An Enterprise Resource Planning or ERP system is software that helps organisations manage core business processes and streamline operations within a single centralised system or a suit of related applications. ERP software brings together multiple functions like accounting and finance, sales, purchasing, human resource management, customer support, inventory, supply chain, manufacturing, business intelligence and more into a central, integrated system. It cuts down on the need to invest in multiple large scale programs, and minimises the time and effort required to train staff to become proficient and managing all these applications. It works extremely well across large, multi-national organisations, where outposts in different countries or continents can still use a unified system to process and file all their business related works.
ERP software solutions have increasingly gained traction among newer companies for its centralized approach to business processes. With it, you can collect, store, manage, and interpret data from various business units. Likewise, ERP is used to automate back-office tasks and streamline cross-departmental workflows. When optimized, the solution can drive efficiency, lower costs and increase profitability.
Another huge benefit to using an ERP system in is reducing human error. Rather than enter the same data in multiple formats across different programs, with an ERP system, an employee can simply upload their data once, cutting down on data entry redundancies and errors that could occur from transferring information between multiple databases. Reports become easier to generate, and companies can better handle their data, now that it's all in one place. Thanks to the sheer volume of data that an ERP system is exposed to, it's also easier to sport trends and changes to key performance indicators. Decisions can now be driven by sound numbers and reports, with added layers of insight and business intelligence that an ERP system can generate on the fly. Armed with this information, leaders get a deeper understanding of their business and can make better decisions, improve their corporate planning and develop more data-driven strategies.
ERP systems also eliminate redundancies and inefficiencies across departments. They streamlines how different departments or head offices manage their business processes and avoids confusion among the employees, lost data, and inconsistent reports. ERP systems standardize business processes by increasing automation, streamlining operations and allowing companies to adopt industry best practices. According to
BetterBuys, using standardized business processes also "leads to improved productivity, faster workflows and fewer mistakes". It eliminates the common phenomenon of departments being siloed by business unit or location - which leads to inefficient use of resources and missed opportunities - by centralizing data and streamlining business processes.
Employees in various departments can access the same pool of information and work together to meet common business goals. Standardized workflows make collaboration more efficient. ERP systems streamline all aspects of the supply chain, from purchasing raw materials to customer fulfillment. The software can analyze shop floor data, for example, to help reduce lead times and inventory on hand, as well as increase machine utilization and on-time deliveries. ERP solutions can also communicate with suppliers and customers to produce insights like demand forecasting to estimate future sales, which reduces waste and improves profitability."
It Increases Efficiency: Business processes like accounting, sales, marketing, production, and inventory are integrated in one ERP platform. It’s easier to collect and access data across the organization, streamlining cross-departmental workflows. Likewise, ERP automates day-to-day tasks like entering data or generating reports. Repetitive processes are eliminated, freeing teams to focus on their core deliverables. For instance, marketing can run a daily web traffic report without bugging tech; or, accounting can instantly access the week’s sales stats without chasing the sales director. ERP also provides managers and key stakeholders with quick look-ups. Dashboards allow decision-makers to glance at key performance indicators across the organization. If they want to investigate more, managers can drill down to details in a few clicks. It Promotes Collaboration: ERP breaks down walls between departments. Data silos are integrated and a process superhighway links local workstations together. This setup allows teams that used to operate in a vacuum to easily collaborate with other teams inside the ERP platform. Moreover, SaaS ERP further extends collaboration between remote teams and headquarters through the internet. Offshore business units are now within earshot of their mother unit. A culture of collaboration drives innovation and team play and, in general, makes businesses more competitive. It Helps You Comply with Industry Regulations: Many ERP solutions feature built-in regulatory process standards and compliance reporting to help businesses meet myriad business requirements. ERP solutions subscribe to reporting protocols for aspects like financial accounting, product regulations and data security. It Allows You to Make Accurate Forecasts: The only worse thing about the lack of a forecast is a wrong one. Forecasts shape strategies; thus, it’s crucial organizations get the real picture. Using a centralized database, ERP lends to a company’s disparate business solutions a standardized process, ultimately, enhancing data integrity. ERP reporting tools use advanced filters and analytics to sift data for inconsistencies. Features of ERP software like deduplication also ensures data is updated and duplicate-free. With data integrity intact, managers can generate reports with realistic forecasts. Similarly, estimates are within a sensible range of outcomes. Moreover, advanced ERP solutions with business intelligence tools use machine learning and predictive algorithm that allow users to dig deep into big data. Companies with complex data sources can leverage ERP for hidden insights and gain a competitive edge. It Reduces Operational Costs: A company can also leverage ERP to cut down costs. When processes are streamlined and key metrics are closely monitored, disruptions, delays and breakdowns are anticipated or its impact better managed. Manufacturing and distribution are especially vulnerable to disruption. But with ERP allowing production, engineering, customer service and other business units to work closely together using real-time data, resolving sudden problems is faster and operating costs are kept within budget.
There are three main types of ERP systems. In an on-premise ERP solution, the software is installed and customised on the company's computers and servers. Companies usually pay a large, upfront, one-time fee to purchase and use the software across multiple computers. This solution is generally favoured by large manufacturing companies because they can be customized for extensive manufacturing execution systems and advanced planning and scheduling. In a cloud-based ERP software, the system is hosted on a remote third-party server. Companies pay an annual or per machine subscription fee to access the software, which is done via the internet. In this way, the company is free to avail of the benefits of the software while leaving the system's maintenance, debugging, security, backup and updates to the vendor. The low up-front costs and fast integration make this an attraction solution to SMEs. In a hybrid ERP solution, there's a mix of both types of systems. Cloud and on-premise software, often from multiple vendors, is integrated into one system. This is an increasingly common option as many companies integrate newer cloud ERP solutions into their legacy on-premise system.
There are numerous types of ERPs available on the market today, including popular solutions like NetSuite ERP, Sage Intacct, SYSPRO, Odoo, Oracle ERP Cloud, Microsoft Dynamics GP, SAP ERP, Advantage 365, and Z Suite ERP. Picking the right ERP solution can seem like a feat, especially with so many great options on the market. The first step is to understand what your company needs and what it's looking for in an ERP solution. To do this, look at your current business processes. Identify the issues your company is facing, as well as opportunities to streamline operations. This will help you to set goals and objectives for what your company will accomplish after implementation. Next, create a shortlist of vendors that best fit your needs. It might be useful to make a list of your required features, as well as preferred-but-not-necessary features, so that you won't be oversold by vendors that push extra functionality. Next, contact your vendors and vet them on experience, customer reviews, and product quality. Don't hesitate to request a demo so you can test out the software for yourself. Finally, when you've almost made your decision, ask around companies that are using the same software for real-life feedback on how they find the ERP solution is working for them. Compare different price quotes, deployment options, implementation times and customer support, so that you can make a sound decision based on great background research. To get you started, you can find a list of approved ERP providers in Doha, Qatar below.