Introduction
Introduction
How this software can benefit your company is probably one of your first concerns if you’re just starting to think about implementing an ERP system. An ERP system acts as the company’s central database, providing extensive reporting capabilities and a plethora of methods to boost efficiency and cut expenses all around the business.
These are some of the main arguments in favor of ERP investment, but we’re here to explain the benefits this technology can offer companies just like yours. What features will this system add to your company’s current offerings? In what ways will technology promote growth and cut costs? We’re here to assist by thoroughly outlining the 15 benefits ERP can offer your company.
15 ERP Advantages and Benefits
An ERP system has many advantages despite having a simple concept: it unifies all departments and their data on a single system. These are the top 15 noteworthy benefits that an ERP system provides:
Information Security
Because data is so important to making the best decisions, it has become a valuable asset for businesses, and ERP software can help safeguard that asset. The level of protection is increased because all of this data is in one location rather than being dispersed among several systems with differing degrees of security. Spreadsheets and other documents that are circulated via email and kept on staff desktops are replaced by it. Your data is usually spread across several distant servers when using a cloud ERP system, providing an additional degree of security by preventing a single point of failure and establishing redundancies. This is particularly crucial if your business deals with a lot of sensitive client information.
Centralized and Standardized Data
The fact that all data from various departments is kept in one location accounts for a large portion of ERP’s value. Without a system like this, information is frequently dispersed widely throughout a company in different spreadsheets and applications, making it more difficult for employees to find what they need. More difficulties arise because this method frequently produces redundant data in inconsistent formats.
Additionally, by standardizing all of your important data, an ERP system can assist with that. Everything will be in the same format because it’s all in one system, so running reports or analytics won’t cause any problems.
Enhanced Output
There are numerous ways in which an ERP system can significantly increase productivity. One way is that it frees up staff members to work on other projects that add greater value to the company by automating a lot of simple, repetitive tasks. In addition, it can expedite a number of tasks by simplifying procedures and cutting down on time spent looking up the information they require. Employees don’t need to ask around for a specific set of data or specifics on how certain processes work because they have visibility into the entire company.
Savings on Costs
The most compelling argument for executives and company owners to purchase an ERP system is that it frequently results in significant cost savings. Numerous operational and administrative expenses can be cut or eliminated thanks to the automation we’ve already covered. With this software, for example, manual data entry or procedures requiring extensive paper trails are frequently eliminated.
With all the insights this software can offer, there are many more opportunities to save costs. Being able to keep an eye on your company’s health in one location makes it much simpler to identify the cause of rising costs and cut them down. Better planning made possible by an ERP system should also avoid costly mistakes like rush orders, overproduction, and overordering. An ERP system can lower your expenses in a myriad of ways, which is why these solutions frequently have a quick return on investment.
Streamlined Processes
Working with a system expert during the ERP implementation process will help you assess your processes and see if there is a better way to accomplish a task in the new system. Not because it’s the best option, but rather because it’s how it’s been done for years, work is frequently done in a particular way. In order to expedite and simplify tasks, an ERP can aid by eliminating steps and implementing other enhancements.
Efficiency of Operations
Since an ERP solution affects every aspect of the business, it increases efficiency throughout the entire organization. Thanks to increased automation and information availability, improvements should be seen by recruiters, warehouse managers, and C-level executives alike. Procedures become less time-consuming, which frequently helps customers as well as the business. This has the potential to significantly lower operating costs and increase profits.
Think about a producer who produces ten goods with a 20% profit margin on average. It can quickly identify its least profitable products with the use of an ERP system, and after analyzing the data, determine that the labor costs for the two products with the lowest margins are significantly higher. The business learns from staff interviews that the majority of the labor required to produce those items is manual and time-consuming. Thus, the manufacturer sees an increase in its average profit margin to 25% after deciding to buy some machinery that can automate the production of those goods. That’s how the ERP software has instantly saved the company hundreds of thousands of dollars a year.
Improved Client Support
Almost all companies compete with one another for the same clientele. That’s why the customer experience is so important, and how well a business can serve its customers has a big impact on that experience. Because an ERP centralizes all customer data, including contact information, order history, and support cases, it enables businesses to provide better customer service. When clients do require assistance, this makes it possible to provide quicker fixes and a more tailored experience.
Additionally, an ERP system can raise the quality of service you provide by ensuring that customers receive the correct items and that orders are filled on time thanks to more accurate inventory and order data. Keeping those problems to a minimum will satisfy your clients and raise the likelihood that they turn into repeat customers.
Adaptability
Because ERP platforms are meant to serve businesses of all sizes, the leading vendors have incorporated a high degree of flexibility into their offerings. Because of its adaptability, users can customize the system to meet their own needs, such as those involving special procedures or unusual metrics. ERP systems can be complex for the same reason — they can meet your exact requirements — but the two are really not possible without the other.
This adaptability becomes even more crucial as your company develops. Because of its flexibility, the system can continue to function for your company even if the most effective workflows and KPIs change over time. Replacing the system is not necessary.
Precise Forecasting
Only when your company is aware of what to anticipate will it be able to plan for what lies ahead. This is where forecasting enters the picture. It projects future demand, revenue, expenses, and other figures using a variety of historical data as well as occasionally additional inputs. When you have an ERP system in place, forecasts become much more accurate because all the data is now in one location and is based on more complete and accurate information.
With more precise predictions, you can plan ahead and get ready for what’s probably going to happen. If a 30% increase in sales is anticipated, you should proactively buy more inventory or, if your company provides services, add more workers with the necessary expertise in areas where you anticipate demand will be highest.
Collaboration
As we’ve already discussed, a lot of these advantages make collaboration easier. Working together and proactively reaching out to colleagues when they see a chance to assist one another is made much easier when staff members have visibility into the information and working methods of other teams. Teams are no longer working in silos with applications that are exclusive to them and don’t interface with other back-end systems.
The company as a whole gains when staff members collaborate and communicate more often. Working together, they might find redundant tasks that can be removed or come up with better ideas for managing everyday operations. Communication breakdowns or ignorance of what others are working on only result in issues; however, an ERP solution helps avoid this issues.
Selecting an Enterprise Resource Planning System
At the very least, the ideal ERP system for your company should enable you to take advantage of every advantage we’ve outlined above. When comparing solutions from various vendors, do your homework and inquire about the benefits that would apply to your business in particular.
Of course, the ideal ERP platform for your company will differ based on its unique characteristics, such as its size, industry, business plan, and long-term objectives. Which ERP modules would make the most difference right now, and which would be wise to add later? Make sure the system is scalable and flexible enough to accommodate the expansion of your company and changing priorities, in addition to being able to meet your needs as they arise.
Jupical.io was established in 2018 and has a team of exceptionally talented professionals. With our extensive experience in implementing Odoo ERP and ERP from scratch, we have helped businesses from a variety of industries achieve their goals and fully utilize the platform. We are proud of our ability to provide customized solutions that are designed to meet your unique business needs. We are committed to making sure you succeed in utilizing ERP, and this is demonstrated by our unwavering commitment to quality, innovation, and excellence.