Why have an ERP system?
Enterprise resource planning (ERP) is a system of integrated software applications that standardizes, streamlines and integrates business processes across finance, human resources, procurement, distribution, and other departments. ERPs were originally designed for manufacturing companies but have since expanded to service industries, higher education, hospitality, health care, financial services, and government.
ERP systems improve enterprise efficiency and effectiveness in a number of ways. By integrating financial information in a single system, ERP systems unify an organization’s financial reporting. They also integrate order management, making order taking, manufacturing, inventory, accounting, and distribution a much simpler and less error-prone process.
What does ERP include?
Most ERPs also include customer relationship management (CRM) tools to track customer interactions, thereby providing deeper insights about customer behaviour and needs. They can also standardize and automate manufacturing and supporting processes, and unifying procurement across an organization’s disparate business units. An ERP system can also provide a standardized HR platform for time reporting, expense tracking, training, skills matching, and the like, and greatly enhance an organization's ability to file the necessary reporting for government regulations, across finance, HR and the supply chain.
Properly operating ERP systems enable enterprises to reduce the time required to complete virtually every business process. They also promote collaboration through shared data organized around common data definitions, resulting in better decision-making. The standardization and simplification that ERP systems offer result in fewer rigid structures, thereby creating a more agile enterprise that can adapt quickly while increasing the potential for collaboration. An ERP systems centralized database, while being a bigger target, is easier to secure than data scattered across hundreds of systems.