow in the short or long term. An ERP system enables a much more orderly and less painful growth. Indeed, growth can be very traumatic for a company as it creates tension throughout the structure. Having visibility of the image of a company at a specific time on a screen, we can more easily determine where is the weak point in the structure of the company or impossible growth must be strengthened. Here we really rely on point number 2, improving decision-making in a company.
To those mentioned above can be added as follows:
Having an efficient flow of information and transnational full through the different areas of the company, business units and geographic areas makes even greater benefits are taken, especially in a matter of time and access to information.
- The processes of strategic planning
- Human resource management
- Resource optimization
- Cost Reduction
- Raise customer service capacity
- Raise suppliers benefits in time and cost
- Integration of whole management systems
- They optimize business processes
- Provide reliable information in real time
- Improvements in customer service and care for them as well as
- Increased competitiveness as there are changes in the environment.
In conclusion, we can conclude that if it is true that ERP implementation is a complex process need not be painful if properly managed and have the appropriate equipment for leading change. For the successful implementation of ERP System you must contact to well known ERP service providers. Read How To Deliver a More User Centric ERP Solution? The rewards to be found in the enormous Benefits of Enterprise Resource Planning accruing to the company to incorporate this solution. Are you ready for joining the change?