What is Enterprise Resource Planning? | Benefits of ERP
What is ERP? How is ERP used in business and how does it benefit a company?
ERP is an abbreviation for “Enterprise Resource Planning” and acts as an administrative software program, that tracks a company's business interactions across departments.
ERP brings the company's work processes together
ERP is created to gather all the company's work processes, regardless of which program they work in, and still enables the feeling that the processes are closely linked. ERP can therefore be defined as optimization of manual work processes added with a portion of the modern technology's possibilities for exchanging data and simplifying it. ERP systems are designed to be accessed online. This means that an employee have access to the company's data regardless of time and place. It facilitates data sharing in the company, provides greater mobility and optimizes internal work processes.
ERP can gather all administrative tasks, give quick interview and form the foundation for the company's decision based on data. ERP covers many types of administrative processes, e.g.:
- Finance and accounting
- Statistics and reporting
- Customers and orders
- Suppliers and procurement
- Stocks and inventory management
- Warehouse Management
- Distribution and locations
There is no need to gather all business areas in the ERP solution. Because of the technological advancement, it has become easier and cheaper to implement ISV-solutions to the ERP-solution, that often add even more value. The above-mentioned tasks demand add-on ERP-applications (ISV-solution) to get the full yield of ERP-solution.
ISV-solution are increasingly popular, as IT-systems and IT-solutions are built for specific purposes. There it can be prudent to use ISV-solutions to specific areas, that can lift the ERP-solution.
Advantages of implementing a ERP-system:
- One database for the entire company’s transactional processes
- Connect the work processes – everything from purchase to production
- Get smarter and more efficient workflows – the company gets increased flexibility in terms of operation and access to data
- Get better insight into business information as well as answers business question via one source
- Optimize productivity through automatization of core processes (accomplish more with fewer resources)
- Optimize reporting and share the result easier
- Simplify IT-processes/workflows with integrated ERP-application/ISV-solution (ex Lasernet for document management in ERP-system)
- Achieve increased flexibility by gaining access
Are you about to implement or upgrade your ERP-system? Here are the considerations and 10 good advices.
What is achieved with a good ERP-solution?
The advantages of binding the work processes together shows in the day-to-day work. This was proved by Antalis with the implementation of a new warehouse system, that kickstarted a comprehensive streamlining of the flow around purchase orders, invoices etc. The documents are now interconnected and searchability and usability has increased. Bigger transparency and integration: “Earlier we would search for one hour per order to see which documents belonged to an order”, tells system developer Benny Helander. “Now orders, invoices etc. have been connected together, and it became easier for one department to see whether another department has sent an invoice”. Read the case here.
ERP-software gives overview in customer contact, optimizes work processes and streamlines resource management.
What is ERP?
ERP stands for Enterprise Resource Planning and is an electronical resource management program or in short: a business system, that manages the company’s workflows and -processes in one joint business system. This means, that the ERP-system handles the company’s transactional processes in anything from production, order management, sales, purchase, inventory management, customer management (CRM) and to financial management. ERP system are also referred to as “Financial System” or “Accounting System”, the purpose of it is in financial, sales and purchase. ERP therefor based on one common database for the whole company’s business transactions.
Add more value to your overall ERP-solution
ERP-systems has its limitations, and that is particularly evident in the output parts (document management), which often requires many consulting hours for external programmers. Output is more complex than many expects, and therefore it becomes underestimated. This results in more expensive and inferior solutions. It can be avoided by incorporating a special focus on output management in ERP- projects with an ISV-solution. Here all business logic stays in ERP-systems, so when the ERP-system is upgraded, the documents are maintained. Do you want to read more on, how you can avoid the hidden expenses of ERP, then click here.
Source: Microsoft, SAP and Oracle.